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In the past few years, something has shifted in how RIA firms talk about the future.
Selling your RIA to private equity used to be a finishing move, a reward at the end of a long and (hopefully) successful run. Today, private equity comes calling earlier and faster than some firms anticipate.
For many founders, the call is getting harder to ignore.
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The numbers tell a clear story. In 2025, RIA mergers and acquisitions hit a record 466 announced deals. That’s a 27% jump over the year before, and 72% of those deals were powered by private equity.
I understand the appeal. The pitch is compelling: High valuations, succession solutions, access to capital and a well-developed infrastructure.
But in my conversations with advisers across the country, I’m hearing something that doesn’t make it into the press releases: Some of the advisers who sold are now asking whether it was worth it.
Private equity has played an important role in professionalizing and scaling many firms in our industry. At its best, it can help bring capital, infrastructure and strategic discipline that can accelerate growth.
Some of the most successful partnerships tend to be with firms that already have a strong organic growth engine and a clear sense of who they are.
There is a key consideration in decision-making here to frame your decision, and most people blur it when they shouldn’t. Selling to private equity vs selling and becoming a W-2 employee are actually two very different economic and identity choices.
Not all liquidity events are the same — some preserve independence and amplify it. Others, over time, replace it with employment.
How ownership structure shapes independence
Private equity firms are structured to generate returns for their investors, typically within a defined time horizon. That model can bring focus, discipline and resources.
At the same time, it’s worth understanding how that structure aligns with a profession built on long-term relationships and client outcomes.
In the PE partnership model, you’re often helping create the next multiple. In a W-2 structure, you’re typically operating inside a multiple that’s already been paid for and needs to be sustained.
Growth is not an outcome — it’s a habit. Whether you are independent or partnered with private equity, firms that grow consistently have one thing in common: A repeatable, disciplined approach to generating new client relationships.
For some advisers, changes to autonomy can be a meaningful consideration. According to research from Cerulli, 52% of RIAs cited loss of autonomy in operations and service as a major concern when affiliating with a PE-backed consolidator.
Around the same number were concerned about a reduction in their overall autonomy.
While firm owners may benefit from these arrangements, employees lower on the organization chart can be left without any stake at all.
Advisers and other team members who were once promised a partnership path to equity ownership have seen wages suppressed, been pressured to take on more clients than they were comfortable with and watched their path to ownership evaporate.
That’s a hard thing to explain to someone who joined your firm because they believed in what you were building. That said, many firms navigate this transition successfully but it requires intentional leadership and clarity around culture, incentives and long-term vision.
The question every RIA owner should ask
In my conversations with RIA founders around the country, I consistently hear some version of this: “We want to grow, but I just don’t see how we can do it without outside capital.”
PE firms promise this capital, along with access to the latest technology and top talent. The question worth asking before signing is whether those resources come with strings that fundamentally change how you serve your clients and run your firm.
The most important question isn’t just valuation it’s: Do you still want to be an owner and operator, or are you ready to transition into a different role?
Advisers at independent firms know who they’re working for and why. That clarity can change when a firm becomes part of something that’s being built toward a future liquidity event.
To be fair, selling to a PE-backed firm can be the right growth strategy for some RIAs. But a key decision is whether you’re transitioning into an employee role or maintaining control as an owner, and it’s critical to understand the difference.
It’s worth acknowledging the structural tension between a model designed for short-term returns and a profession that relies on long-term relationships.
How independent RIAs can grow
None of this means independent firms are stuck. Growth without outside ownership may have challenges, but it’s very doable.
Here are four ways to approach it:
Organic growth is your superpower. Independent firms that define a clear market specialty tend to grow organically through client marketing, events and prospecting at higher rates than those who don’t specialize.
Specificity fuels referrals, deepens expertise and builds a brand that’s hard to replicate. That often means consistently generating a defined number of new client conversations each month and treating that pipeline as a core business discipline, not an afterthought.
Enablement without control. There are models that aim to provide capital and support while preserving independence. For example, AE Wealth Management, where I am the president, offers capital solutions that can assist advisers with future acquisitions, plus business and employee development to help toward future growth. Those are often done in the form of a minority investment.
Leverage the right partner for scale without sacrifice. Your choice of asset management platform plays a significant role in your ability to grow. The right partner should do more than manage investments; it should function as an extension of your firm.
Firms that leverage integrated platform partners such as AE Wealth Management, for example, get access to customized portfolios, alternative investment options, ready-to-implement marketing programs and back-office support, all from one team focused on your success.
Product selection is also a factor, as access to a wider range of products is a key differentiator for independent firms.
Invest in your people before someone else offers to. One of the most common exit triggers is the absence of a clear succession path for the next generation of advisers in a firm. Building internal equity tracks and leadership development programs addresses that problem before PE shows up with an offer that solves it on someone else’s terms.
Use your independence as an asset. Clients notice when their adviser’s firm changes hands. Many don’t understand the implications of PE ownership, but they understand the question, “Who actually owns this firm, and what are their incentives?”
An independent, founder-led firm can answer that question clearly. As consolidation continues, that’s becoming a genuine differentiator.
The case for staying independent
AE Wealth Management was founded by people who believe in the independent adviser model. We think independence is increasingly a signal, not just a structure. It tells clients their adviser’s interests are aligned with theirs, not with a holding company’s exit timeline.
The advisers who will continue to thrive in this environment have built great firms designed to last. As consolidation through outside ownership continues to reshape the landscape, that kind of staying power is becoming a differentiator clients notice and value.
The goal isn’t to avoid partnership — it is to enter it from a position of strength. And regardless of the path you choose, one principle holds: Your most important KPI isn’t AUM — it’s whether you know where next month’s clients are coming from.
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