This year has been the most active on record for RIA mergers and acquisitions, according to DeVoe & Co.’s 2025 RIA M&A Outlook Report, released Monday.
Many advisors are benefiting from high valuations, strong private equity interest and a diversity of strong buyers, and most expect M&A activity and valuations to increase further, the report said.
At the same time, foundational challenges persist, including succession affordability, leadership readiness, organic growth, cultural alignment and the responsible integration of technologies such as artificial intelligence.
More than 100 RIA executives participated in DeVoe & Co.’s 2025 survey, representing firms from $100 million to over $10 billion in assets under management. Respondents included principals, owners and senior leaders directly involved in strategic planning and decision-making.
According to the report, 67% of RIA executives see the lack of succession planning as a major issue, but only 22% believe that the next generation can buy them out.
The affordability gap continues to widen as valuations climb and equity concentrates with founders. This year, 36% of RIA leaders reported that their next generation cannot afford to buy them out. This statistic, DeVoe & Co. said, suggests that the longer that firms wait to start the planning process, the less likely an affordable internal path will remain.
A second challenge is complicating this problem. Only 27% of leaders believe that their next-gen team is prepared to lead. And 45% anticipate a “bumpy transition,” up from 34% in 2024.
These numbers indicate a deeper execution gap, the report said. Although some RIAs have made progress in planning for succession, far fewer have invested in preparing their successors to actually run the business.
Meanwhile, 11% of advisors consider the issue overblown, up from 1% a year ago. But this may be short-sighted, DeVoe & Co. said, as few firms can support an internal succession, while most find it out of reach.
Fifty-three percent of leaders reported organic growth as their top worry, way ahead of their next biggest concern, the effects of AI on the profession and their firm. Most industry studies on growth statistics, the report said, show RIA organic growth in the low single digits.
This concern now drives the behavior in M&A of both buyers and sellers; growth serves as the chief motivator of 79% of buyers and 49% of sellers.
The 2025 DeVoe survey found that after years of integration lessons, firms now view culture as the backbone of sustainable growth. Sixty-nine percent of acquirers cited culture as the attribute they most want in a firm, up from 17% a year ago, the first time since the survey’s rollout that culture has been on top.
Three years ago, it ranked last among the list of five buyer characteristics. In 2024, it sat in the middle, roughly on par with organic growth and profitability, while talent strength was the dominant consideration by a wide margin.
Eighty percent of advisors believe that AI will positively affect the industry, with 42% expecting meaningful improvements in advisor efficiency and client experience and 37% predicting transformational benefits. Only 2% view AI as a potential threat.
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