Corporate Valuation, Investment Management

October 2, 2017

Recent Trends in Asset Management

This week, we’re sharing some recent media on trends in asset management, including the breakaway broker phenomenon, M&A activity, and the ongoing shift towards passive products.  Most industry observers foresee a continued flight from traditional wirehouses, an uptick in M&A activity spurred by increasing competitive pressures, and further fee pressure from passive products as we move towards a new equilibrium. 

Switching From Wirehouse to RIA – AUM And Revenue Requirements To Break Away

By Michael Kitces We wrote last month about advisors shifting from traditional wirehouses to independent RIAs, and this post by industry consultant Michael Kitces offers a deep dive into the economics of the switch from an advisor’s perspective.

RIAs Poised to Land Wirehouse Recruits

By Dan Jamieson Going independent doesn’t have to mean starting from scratch: wirehouse advisors are increasingly a recruiting channel for existing independent RIAs, according to this piece by industry observer Dan Jamieson.

Advisor Platform Comparison: Wirehouse vs RIA Aggregator vs Independent RIA

By Aaron HattenbachIn this guest post which appeared on Michael Kitces’ blog, industry insider Aaron Hattenbach offers perspective gleaned from his own experience on the relative merits of wirehouses, RIA aggregators, and fully independent RIAs, each of which he has worked at.

UBS is ‘Constantly Approached’ About Asset-Management Unit

By Patrick WintersThis article from Bloomberg underscores the potential for a new wave of deals in the asset management space: UBS Chief Financial Officer Kirt Gardner indicates that UBS is “constantly approached” regarding its asset management unit.

Path to Growth: Why RIA firms leverage M&A as a growth strategy

By Christopher V. Gunderson Increasing operational and compliance costs combined with downward fee pressure may be forcing consolidation in an industry where historically M&A activity has been sparse: according to a survey by InvestmentNews, 44% of RIAs plan to pursue M&A deals over the next five years.

Why Critics of Passive Investing Are Wrong

By: Kent Smetters Somewhere there’s equilibrium between active and passive asset management, and wherever that equilibrium may be, we are not there yet according to this WSJ piece by University of Pennsylvania Wharton School Professor Kent Smetters.

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Not All AUM Is Created Equal
Not All AUM Is Created Equal

Why Product Mix Matters in Investment Manager Valuation

Investment manager valuation depends on more than headline AUM. Fee rates, revenue durability, product-level growth, margins, and operating leverage all influence the quality of an asset base and the cash flows it can generate.
RIA Valuation Insights Blog Investment Management
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Changing Drivers
Changing Drivers

Thoughts on Compensation, Ownership, and Internal Succession

Successful RIA succession requires leadership, compensation, and ownership to evolve together over time. A gradual transition can align incentives, improve continuity, and give both senior and next-generation leaders meaningful participation in the firm’s future value.
RIA Valuation Insights Blog Investment Management
Read Now about Changing Drivers
The Sponsor Clock: What the Recapitalization Cycle Means for RIA Sellers Holding Rolled Equity
The Sponsor Clock: What the Recapitalization Cycle Means for RIA Sellers Holding Rolled Equity
Private equity sponsor timelines are bringing a new wave of recapitalizations to RIA platforms, with important implications for principals holding rolled equity. Understanding liquidity rights, valuation mechanics, and the timing of capital events can be critical to both transaction and wealth transfer planning.

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