Dynasty Financial Partners to go public through $100M IPO

An RIA and turnkey asset management platform backed by some of the biggest names in wealth management is inviting the public to invest alongside them.

Dynasty Financial Partners filed a Form S-1 with the SEC on Jan. 19 seeking to raise $100 million in an initial public offering for the St. Petersburg, Florida-based firm spanning a network of 46 RIAs with 292 financial advisors and $65 billion in client assets. While the firm’s revenue doesn’t approach that of the largest wealth managers, its business is growing rapidly after securing investments in 2020 from Mariner Wealth Advisors CEO Marty Bicknell and Envestnet.

“We provide financial advisory firms with a full suite of technology-enabled solutions necessary to operate their businesses independent from a large financial services firm,” according to the filing. “As the industry and the end-clients served by the industry continue to favor independent financial advice, we believe that our comprehensive set of business solutions provide advisors a single, holistic platform to enable their firms to be fully independent and empower them to gain market share as more investable assets flow into independent wealth management channels.”

The IPO represents a milestone for the firm launched by CEO Shirl Penney, 44, in 2010, as well as an industry that has seen the RIA movement expand massively over the past decade.

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Dynasty’s revenue soared by 50% in the first three quarters of 2021 to $49.2 million, while its net income surged by 273% to $10.6 million and its adjusted EBITDA jumped by 240% to $12 million, according to the filing. Since 2015, Dynasty has supported the launch of 22 RIAs with more than $500 million in client assets, including 14 with at least $1 billion. In 2019, Dynasty moved its headquarters from New York to Florida. Penney earned $712,000 in total compensation for 2021, according to the filing.

While Dynasty’s offering comes four years after RIA consolidator Focus Financial Partners went public at a similar size, private equity deals have emerged as a much more frequent source of capital across the industry in recent years.

In a session at the firm’s conference in November after Dynasty unveiled a new referral program for the network of RIAs, Penney said that he’s “very proud of the history of innovation” at the company. It began with “our core business, that desktop technology, that wealthtech business providing middle [and] back-office support” and subsequently added a TAMP, capital programs and the leads service after advisors requested the extra layers of support, Penney said.

“We are going to significantly invest in the program and as it builds momentum and traction, we're going to continue to lean in and make a further significant investment in it because we feel, at a time when more investors need financial advice, there are fewer and fewer advisors in our industry to provide it,” Penney said. “One of the ways to improve financial wellness is not through selling products, it's through giving quality advice. And we are very excited to be able to shout from the rooftops and hopefully have significant success here, which will fuel more success in getting more people [and] more institutions connected with high-quality independent financial advice and advisors.”

Penney didn’t mention any plans for an IPO at the time, although the firm filed confidentially in September. The S-1 filing didn’t disclose any pricing terms for Dynasty, which will use the ticker symbol “DSTY” on Nasdaq. Dynasty's target of $100 million will likely change, based on investor demand.