Private equity’s expanding footprint in RIAs: What advisors need to know for 2026

Private equity has become a key factor in the RIA landscape, but how is its influence reshaping deal structures, buyer behavior, valuations, succession planning, and long-term strategy?

Corey Kupfer is founder & managing partner of Kupfer PLLC, a law firm that specializes in working with RIAs on M&A, tuck-ins, breakaways and succession planning. He’s been telling InvestmentNews how the market has evolved and what advisors should prioritize next.

And while PE’s growing role has unquestionably changed the mechanics of RIA transactions, Kupfer says the deeper impact goes beyond headline valuations.

“While it has certainly increased valuations, provided a higher percentage of the purchase price at closing than used to be the case, made pretty standard having a roll-over equity part of the deal, locked in 2-year retention requirements in most deals, and made several year earnouts with growth CAGRs in the 15% range common,” he says. “I think the more interesting impact of PE is on RIA business models including the push toward fully-owned, single-brand integrated and consolidated business models with strong organic growth.”

Kupfer points to the business models of firms like Focus, HighTower, Edelman, Carson, and others since they have taken on PE as evidence of the impact of the investments.

The rise of the sophisticated buyer

Buyers today look very different from those of even a few years ago. Kupfer points to institutional maturity as the key differentiator.

“They have built out their corporate development, deal and integration teams and created well-oil process driven procedures and project plans that help with speed to close, efficiency, professionalism, and success,” he says. “They have honed their value propositions, worked to build increased brand equity, created stronger organic growth capabilities and inorganic growth consulting and strategic value for advisors, and have expanded their offerings to capture more wallet share from clients and create stickier client relationships.”

Despite competitive pressure, Kupfer does not see major valuation shifts on the horizon.

“Valuations have held pretty steady over the last year or two and I expect that to continue into 2026,” he says. “The serial acquirers are very sophisticated in their underwriting. So, although, there is usually some room for negotiation, it’s not likely a seller will convince a buyer to underwrite a deal materially differently on the same numbers.”

Instead, value must be built well in advance. Kupfer emphasized that enhancement comes from “having strong organic growth (not counting market), having quality G2 and G3 advisors at the firm who have been appropriately, equitized or otherwise incentivized to stay with the firm over time and transition to the buyer, building a strong management team, the firm not being overly dependent upon the founders, having a client base that is not on average too old, and not having material concentration risk in one for a few clients.”

As more advisors level up earlier, the foundations of growth matter more than ever and Kupfer’s framework starts with intention.

“Structure for growth from the beginning, get clear on why and how you want to grow, figure out who you are targeting, create a clear and compelling value proposition/differentiator that will have advisors/RIA firms be attracted to you,” he says. “Build/work with an experience deal team, create a model for the way you are doing to do deals that aligns with and is an expression of your why, who you are targeting and our value proposition, then create the deal structure within that model.”

Choosing the right growth path requires context, not shortcuts.

“Tuck-ins are usually full acquisitions (just smaller) as opposed to minority investment deals or recruiting deals. All of these are potential ways to grow,” Kupfer says. “I can’t properly advise firms on these decisions until I know their why, who they are targeting, value proposition, and composition of their development, deal, and integration teams.”

Ultimately, “the decision on which of these options make sense is a key part of the building the model for each firm.”

The retirement wave that never quite came

The long-anticipated advisor retirement boom has been slower than expected and Kupfer explained why.

“I and most of the investment bankers, consultants, other attorneys and key players in the RIA space have been talking about the demographics, aging, and potential retirement of advisors for over 15 years and the predicted retirement boom has not happened at close to the levels generally predicted,” he says. “In the early years, it was more due to the lack of capital and access to capital for next gen advisors for internal succession deal.

This was followed by a brief period when lending helped, before PE-backed acquirers changed the equation with significantly higher valuations and attractive deal terms and the result has been structural strain.

“Combining this history with the lack of enough younger advisors coming into the profession and the generally poor job of training and developing of younger talent by RIA firms in the past has created challenges for some sellers,” he says. “This has heightened the importance of hiring, training, retaining, and equitizing younger advisors, with those that do being much more attractive to buyers and much more highly valued.”

PE capital has also shaped perceptions around succession, but not always productively.

“It has given some advisors the misimpression that you don’t need internal successors as you can have a lucrative exit externally these days,” Kupfer warns. “The truth is that taking the right steps (especially finding, training, retaining and equitizing next generation advisors), puts RIAs in the best position for both internal succession and external sale.”

Common early-stage mistakes

Missteps in the early years can undermine long-term value and Kupfer sees several patterns repeat.

“Especially when they don’t have significant capital, they sometimes give too much equity away too early,” he says. At the same time, “they don’t create formalized attraction, retention, and incentive programs to properly find, retain, incentive next generation talent to come, stay, and help the firm grow.”

Ad hoc dealmaking can also backfire. “They start doing deals one off with no clarity on their model and structure and end up overcomplicating their cap tables, financials, and operations and becoming less attractive to buyers,” Kupfer explains. “Especially when the market is going up, they don’t focus on true organic growth. The best firm have both strong organic and deal-driven growth.”

Despite macro uncertainty elsewhere, Kupfer expects continuity in RIA deal terms into 2026.

“I think it is going to be a lot more of the same. I don’t see significant market factors or regulatory pressures materially impacting the market,” he says. While lower interest rates could help, “the RIA M&A market (unlike many other industries) has been so robust already with significant competition for deals, and a comparative limited number of attractive sellers. I see the reduced cost of capital having a much bigger impact on the M&A market in other industries than in the RIA space.”

For RIAs intent on remaining independent, Kupfer’s advice centers on relevance and differentiation.

“Stay close with their clients, emphasize value propositions that distinguish them from the PE-backed serial acquirers, and stay up with the times in terms of the client experience, technology, and clients’ desires and needs,” he says.

Meanwhile, as larger firms broaden their offerings, independents must adapt: “Look at how you can expand services and investment options to keep up with client needs either by building these capabilities internally or by partnering with trusted firms that have those services and investment options,” he says.