RIA Valuation Insights

September 12, 2016 Current Events Transactions

If the Pathstone–Convergent Combo is the Shape of Things to Come

RIA Heads Need to Remember that MOEs are Tricky

When firms of similar size join forces to get a bigger footprint, solve leadership issues, stop advisors from competing with each other, etc. – realizing those benefits is the easy part. The hard work happens because different firms have different histories, and different histories create different cultures. Blending cultures can be awkward, as in MOEs (mergers of equals). This guest post, by Jeff Davis, provides a checklist of dos and don’ts for MOEs that will ring true in the investment management community.

September 5, 2016 Alternative Asset Managers

Twilio and the Rise Of Debt Financing

Unfavorable IPO market conditions have led many companies to alternative exits such as M&A, but a growing number of venture capital firms have also turned towards another source for cheap cash: debt.

August 29, 2016 Current Events

What Does the Market Think About RIA Aggregators? Focus Financial is About to Find Out.

Focus Financial Partners started preparing documents to file an initial public offering. While it may seem like a good idea on paper, we have many questions about the Focus IPO including: why now, how much, and how is this not a roll-up?

August 22, 2016 Current Events Practice Management

The SEC’s Proposed “Transition Plan” Requirement is One More Reason to Think about your Firm’s Ownership

By now you’ve probably read the SEC’s proposed rules on Adviser Business Continuity and Transition Plans. Most of the proposed rule simply codifies a reasonable standard for practice management at an RIA. Certain of the proposal’s requirements, such as IT management and being able to conduct business and communicate with staff and clients in the event of a natural disaster, are likely to be met with turn-key solutions from vendors. Of more interest is how the requirement for a “transition plan” in the event of the death or incapacitation of an advisory firm owner will be implemented.

August 15, 2016 Asset Management Industry Trends

The Market is Bearish on AUM Growth, but What if the Market is Wrong?

We have written at length about bearish signs in the RIA space, and valuation metrics seem to generally reflect a reduced growth outlook. We wonder, though, if things are really that bad. While, we suspect there is, over all, some phantom fee compression in the industry as assets are allocated to passive instruments and active managers who charge more don’t get the RFP they once would have, the other two themes focus on demographics and market outlook which are not, necessarily, bearish for the investment management space.

August 8, 2016 Current Events

Q2 Management Calls Were More “Interesting” than Usual

Management calls are usually, for the most part, fairly mundane. It’s usually not a good sign for a call to be “interesting”, and this quarter we picked up on several “interesting” themes.

August 1, 2016 Alternative Asset Managers

SEC Regulation May be Coming for the Private Market

In for a Dime, In for a Dollar

Recently, SEC Chair Mary Jo White gave a keynote speech to attendees of the SEC’s and Rock Center’s Silicon Valley Initiative, an event bringing together regulators, academics and entrepreneurs to discuss issues affecting venture capital and private equity within Silicon Valley. Although the audience may have been targeted, White’s speech provides insight into the SEC’s concern over the lack of transparency, governance and oversight in the PE and VC industries.

July 25, 2016 Current Events Transactions

BlackRock Sees Opportunity in Challenging Environment for Asset Managers

A Whole New World

Often branded as an industry bellwether for its size and breadth of services, BlackRock has been as solid as the name would imply given the recent fallout in asset manager valuations. How has it found an opportunity despite industry headwinds and the sideways market?

July 18, 2016 Industry Trends

Asset Managers of All Shapes and Sizes Continue to Underperform the Broader Indices

Nowhere to Hide

Piggybacking off our post from a couple of weeks back, the downward trend in asset manager pricing has persisted for another quarter, no matter how you slice it. Publicly traded trust banks, alt managers, mutual funds, and traditional RIAs are all down over the last year, with hedge funds and PE firms leading the plunge.

July 11, 2016 Alternative Asset Managers Current Events Transactions

AMG Sees Opportunity in Alt Asset Space

Value Play or Falling Knife?

Last week, Affiliated Managers Group (ticker: AMG) announced the completion of its investment in three alternative asset managers – Capula Investment Management LLP, Mount Lucas Management LP, and Capeview Capital LLP. This post discusses this transaction against the dim alternative asset management market environment.