Reinventing M&A in the RIA World

Much has been written on the significant amount of M&A activity in the RIA space. Firms are being acquired at a record pace and for all time high multiples. Backed by a massive amount of private equity money, many RIAs and “roll ups” can tout incredibly impressive growth rates.

AdvicePeriod’s revenue has grown at a compound annual growth rate of over 70% for 3 years. In that same time span, our AUM has more than tripled. We’ve added 20 producing advisors in the last 20 months – many of whom folded their RIA business in to ours.

What have we paid to acquire this growth? Nothing. Zero. Zip.

It’s not a question of how we did it, it’s a question of why we did it.

• We believe the best companies are made of missionaries, not mercenaries. Missionaries are inspired by a vision that is bigger than themselves and more important than money. Mercenaries work for a paycheck. We do not want to buy an advisor’s allegiance. We want to work with like-minded advisors who share our beliefs – who share our mission.
• If there is not a cultural fit, nothing else matters. Often, the hardest part about a merger is combining the cultures of different teams. Pride, ego, and poor communication regularly hamper even the most well intended integrations. We don’t want to deal with that. We want to work with advisors who opt in to our team and want to be with us.
• Our advisors own their businesses. They earn 70% of the revenue they generate and can leave with their clients at any time. Our interests are aligned with our advisors. If we do not make AdvicePeriod awesome, our advisors will leave.

Multi-million-dollar purchases of RIAs make great headlines. But you can’t buy a championship. The best RIAs will be built from the ground up by a passionate group of client first advisors committed to reinventing wealth management. Are you in?