Latest news with #SuccessionPlanning
Globe and Mail
13-08-2025
- Business
- Globe and Mail
What industry consolidation can teach advisors about their own succession planning and firm value
Succession planning has long been the Achilles' heel of the wealth management industry. Some studies suggest that 80 to 90 per cent of advisors have no formal succession plan – a startling gap for a profession built on planning for others. At the same time, the industry is experiencing an unprecedented wave of consolidation. The result? A perfect storm of capital, urgency and opportunity. Two recent transactions capture this moment: Bank of Montreal's acquisition of Burgundy Asset Management Ltd. and Sagard Private Equity Canada's take-private of Lorne Park Capital Partners Inc. (also known as Bellwether Investment Management). These are more than headline-grabbing deals. They reflect a profound shift in how value is being defined and who's best positioned to capture it. A feeding frenzy is underway in the Canadian wealth management space. Banks, independent dealers, private equity firms and consolidators are seeking exposure to high-margin, recurring, fee-based revenue. The demographics are on their side: more than half of Canadian financial advisors are over the age of 50, with succession planning looming large. But while capital is abundant, high-quality platforms are not. That's why deals like Burgundy and Lorne Park matter. They're not just M&A transactions – they're signals to the rest of the market about what gets rewarded. In Burgundy's case, the co-founders were remarkably candid. In an email to clients shortly after the sale announcement, Tony Arrell explained that their original intention had been to transition ownership internally. However, by the time they considered it seriously, the opportunity had passed: employees lacked the capital to fund a meaningful buyout, and the leadership was unwilling to dilute their long-held value-investing principles to attract outside financing. In the end, BMO offered what internal succession could not: a culturally aligned partner, liquidity through publicly traded stock, and a structure that preserved Burgundy's investment autonomy while ensuring long-term continuity for clients and staff. It's a story many founders know too well: they want to keep ownership 'in the family,' but the financial, operational and leadership handoff is rarely achievable without compromise. For firms that don't have Burgundy's scale or brand equity, it's even harder. Ask most advisors what their practice is worth and you'll hear a familiar refrain: two to three times trailing revenue. The widely accepted industry rule of thumb implies a 2- to 3-per-cent price relative to assets under management (AUM), assuming a 1 per cent average fee rate. But here's the catch. Burgundy, a firm with $27-billion in AUM, just traded at 2.3 per cent, while Lorne Park, with $3.9-billion in AUM, traded at 3.9 per cent of AUM. These are full-firm transactions with sophisticated infrastructure and recognizable brands. So, why would a large wealth management firm pay an advisor 3 per cent of AUM to buy their book when other firms are only trading at 2 to 3 per cent? The truth is, they might. But it won't be because of an advisor's revenue multiple – it will be because of earnings before interest, tax, depreciation and amortization (EBITDA). Buyers are focused on what your business earns, not just what it brings in. If your practice generates strong margins, recurring cash flow, and has low advisor/key-person risk, it might justify a premium. If it doesn't, even 2 per cent of AUM may be a stretch. Firms with strong EBITDA margins, scalable operations and sticky client relationships are trading at 10 to 15 times EBITDA even if the AUM multiple looks modest. But for those running a lifestyle practice, in which profits are drawn down annually and the business revolves around a single advisor, then even a two-times revenue multiple may be generous. If you're an advisor or firm principal considering the next chapter – be it succession, retirement or recapitalization – now is the time to understand how buyers are evaluating value. Multiples are a starting point, not a finish line. The Canadian wealth industry is entering its next phase. Buyers are sitting on the sidelines, ready to act. However, value creation and capture belong to those who look beyond the headline metrics and focus on building enduring, cash-generating businesses. The lesson from Burgundy is simple. Succession is not optional; it's a matter of timing. The difference is whether you drive the process or respond to it. Joe Millott is a partner at Fort Capital Partners, an independent investment bank that specializes in wealth and asset management mergers and acquisitions, with offices in Vancouver, Calgary and Toronto.
Yahoo
24-06-2025
- Business
- Yahoo
RISR and The American College of Financial Services Unite to Help Advisors Drive Better Outcomes for Business Owners
New partnership equips advisors with financial education and free access to RISR's business insights, helping business owners plan successful exits and legacies PHILADELPHIA, June 24, 2025--(BUSINESS WIRE)--RISR, a leading business owner engagement platform for financial professionals, today announced a strategic partnership with The American College of Financial Services ('The College'), the nation's largest nonprofit educational institution devoted to financial services. This collaboration will enhance how financial advisors serve business owner clients by combining specialized education with powerful technology. The College's mission is to provide applied financial knowledge and education, promote lifelong learning and advocate for ethical standards to benefit society. It's a mission rooted in history and focused on the profession's future. This partnership with RISR brings that mission to life by pairing expert instruction with actionable tools to meet the complex needs of today's business owner clients. As part of the collaboration, financial advisors who complete The College's Business Succession Planning Certificate Program will receive complimentary access to a business insights report from RISR—a robust, data-rich overview that helps advisors uncover valuation, risk and growth opportunities for business owner clients. This benefit is designed to immediately translate the certificate's learnings into real-world client impact. "Advisors working with business owners are in a unique position to influence outcomes that directly impact retirement, legacy and generational wealth," said Jason Early, founder and chief executive officer of RISR. "This partnership with The American College of Financial Services puts the right resources in their hands—specialized education and technology-enabled insights—so they can step confidently into their role as planning leaders during critical transition moments." Over 70 percent of privately held businesses are expected to change hands in the next decade, yet most business owners are unprepared to exit successfully. This knowledge gap presents a major opportunity—and responsibility—for advisors to step in and guide their clients through these life-changing transitions. "Knowledge without action leaves potential on the table," said Jared Trexler, senior vice president, chief marketing and strategy officer at The College. "This partnership bridges education and execution, arming advisors with the requisite tools to meet rising market demand for business planning and succession guidance." This initiative reflects both organizations' commitment to elevating advisor impact and improving outcomes for business owners, who are key contributors to the U.S. economy. By making high-quality resources more accessible, the partnership aims to drive better decision-making, smoother transitions and more secure financial futures. Financial professionals interested in comprehensive planning engagement tools for business owner clients can book a demo with RISR here. Professionals interested in The College's Business Succession Planning Certificate Program can learn more here. About RISR Founded in 2024 and backed by financial industry veterans, RISR is a first-of-its-kind engagement platform designed to empower advisors and the business owners they serve. By providing deep insights into valuation, growth opportunities, risk assessment, and more, RISR helps advisors deliver more impactful advice. Its platform supports succession and exit planning, estate and legacy planning, retirement planning, insurance coverage, tax planning, and capital and liquidity planning. RISR is committed to unlocking growth for advisors and ensuring the success of small business owners who form the backbone of the U.S. economy. For more information, please follow RISR on LinkedIn or visit About The American College of Financial Services Founded in 1927, The American College of Financial Services is the nation's largest nonprofit educational institution devoted to financial services professionals. Holding the highest level of academic accreditation, The College has educated over 200,000 professionals across the United States through certificate, designation, and graduate degree programs. Its portfolio of applied knowledge also includes just-in-time learning and consumer financial education programs. The College's faculty represents some of the foremost thought leaders in the financial services industry. Visit for more information. View source version on Contacts MEDIA CONTACTS: StreetCred PRRISR@ Audrey Love865-253-6082Audrey@ Jimmy Moock610-304-4570Jimmy@ Jared Sarah Tremallo908-967-0381Stremallo@ Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
