By Mindy Diamond, Forbes.com – For employee advisors who are taking a “bigger picture look” at their business, here are 3 valuation scenarios to consider that can help you determine if where you are currently practicing will allow you to maximize value at the end of the day.
Wendy Leung Quoted – By Judy Ward, PlanAdviser – The rapid pace of advisory business merger and acquisition (M&A) deals will continue in 2022, experts say. “The pressures of COVID-19, and the potential change in the capital-gains tax rate, have really driven the outsized amount of activity we’ve seen this year,” says Wendy Leung, senior consultant at Diamond Consultants, a recruiting and business consulting firm for financial advisers, located in Morristown, New Jersey.
Kurt Miscinski shares how a serendipitous meeting with billionaire entrepreneur Howard Milstein led to the 2009 launch of HPM Partners. After starting from zero, the firm now Cerity Partners, manages over $31B in assets for ultra-high net worth clients and corporate executives.
Louis Diamond Quoted – By Charles Paikert, Barron’s – For owners of advisory firms considering entering the current M&A market for RIAs, it’s a good time to be a seller. Echelon Partners, an RIA consulting firm, recorded 205 transactions in 2020, a record high for the industry. That frenzied pace has continued this year, as demand for RIAs far outstrips supply: Investment bankers report one seller can attract as many as 20 or 30 interested buyers.
One of the major motivations for advisors who choose independence is to build an enterprise via recruitment and M&A. But inorganic growth opportunities are not exclusive to independent firms. Although more limited, wirehouse advisors have options too.
Louis Diamond Quoted – By Andrew Foerch, Citywire – Dynasty Financial Partners will begin making minority equity investments in its partner RIAs, entering the mergers and acquisitions market for the first time. Through a new initiative dubbed the Minority Investment Capital Program, Dynasty will use cash from its balance sheet to buy stakes of less than 50% in RIAs on its platform. Louis Diamond, president of advisor recruiting and consulting firm Diamond Consultants, said the move was a ‘natural evolution’ of Dynasty’s model.
Louis Diamond Quoted – By Lynnley Browning, FinancialPlaning – The acquisition frenzy for independent advisory firms may be about to get even hotter. That’s the thinking of some industry dealmakers, who predict that President Biden’s proposal for tax increases on the wealthy will pour fuel onto the already-hot market of deals to acquire RIAs.
Louis Diamond Quoted – By Peter Rawlings, Financial Advisor IQ – Some smaller broker-dealer firms are trying to peel away advisors from firms being gobbled up by large networks amid the ongoing industry consolidation, according to an executive at LaSalle St. Securities. Louis Diamond, president of recruiting firm Diamond Consultants, says many advisors tend to either stick with their parent or look to move to an even larger firm despite the potential benefits of smaller firms, such as better access to management.
By Louis Diamond, CityWire.com – In years past, a $1B+ independent firm would have automatically considered themselves a legitimate buyer. But today, with the red-hot M&A market spurred by scores of private equity capital, serial acquirers, and the emergence of mega-RIAs boasting a full suite of comprehensive client services, AUM is no longer a predictor of buyer status.
An exploration of the 2020 Schwab RIA Benchmarking Study with Lisa Salvi of Schwab Advisor Services. Beyond key trends, she shares the drivers and habits of top RIA firms, with actionable information for both advisors and independent business owners.
