RIAs have enjoyed a robust M&A market in recent years. Buyers, including private equity (PE) and PE-backed firms, have been willing to pay premium prices to quickly gain scale.
A recent report by Berkshire Global Advisors found that 2025 was the most active year on record for U.S. wealth management M&A, with 349 transactions involving RIAs managing more than $100 million in assets under management (AUM). That is significantly higher than the 276 deals completed in 2024.
But we are starting to see a more rational market. Some rationalization will be good for both buyers and sellers. For buyers, overpaying for mediocre to bad deals will expose their balance sheets to higher risk.
“Firms that have not kept up with technology, failed to meet advisor and client demands, or lack clear vision and passion for clients have been forced out of the market—a great thing for advisors,” said Nate Angelo, CEO at Composition Wealth.
For sellers, the shift may mean less focus on big paydays and more emphasis on strengthening their core businesses.
Buyer Beware
“In a ‘shrinking universe,’ smarter buyers can maintain discipline and higher standards,” Angelo said. “Acquiring ‘more’ assets is no longer the measuring stick of success; buyers are looking for well-led, strong-performing firms with an ability to grow organically. Advisor and client demographics are core to the evaluation process. Future-ready firms, built on a strong foundation, will be the sellers that capture the attention of a limited buyer universe.”
Pradeep Jayaraman, President of Bluespring Wealth Partners, agrees.
“While the number of independent buyers is shrinking, capital remains strong,” Jayaraman said. “What’s changing is the level of institutionalization: larger platforms are becoming more disciplined and selective. Scale alone doesn’t command a premium anymore. Buyers are prioritizing sustained organic growth, multigenerational leadership and strong operational infrastructure.”
Said Jeff Nash, CEO of Bridgemark Strategies: “I am not sure I am seeing fewer buyers, as I’m learning about new ones daily, but I would describe two categories of buyers: A’s and B’s. The A’s are doing significantly more deals per firm and are also more selective. They are frequently only interested in the similar A-quality sellers who check all the right boxes.”
Sellers Have Options
For potential sellers, it’s no longer sell the entire business or do nothing.
“There are some different business models providing nuanced options,” said Bomy Hagopian, a Partner with Berkshire Global Advisors who heads its Wealth Management Practice. “For a minority stake, there are capital partners and select strategic partners that seek minority stakes or have that flexibility. There are non-M&A affiliation models that preserve various levels of independence such as an affiliation with a platform services provider.”
Nash said PE-backed firms in particular have gotten creative on connecting with RIAs without outright buying them.
“They are essentially inventing ways to affiliate and often promising large future valuations and returns on equity,” he said. “The good news is there can be a choice for almost anyone. The risk is some of these firms may not achieve the long-term results they may be promising.”
Blurring The Lines
At the same time, it’s getting harder to tell the difference between M&A and outside affiliation, some experts said.
“The lines have blurred,” Nash said. “However, as we look into the future, I think about it as financial advisors servicing clients’ needs. As long as there are clients with needs, there will be large firms, and there will be smaller firms with one- and two-person teams.”
“In the end, I don’t see either of them ever going away,” he continued. “Clients will want to work with advisors and will trust people they know and like. The firm behind them is only one piece of the puzzle.”
Angelo of Composition Wealth said that affiliation can be an effective way for a buyer and seller to get familiar with each other before an actual sale down the road.
“M&A and independent affiliation can still be viewed as distinct categories,” Angelo said. “That said, one usually follows the other. Affiliation with a firm is a way to get a sense of the inner workings of a given platform. If it is a good fit, it may lead to a formal acquisition. At the same time, if it is not a good fit, it may lead to the acquisition of their practice at another firm.”
Seller Beware
“One thing is clear — with so many (affiliation) choices, it increases the risk for sellers to make sure they select the right one,” Nash said.
In the end, Jayaraman of Bluespring said a smaller group of buyers actually benefits the potential seller, even if it means a lower payout.
“A smaller group of buyers often means you’re partnering with more established platforms that have infrastructure and a track record of integration,” he said. “That can reduce execution risk. At the same time, more structural options allow sellers to tailor outcomes around liquidity, leadership and legacy. The trade-off is complexity, so clarity on alignment and expectations becomes critical.”
What Next?
These experts said we should expect to see these trends continue over the next two years: buyers demanding higher quality acquisitions and sellers placing a higher value on fit.
We will see “high prices for high-quality sellers, continued consolidation among advisors, but also increased consolidation among buyers as well,” Nash said. “One caution will be flight to quality by buyers. Sellers are going to see the headline numbers they’ve heard or read about, but it won’t be available to everyone.”
Jayaraman agrees.
“We see greater sophistication in deal structures,” he said. “Capital will remain available, but buyers will increasingly prioritize sustained organic growth, distributed leadership and operational discipline. Advisors will evaluate partners less on multiple and more on long-term strategic alignment.”
Said Angelo: “Having fewer, stronger, better-positioned firms that are collectively better positioned to meet clients’ evolving needs is a great thing—and a sign of maturation in our space!”
“Too often, people lose sight of why we exist: we are invited into the most intimate parts of clients’ lives,” he said, “and we (as an industry) should be doing everything we can to surround clients with a diverse set of experts and the necessary technology to ensure they receive the advice they deserve.”
Larry Roth is CEO of Wealth Solutions Report and Founder and Managing Partner of Ascentix Partners.
