Ep 340: Operating Agreement As Pre-Nup: Splitting Away From Ensemble Partnership To Launch Your Own Firm With Melissa Joy

Financial Advisor Success

Michael Kitces

News, Business, Entrepreneurship, Business News

4.8 • 696 Ratings

🗓️ 4 July 2023

⏱️ 98 minutes

🔗️ Recording | iTunes | RSS

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Summary

Melissa Joy is the Founder of Pearl Planning, an independent RIA based out of Michigan that oversees more than $175-million in assets under management for over 250 households. Melissa's unique journey in financial planning saw her rise to partner in a large firm, where she had outside counsel review the partnership and operating documents akin to a pre-nuptial agreement, to safeguard her position should the relationship deteriorate. This proved invaluable as she eventually diverged from the firm's vision, and the legal precautions she took upfront ensured a smooth transition to her next venture.

Listen in as Melissa shares why she hired outside counsel to review her firm's operating agreement during her partnership consideration, why she chose to acquire her CFP marks, even though she initially planned to have a career solely in operations, and why she eventually chose to leave her position as partner to start her own business. We also discuss how she strategically set up her firm as a DBA under the firm of a trusted advisor friend, how she incorporates a blend of the Entrepreneurial Operating System and Small Giants approaches in her firm, and how she cultivated hundreds of marketing contacts across numerous channels, including social media, local events, and webinars.

For show notes and more visit: https://www.kitces.com/340

Transcript

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0:00.0	Welcome to the Financial Advisor Success Podcast, where you go behind the scenes with
0:06.8	financial planner, speaker, and consultant Michael Kitsis to hear stories of how leading financial
0:12.7	advisors navigated the inevitable challenges that arise on the path to success and get insight
0:18.3	from leading industry consultants about how to break through to the next
0:21.9	level in your advisory business. And now here's your host, Michael Kitsis. Welcome, everyone.
0:28.7	Welcome to the 3040th episode of the Financial Advisor Success Podcast. My guest in today's podcast is
0:34.5	Melissa Joy. Melissa is the founder of Pearl Planning, an independent
0:38.0	RIA based in Dexter, Michigan that oversees more than 175 million in assets under management
0:43.0	for 251 client households. What's unique about Melissa, though, is how she originally
0:48.8	built her career following a path of becoming a partner in a large ensemble firm, but when she
0:53.2	finally got the opportunity to make partners, she still had an external lawyer review the partnership documents and the
0:58.2	company's operating agreement like a pre-nop, hoping for the best and that it would be a
1:02.4	relationship for life, but ensuring there was a clear documentation of what would happen if
1:06.1	the relationship didn't work out in the long run, which proved to be important as ultimately
1:10.6	she and the business
1:11.3	did grow apart in their vision of the future. And the legal work Melissa did up front allowed her
1:15.5	a pathway to be able to start over again when it became clear that she and the firm needed to
1:19.7	partways. In this episode, we talk in depth about how, while Melissa was being considered for
1:24.9	partnership at her former firm, she decided to have outside counsel review the firm's operating agreement with its provisions and limitations about what happens
1:31.4	if the partnership would be dissolved so that she could be clear on what it would mean for her
1:35.2	if she ever had to leave the practice. Why, even though Melissa began her career in operations,
1:40.3	did did not intend on changing role, she was inspired to acquire her CFP marks because of advice that her mentor gave her that she could advance her career further and bring more value to the firm if she also brought in assets and had her own clients.
	...

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