Transaction Advisory, Investment Management

December 16, 2019

Succession Planning for Investment Management Firms

Succession planning has been an area of increasing focus in the RIA industry, particularly given what many are calling a looming succession crisis. The demographics suggest that increased attention to succession planning is well warranted: a full 62% of RIAs are still led by their founders, and only about a quarter of them have non-founding shareholders. Yet when RIA principals were asked to rank their firm’s top priorities in 2019, developing a succession plan was ranked last. Fortunately, there are many viable options for RIA principals looking to exit the business.

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The Cost of Staying Independent
The Cost of Staying Independent

Sometimes Doing Nothing Is the Riskiest Choice

Remaining independent requires RIA owners to invest in future leaders, fund an ownership transition, and share authority. Delaying those commitments can increase risks for founders, employees, and clients, even when the business continues to perform well.
RIA Valuation Insights Blog Investment Management
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Skeletons in the Data Room: What Can Haunt an RIA Sale
Skeletons in the Data Room: What Can Haunt an RIA Sale
Client concentration, an aging client base, weak organic growth, founder dependence, and questionable earnings adjustments can complicate an RIA sale. Identifying and addressing these issues before due diligence helps owners protect transaction value and negotiate from a stronger position.
RIA Valuation Insights Blog Investment Management
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Alternative Asset Managers Face a Reset in Public Market Valuations
Alternative Asset Managers Face a Reset in Public Market Valuations
Alternative asset managers experienced a significant contraction in public-market valuation multiples through September 2026 despite continued growth in assets under management and revenue. The divergence between operating growth and market performance highlights the importance of profitability, recurring revenue, and firm-specific fundamentals when assessing asset management businesses.

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