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The price of acquiring 100% of firms that have reached valuations of $5 million, $10 million and above is “one of the big hurdles and big topics today,” according to Mangone. The Woodlands, Texas-based company serves as a conventional lender to independent advisors and RIAs seeking to make acquisitions, go independent, switch broker-dealers or create succession plans.
In the interview, Mangone explains

The phased succession transactions include ideas like starting a new partner at a 10% stake in the practice or, in the future, when a 20% equity holder picks up the remaining 80%. Regardless, the point is “allowing that next generation to acquire equity” in a way that minimizes the risk to all parties, Mangone says.
“It’s likely going to be difficult for advisors who have never had equity, never had ownership, to buy 100% of the firm,” he says. “That could be hugely beneficial because you don’t have such a major change within the operations of the firm, but you do get the younger advisors who have the opportunity to acquire equity, pay down debt and start to grow their wealth so that they are better positioned to make a much larger purchase down the road.”