JPTD consults on a $5m all-in-offer* for a $950k Hybrid RIA team
Practice Background
Our client is an independent RIA established in 20009 in the Northeast United States that focuses on asset management and comprehensive Financial Planning for their clients. This business has a very efficient and lean operation that has been growing year over year with a well-trained support staff.
Client Objective
Our client was seeking the opportunity to partner with a larger firm to help support the growth of the business and provide back-end operational support to free the advisor up to spend more time client-facing. The owner was very focused on selecting a partner that had a strong growth track record and a predictable growth rate on the equity position negotiated in the deal.
Key Data
Top line revenue - $950,000
EBITA - $500,000
5-year CAGR - 12%
Years in biz - 20+
95% Fee Based
All-In Offer* Highlights
Headline price - $5,096,000
Paid at time of closing - $4,000,000
(60% Cash, 40% Equity in firm with all rights and privileges)
Base Salary - $360,000
5-Year All In - Growth on 40% Equity at 11% CAGR = $1,096,000
($2,696,093 total value of equity at 5 years)
Cumulative multiple of current revenue - 5.4X
Cumulative multiple of current EBITA - 10.2X
*An All In Offer includes any money paid upfront, signing bonus, salary and potential earn-outs based on growth. It does not include retirement or overrides on production. Assumes you hit all required transition, retention and growth expectations.