With news Tuesday that Atria Wealth Solutions is buying Next Financial, some industry watchers are wondering what the parent firm will do as a follow-up act.
The Next purchase is Atria’s fourth since it was formed in 2017. Once complete, the group should have more than 1,900 independent advisors and about $65 billion in total assets.
“With Atria now owning a bank channel (Sorrento Pacific), credit union (CUSO Financial) and now two independent broker-dealers (Cadaret Grant and Next), they are looking increasingly similar to Cetera’s model with broker-dealers filling different channels but dominated by independent broker-dealers,” said recruiter Jon Henschen in an interview.
“It is not clear yet where Atria wants to take the broker-dealers, be it a short-term play of two to four years and flipping the firms for profit, or growing larger scale and going public with a timeline of five to nine years,” Henschen added.
But Atria — which has the financial support of Lee Equity Partners — insists it wants to forge its own path.
“We are not following an acquisition strategy,” said Atria CEO Doug Ketterer in an interview. “We are building something unique and want to be different in how we serve financial advisors.”
While scale is “the nature of the beast” when it comes to growing a business, hiring and building a platform for digital engagement, Ketterer admits, Atria’s vision “is not [just] that.”
Advisors traditionally have turned to BDs as “a utility through which they do business, get things done, etc.,” he explains. “Today, the world has changed, and advisors increasingly need a partner to give them resources, support, practice management and up-to-date platforms.”
Along with the technology, Next’s advisors should be able to benefit from Atria’s work in credit unions and banks. “We have seen the hypotheses come true in Technicolor with Cadaret Grant and expect it to do so for Next,” he explained.