Because you are a business owner, your financial advisor should know more about how to trade securities. You need an advisor who can help you plan and work towards yours financial goals, manage the risks you encounter along the way and build a legacy for the next generation. You need someone who understands the cycles and pressures of entrepreneurship and has a track record to prove it.

Advisors who understand that their entrepreneurial clients require more than standard financial services are often entrepreneurs themselves. Venture advisors tend to be based on independent “registered investment advisors,” or RIAs, overseen by the Securities and Exchange Commission.

In this article, I will share some specific things that entrepreneurs should look for when choosing a financial advisor.

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Look for passion tempered by training and experience

Because they have had experience as RIA owners, these advisors know the stages of business development from startup and early growth to achieving scale and, in some cases, selling the enterprise. Motivated by a fascination with personal finance in the context of business ownership, these advisors either focus exclusively on entrepreneurs or maintain a healthy roster of business owner clients as a passion project within a broader practice.

However, enthusiasm is no substitute for expertise. An advisor who can understand your business and personal finances has experience managing the unpredictable cash flowcreating investment strategies that complement your business and navigating complex tax scenarios.

The experience of a counselor cannot be overstated. Has a particular advisor successfully guided business owners through various stages of growth and increasing complexity? Does this advisor have smart things to say about your industry? If yes, then it's likely that he has navigated challenges similar to yours and can offer advice that is practical and actionable.

Remember, emotion clouds judgment. Knowing that your business is everything to you, an entrepreneurial advisor will work to keep you calm and focused – especially when the stakes are high.

Find an advisor who takes business and has connections

Some advisors who specialize in business-owning clients enjoy working with entrepreneurs from a variety of business types, while others prefer to dive deep into specific areas. The generalist can draw on different scenarios when formulating solutions for your business, while the specialist enjoys the advantages of focusing—that is, expertise and reliability—on your line of business.

The choice will depend on your field and your circumstances. Are you looking for a skilled early stage fundraising advisor for tech startups, output-planning options for dentists, or the needs of a franchise restaurant owner in rapid growth mode? The answer should color your selection.

A suitable advisor for an entrepreneur like you will have strong connections in finance and finance-adjacent fields outside of wealth management. After all, advisors who can call investment bankers, tax professionals, insurance consultants, and legal experts can put you on solid ground when it comes to spotting industry trends, crafting valuation strategies, managing risk, and keeping everything in order when it comes to for tax and estate planning. An advisor with working relationships in these areas can provide full-spectrum financial knowledge of your enterprise and possibly open doors to broader business opportunities.

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Use these tips to find an advisor you can trust

A key factor in evaluating financial advisors is their potential as a long-term partner. Entrepreneurs should vet potential advisors by asking for references from other clients in similar business stages or industries. These insights can tell you a lot about the advisor's skills, work style, and overall accountability.

Taking the time to check an advisor's professional certifications, compliance history, and status as a fiduciary (viewed online at BrokerCheck) are also essential steps in choosing a wealth manager. Fiduciaries, like RIA-based advisors, are obligated to put their clients' interests first. Stockbrokers, meanwhile, are held to a lower standard that only requires their advice to be broadly “appropriate.” If you are still unsure whether your adviser is a fiduciary, ask for a signed undertaking that he will act for you in a fiduciary capacity.

An advisor's transparency about fee calculation and openness about the sources of the advisor's compensation are important trust-builders and necessary to avoid conflicts of interest. It is also critical that the relationship be collaborative. From the start, you want an advisor who proposes solutions that match your personal and business goals. This shows that the advisor has already taken the time to understand your values ​​and risk appetite and that they intend to provide meaningful advice.

Put “works well with Mme” at the top of your list

To gauge this alignment, start by sharing your vision and expectations for the relationship. Investigate the advisor's investment philosophy and approach to financial planning and portfolio construction in the context of business ownership. Ask how she tailors her advice to meet the specific needs of entrepreneurs, with case studies and anecdotes to illustrate her concepts. Meeting with the advisor's support team can also provide insight into the depth and breadth of expertise the advisor's firm offers.

As mentioned, having shared experiences as business owners can support long-term collaboration between you and your advisor. Advisors who run their own businesses have insight into the challenges and opportunities you face as an entrepreneur, resulting in tailored advice.

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Comprehensive advice for business owners should go beyond business and investment considerations. For most of us, after all, money is just a tool to help us meet our personal, family, and philanthropic goals. A skilled counselor integrates these personal aspects of Financial Management with the business to ensure that the actions taken strengthen other important aspects of the entrepreneur's life.

Finding the right financial advisor is a crucial step for entrepreneurs eager to improve their financial health and make the most of their opportunities. A suitable advisor combines industry knowledge, experience, networking skills and a deep understanding of entrepreneurship. By choosing an advisor who can act as a partner, entrepreneurs can achieve financial strategies that equally support their business and personal goals.