Private equity firms are fueling a once-in-a-generation consolidation in the wealth management industry, targeting firms with recurring revenue, high client retention, and potential for growth through acquisitions. Aging founders and senior executives are retiring, creating opportunities for PE-backed acquirers to expand portfolios and accelerate M&A activity. Firms like Allworth Financial have leveraged PE backing to pursue serial acquisitions, growing from $2.8 billion in assets in 2018 to over $15 billion today.
Globally, private equity and portfolio companies supported 48 wealth management deals totaling $6.7 billion in the first half of 2022 alone, with activity on pace to surpass last year’s record 82 deals. Strategic buyers with PE support accounted for nearly 55% of acquisitions, including Creative Planning, Beacon Pointe, and Mercer Advisors. With over a third of advisors expected to retire in the next decade—and many lacking succession plans—PE-fueled consolidation is expected to remain a key driver of growth and industry reshaping.