Key Factors to Consider When Selecting a Capital Advisory Services Provider

Key Factors to Consider When Selecting a Capital Advisory Services Provider

Choosing the right capital advisory services provider can differentiate between success and failure. You’ll want to find one who understands the unique challenges facing small businesses and their owners.

Companies must produce credible and reliable financial statements and forecasts, whether raising capital via debt, equity, or retained earnings. This level of financial sophistication can be difficult for many business owners to possess.


As the independent advisory business has matured, so too have client options. The landscape varies widely, with firms differing in the type of client they’re best at serving, their list of services offered, how they invest, and even their compensation model. At the very high end, some advisors have begun to provide retainer arrangements, where a fee is charged annually based on the complexity of a client’s needs, which can include everything from advice on real estate holdings to the financial education of heirs.

Moreover, many advisors’ capital financial services have specialty practices. For instance, capital management serves employees of a particular employer and has built up expertise in their compensation and benefits. Some also serve clients who are LGBT and have a specific focus on funding adoptions or other forms of family creation.


Regarding fees, advisors are often cagey about the rates they may charge and why. This creates confusion for clients who aren’t sure what their total costs will be with an intermediary.

For example, a client with a large account could be charged a percentage of their assets under management (AUM), while smaller accounts are usually billed on a double-Lehman sliding scale. A client who doesn’t fully understand these fee structures can end up paying for out-of-scope work that will ultimately cost them more in the long run.

Having clear, upfront communication about fees is essential to avoid these issues. Advisors can do this by clearly defining their services, pricing, and scope of work in a proposal using Ignition. This can help reduce out-of-scope work and the risk of fee disputes.

Client Service

Capital Markets Advisor is often used to advise companies seeking an IPO and existing public companies raising equity through follow-on offerings, capital alternatives, 144a debt issues, or other related activities. These services offer high-touch advisory resources to clients navigating the debt and equity markets to raise capital to support their growth initiatives, including organic/acquisitive expansion and significant capital expenditures.


Following compliance rules is one of the most essential things advisors can do to protect themselves from regulatory trouble and liability with FINRA, the SEC, and state securities regulators. It can also help protect them from being sued by their clients.

Staying compliant can be challenging for any advisory firm, especially regarding cybersecurity and securing client assets such as cash, checks, security certificates, and account paperwork. Advisors must establish strict policies and procedures to ensure everything runs smoothly.

Then, advertising regulations can stifle an advisory business and limit what types of investments they can make available to their clients, such as mortgage-related securities. Fortunately, the financial industry has plenty of experts to help advisors find solutions.

Recommended Articles