It’s a good time to be a seller of an RIA firm, at least a certain kind of RIA firm, according to the latest definitive research on mergers and acquisitions activity in the advisory market. Those are some of the takeaways from Real Deals 2008, the research conducted by Moss Adams on behalf of Pershing that takes up where its 2006 study left off. Summing up, the number of completed deals reached 58 in 2007, exactly double the number reported in 2003. However, through April 2008, only seven deals occurred. Multiples seem to be increasing slightly as well.
Mark Tibergien, CEO of Pershing Advisor Solutions, provided some insights into the study, and the entire business as per usual, in an interview with Editorial Director Jamie Green on June 2.
So it’s a good time to be a seller, though maybe things have slowed down lately?
It’s a good time to be a seller if you have a good business. It’s a bad time to be a seller if you haven’t invested in your business and lack growth and earnings potential.
The firms that are well run and positioned for growth will be more appealing to a Focus Financial or a United Capital? As opposed to a Ken Fisher approach?
That’s a good example of how, in the case of Fisher, it’s just another way of direct marketing, since he acquires a client list and can harvest what he wants. The elegance for Fisher’s offering is that it provides an option for people who just want out.
So is it a seller’s market?