“We had conversations with 14 industry firms, each with name recognition, but none of them were a fit with the self-assessment/gap analysis we went through,” Webster said in the email. “Alera was different. It gave us the opportunity to continue offering our clients a similar experience, while providing for our succession and contingency planning needs, which were our primary goals.”
Based on his firm’s due diligence, Webster said he did not believe that bigger was necessarily better when it comes to partnering with another RIA business.
“You give up a lot in joining a much larger firm,” he said. “Your process, fee structure, and portfolio construction are called into questions and are likely to change. Alera gives us the ability to access the resources of a larger firm, while giving us the opportunity to help Alera shape what its wealth services offering ultimately looks like. We are encouraged by the possibilities, and while we like the idea of scale, this partnership still retains the core of what we do that differentiates us from the rest of the industry.”
Webster said that initially, his firm’s clients would not notice a change post-merger since most of the initial benefits of the acquisition will be back-office services, such as IT, compliance, legal, financial, marketing, human resouces, payroll and website management. However, clients will eventually benefit from the services he and his team help Alera to develop over time.
“For example, one-third of our individual clients are next generation descendants from our first generation client base,” he said in the email. “We believe we will need to develop services and platforms that appeal to clients age 25 to 40 years old to retain their business as they inherit the wealth we’ve helped their parents and grandparents build. Also, private equity and alternatives will become a bigger part of portfolio construction in their future. We look forward to working with Alera and the other RIAs it acquires to build a world-class private equity and alternatives platform in the future.”
Alera Group has more than 3,500 professionals in more than 130 offices nationwide, with more than $980 million in annual revenue.