Long Ridge Equity Partners is the latest private equity firm to buy into the independent advisory business. With a $35 million investment it is taking a stake in Carson Group Holdings, which includes Carson Wealth Management Group, a $6.5 billion RIA headed by Ron Carson, one of the industry's highest-profile executives.

Ron Carson, one of the RIA industry's highest-profile executives.
Ron Carson (Image: Ron Carson)

The deal, which includes participation from members of Carson's executive leadership team, gives the New York-based PE firm a 29% interest in Carson Group. Ron Carson, who is expected to become a more aggressive acquirer of other RIAs with the new infusion of capital, owns the remaining shares in Carson Group Holding and will continue to run the firm.

"Private equity continues to vote with its checkbook that the independent model is one of the best ways to serve investors," says David DeVoe, managing partner of the San Francisco-based consulting and valuation firm specializing in mergers and acquisitions. "The Carson transaction is yet another indication that a strong RIA with PE backing is a likely acquirer in the future."


The deal follows a string of investments in large RIAs by prominent private equity firms over the past 15 months, including Genstar Capital's stake in Mercer Advisors and Lightyear Capital's stake in Wealth Enhancement Group. Long Ridge has previously invested approximately $400 million in other financial service companies.

Private equity firms are increasingly viewing financial advisory firms as investment vehicles with high growth potential, and have given the green light for firms they invest in to go out and buy other larger companies. Mercer recently bought the Houston-based firm Kanaly Trust and in March Wealth Enhancement Group purchased HHG & Co., a Connecticut-based RIA with over $1 billion in assets.

Indeed, the just released Nuveen/DeVoe & Co. RIA Deal Book notes that RIAs funded by PE firms were among the biggest buyers of wealth management companies with over $1 billion in assets under management in the first quarter of this year.

As part of the deal, Carson Wealth Management Group and Peak Advisor Alliance, a coaching and resource company for advisers, have been reorganized under a new parent holding company, Carson Group Holdings. Jim Brown and Kevin Bhatt of Long Ridge Equity Partners will join the Carson Board of Directors.

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Charles Paikert

Charles Paikert

Charles Paikert is a senior editor at Financial Planning. Follow him on Twitter at @paikert.