Is It “Apocalypse Now” for Small to Mid-Sized Independent RIAs?
To Our Fellow WSR Community Members:
Happy Labor Day Weekend! I hope that this week’s new issue won’t be anything more than leisure reading, as everybody heads out to enjoy a well-deserved holiday before kicking off the autumn months.
Interesting side note: James Miller, Contributing Editor & Research Analyst, offered to take over this week’s Letters from Larry so I could “get my holiday weekend started sooner.” Nice try, James. I’m not eager for a repeat of his last guest contribution to this section of WSR (“Surprise! I’m Not Larry Roth”).
As we commence the final months of 2021, the pace of M&A consolidation, volumes of financial advisors in motion and pace of private equity dollars entering the wealth management space are all continuing to accelerate overall. In many instances, those of you hoping for a slower work pace during the summer months were disappointed.
But it’s not all about more deals, more recruiting and more dollars coming off the sidelines. When you look beyond the transactions and transitions, there is a potential sea change happening in the small to mid-sized RIA segment of the industry.
While the overall growth of the RIA segment will no doubt continue to accelerate, we’re beginning to see further signs of the segment’s maturation. This is evidenced in part by the rise of “aggregators of aggregators” among very large RIAs (think HighTower, Wealth Enhancement Group, CI Financial and Stratos Wealth Partners).
Meanwhile, in another sign of the RIA channel’s maturation, we’re seeing rapidly escalating interest among the owners of small and mid-sized RIAs who don’t want to sell their businesses just yet, but are seeking to maintain their independence while gaining more scale-driven resources.
In this week’s issue, we address these latest trends head-on:
- In our first of two Upmarket section stories, Janeesa Hollingshead, Senior Editor, presents our Ask the Experts Panel, with a focus on helping the owner of a small RIA facing rising costs and complexities decide what business structures could work best for him going forward. Great insights from Erinn Ford of Advisor Group, Nathan Stibbs of Continuum Advisory LLC, David Pittman of Strategic Blueprint and Jeff Nash of BridgeMark Strategies.
- In our second of two Upmarket section articles, Mark Contey of LaSalle St shares his thoughts on the rise of “tuck in” deals, and how these arrangements are providing RIA owners with the ability to wind down their RIA status while keeping their independence and business ownership intact.
- We’re also pleased to share with you the results of our latest WSR Reader Survey, compiled and presented by Michael Madden, Contributing Editor, on what our financial advisor readers think about the future of small to mid-sized RIA ownership. Check out our survey results in our Words in Edgewise section.
- Our other Words in Edgewise story today is our monthly WSR Real Estate Roundtable, presented by Phil Shoemaker of Homepoint, one of the country’s largest wholesale mortgage lenders. Phil brings together a select group of independent mortgage brokers who address some of the most pressing real estate-related questions that our financial advisor readers have shared with us, based on their own client conversations.
Labor Day is a terrific opportunity to not only enjoy some rest and recreation, but to also celebrate the fruits of all that you’ve worked for before we go into the concluding months of the year.
With that in mind, and on behalf of the entire WSR team, I’d like to say thank you to each of our WSR community members. August is historically a slower season for media platforms, but our traffic, page views and other key metrics actually tracked up slightly from July, itself a popular month for WSR.
Our five consecutive months of audience and engagement growth since our launch at the top of April this year is an achievement that we happily share the credit for with all of you, our WSR community members. The continuous feedback, recommendations and support that we receive each month have helped us offer something we’d like to believe is truly unique to the wealth management industry.
Thanks so much for your support, and have a great Labor Day weekend.
Larry Roth, CEO
Wealth Solutions Report