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M&A Activity Among RIAs Remains Strong


The wealth management industry continues to attract attention from private-equity firms, banks, and family offices, as evidenced by the robust M&A activity among registered investment advisors (RIAs). According to a recent report from boutique investment bank Echelon Partners, even though deal volume dropped by 15% in the second quarter, with 65 announced M&A deals compared to the preceding period’s 75, it was still the most active second quarter in the industry’s history.

A Favorable Landscape for Big Deals

One notable trend is the persistence of deal making for firms with $1 billion or more in assets under management (AUM). In 2023, nearly half of all transactions involved such large-scale firms. Echelon Partners reports that the average assets per deal inked last year reached $1.7 billion, showing a slight increase from $1.6 billion. However, this figure fell short of the record-setting $2.1 billion in 2021. Looking ahead, based on current trends, the investment bank expects to see approximately 300 total deals in 2023 (compared to 341 in 2022). Furthermore, the number of $1 billion-plus transactions is projected to grow to 132 this year, surpassing last year’s count of 118.

Continued Appeal to Investors

The persistently strong M&A activity in the RIA space reflects the ongoing attractiveness of the wealth management industry to various types of investors. Private-equity firms, banks, and family offices have been actively deploying capital in this sector and have thereby contributed to the growth of RIA aggregators.

In conclusion, although deal volume decreased slightly in the second quarter of this year, the M&A activity among RIAs remains robust and illustrates the enduring allure of the wealth management industry to a diverse range of investors. The continuation of big deals involving firms with $1 billion or more in AUM further underlines the attractiveness of this sector.

Midsize RIAs Seeing Increase in Deals and Average Assets

Alongside the recovery in capital markets, prominent midsize RIAs are completing deals with new financial partners, helping to increase average assets per deal, according to a report by Echelon. This trend is evident in recent acquisitions made by Wealth Enhancement Group (WEG) and Beacon Pointe Advisors.

WEG’s Acquisitions

In April, WEG acquired New Era Financial Advisors, a registered investment advisor with $1.1 billion in assets. This transaction followed WEG’s previous acquisition of Equius Partners, an RIA based in Novato, Calif., with over $1 billion in assets. It is worth noting that WEG has been recognized among the Top RIA Firms for 2022.

Beacon Pointe’s Expansion

During the same month, Beacon Pointe acquired YorkBridge Wealth Partners, an RIA overseeing more than $1 billion in assets. This acquisition expanded Beacon Pointe’s presence in the New York metropolitan area. With its headquarters in Newport Beach, Calif., Beacon Pointe manages over $26 billion in assets under advisement and has also been listed among the Top RIA Firms for 2022.

Other Active Firms

While WEG and Beacon Pointe lead the way, other firms are also making significant moves. Carson Group, for instance, recently completed its largest deal yet by acquiring Northwest Capital Management, a retirement and investment advisory firm with over $5 billion in assets.

The increasing number of deals and rising average assets per deal demonstrate the growing momentum and competitiveness within the midsize RIA space. As the year progresses, it will be interesting to see the further developments in this dynamic industry.

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