Frank Banks-Seeney, Principal at Andrew Cohen Associates, admits that even he was surprised at the sum realised when the Essex-based independent financial advice firm was sold to Fairstone.
"I never expected to achieve almost 180% of the agreed value," he says.
"I was hoping to get a bit more than I'd planned but I never anticipated getting to that level so it was very gratifying."
Andrew Cohen Associates in Saffron Walden is one of over 100 firms to have been integrated into Fairstone via its unique Downstream Buyout (DBO) model.
Taking the approach of a long-term partnership rather than an immediate purchase, the DBO approach offers a more flexible pathway to realising value for principals – and continuity for their clients.
Aimed at high growth firms, the process begins with a minority investment, enabling firms to retain full control while accessing operational, compliance and financial support to scale with confidence and realise greater value as they grow.
For Frank Banks-Seeney, this approach was key in his decision to join Fairstone.
He explains: "I had meetings with a lot of companies who were interested in the business, but Fairstone's proposition was the one that stood out.
"They shared the same values as us in putting the client first. And what was incredibly important to me was the ability to keep running the business and to make sure that we had continuity – I wanted our clients to be able to be served by the same people in the same office doing the same things and the DBO process allowed us to do that."
Frank describes the DBO process as "like getting engaged": a firm signs up to Fairstone with an initial valuation for the business. There is then a transition period whose length is agreed by both parties before a full acquisition takes place and the firm becomes part of Fairstone.
"You sort of try each other out for a period and that really appealed to me – for example, we started off with dual branding so clients got used to the idea of a transition before it happened," explains Frank.
The unique nature of the DBO model allows firms to grow in partnership with Fairstone during the transition period so that both parties in the deal can benefit.
Frank says: "The support from Fairstone in terms of compliance and paperwork freed up probably a day and half a week for me to talk to clients and to grow the business.
"We also got assistance from Fairstone's customer acquisition programme, giving us access to new clients.
"That all made a huge difference to us and we increased our growth quite significantly – if I had been running the business without that help, we would not have been able to grow so fast."
Two years after signing the initial agreement, Andrew Cohen Associates' transition period ended and the firm was fully acquired by Fairstone.
Thanks to the unique structure of the DBO model, Frank was able to benefit from the firm's extensive growth when it came to finally selling up.
He explains: "I had targeted 10% over the original agreed value when it came to the earn-out phase but in the end it was almost 80% over, which was way more than I had anticipated and was just fantastic.
"The DBO model is a really good way to grow your business and achieve a better earn-out – if you grow the business then you get more when you sell."
While Frank's achievement is seriously impressive, he is by no means alone.
Every firm owner who has completed their buyout journey with Fairstone in the last two years has received at least 100% of the capital value agreed at the outset – in fact, the average earned has been 120%.
With such a track record, it is unsurprising that firms are joining the DBO programme at an increasing rate - over the past 24 months alone, Fairstone has welcomed 25 IFA firms into the group through the DBO model.
Added to 11 full acquisitions for the same period and a strong pipeline for 2025 and 2026, Fairstone remains firmly on track to reach its ambitious target of £40bn in assets under management by the end of 2030.
Frank has stayed with Fairstone in Saffron Walden as the office has continued to grow and his son Jonny has now joined the business.
"When I talk to clients now, I say we have been here for 27 years, we still operate from the same office with the same local knowledge, we just happen to be backed by one of the biggest and most trusted advisory firms in the UK," says Frank.
"I would definitely recommend the DBO route. It worked very well for me and for my business and we are still growing.
"We are living proof that DBO works and it works really well."
* To find out more about Fairstone's DBO model, contact Fairstone M&A Team Business Development Executive Euan Morris at [email protected], call him on 07425 817194 or visit www.fairstonegroup.co.uk
