A weekly update on issues important to the Investment Management industry
Schwab’s announcement that they’re halving client referrals to RIAs through the SAN program threatens an industry that was already struggling with organic growth. Dependable, sustainable growth requires building a marketing strategy that isn’t dependent on outside factors like ambitious custodians, and a tracking system to know how that marketing strategy is performing. Keeping an eye on your metrics will help keep you on the road to lasting value.
RIA M&A activity rebounded sharply in 2025, with record deal volume in the first half of the year. Through September, 209 transactions were completed—up from 156 in 2024—driven by private equity involvement, lower borrowing costs, and ongoing consolidation trends. While total transacted AUM declined, serial acquirers and aggregators continued to dominate deal flow. For RIAs, shifting rate dynamics, valuation trends, and evolving buyer profiles highlight the importance of strategic planning—whether pursuing growth, transitioning ownership, or exploring a sale.
After several years of industry-leading performance, alternative asset managers have begun to lose momentum in 2025. Despite strong fundamentals, these firms have underperformed broader markets amid higher-for-longer interest rates and shifting investor preferences toward liquidity. While short-term valuations have softened, the long-term case for alternatives remains intact, supported by their structural advantages and ability to navigate volatility.
RIAs delivered mixed results in Q3 2025, with larger asset managers leading the sector at an 11% quarterly gain, outpacing the S&P 500’s 8% return. Smaller managers rose modestly, while alternative managers continued to lag after a stretch of strong growth in 2023 and early 2024. On a year-over-year basis, traditional managers remained ahead of the index, while alternative managers posted the strongest revenue and EBITDA growth despite muted price performance. We explore further in our Q3 2025 Market Update.
Clear communication is essential in family business governance, yet shared definitions are often overlooked. That’s why the UHNW Institute’s new Wealthesaurus caught our attention. This online glossary brings clarity to the complex vocabulary of family wealth and enterprise conversations. This resource also provides standardized definitions of common and specialized family wealth advising industry terms. For directors, it’s a valuable reference that supports informed decision-making and effective dialogue across generations.
Private equity continues to reshape the RIA landscape in 2025, fueling record deal activity and driving consolidation at an unprecedented pace. With 132 transactions in the first half of the year totaling $182.7 billion in AUM, PE-backed firms now account for more than half of all acquirers. Their disciplined “buy-and-build” strategies, focus on scalability, and willingness to pay strategic premiums are redefining ownership dynamics and valuations across the sector. For RIA owners, aligning with PE’s playbook offers both opportunities and challenges in unlocking long-term enterprise value.
Independent trust companies are in short supply compared to the thousands of RIAs, yet demand for their capabilities is rising. For wealth managers, acquiring trust services enhances client retention, attracts larger and more complex relationships, and secures multigenerational ties. This supply–demand imbalance suggests trust companies may carry a real “scarcity value” in today’s market.
In the late spring of 2015, Brooks Hamner and I were having lunch and started talking about creating a blog to explore what we were seeing regarding valuation and advisory projects in the RIA space. The big question was not whether we could start it, but whether we could keep it going.
Most blogs start strong for a few months and then kind of fade out. When we got back from lunch, I pulled up a Word doc and Brooks and I started brainstorming topics. In a few minutes, we had several dozen ideas, so it was pretty clear we had enough to say.
Ten years later, we still haven’t run out of ideas.
Looking back, though, we do see a few themes on heavy rotation. I doubt that will change.
Independent trust companies are gaining momentum in 2025, offering high-net-worth clients flexible, client-focused solutions outside the constraints of traditional banks. As the $68 trillion Great Wealth Transfer accelerates, these firms stand out for their personalized services, regulatory agility, and tech-driven client experience—positioning them as key players in the evolving wealth management landscape.
In the investment management world, evaluating a firm’s margin isn’t as simple as “more is better.” For RIAs, margin reflects efficiency, but it also reflects the firm’s tradeoffs with compensation. Investment management is a talent business, and striking the right balance between margin and employee compensation that allows the firm to attract, retain, and incentivize talent is critical to an RIA’s success. Read more in this week’s post.
