RIAs bite their nails when deciding to sell the firm

RIAs bite their nails when deciding to sell the firm
Seventy percent experience anxiety over the decision, HighTower study finds.
DEC 11, 2019
Selling a registered investment advisory business is so stressful that 70% of RIA firm owners experience anxiety over the decision to sell, according to a study by HighTower, a firm that provides services to RIA firms. The study, which consisted of one-on-one interviews with advisers pre- and post-deal, found that 64% reported their top concern as losing operational control, 45% were anxious about losing or diluting their brand identity and 36% were worried that clients would react negatively. Nearly a third expressed concern about having to change aspects of their investment approach. [Recommended video: Bob Oros said HighTower is likely to start buying smaller firms, too] Every adviser in the study said they viewed culture and values as a top priority, and several said they would only consider a partner that could support an elevated, high-touch client experience, HighTower said in a release. The research showed that advisers are driven to sell their businesses for a variety of reasons: 50% said their primary motivation would be to capitalize firm ownership, 41% said they thought it would help streamline succession planning, 27% wanted access to capital for growth initiatives, and 27% hoped to gain a better technology platform.

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