Focus Financial Partners LLC, which in less than a year has expanded
into one of the ten largest independent wealth management firms in
the nation, has just gotten bigger.
The New York
City-based firm announced that it has acquired the wealth management
firms of HoyleCohen Inc. of San Diego and Resnick Investment Advisors
LLC of Westport, Conn.
The addition of
the two firms brings Focus Financial Partners' assets under management
to $4.5 billion just six months after the company was founded by CEO
Rudy Adolf.
Adolf has set out
to give the new firm a swift national presence through a series of
acquisitions. Backing him in the plan has been Summit Partners, a
private equity and venture capital firm that provided Focus Financial
with $35 million in financing at its founding.
Summit Partners, which has $9 billion under management, is the firm's lead investor.
"We're not number
one yet but we're getting there," Adolf said in a recent interview.
"Our aspiration is crystal clear: Within a very short time frame we
will be the leading independent fiduciary wealth management firm in the
country."
HoyleCohen was
founded in 2002 through the merger of wealth management firms owned by
Kevin Hoyle and Joseph Cohen. "We joined Focus for its unique model
that maximizes the benefits of autonomy while benefiting from the
resources, scale and best practices of a large national firm," Hoyle
said.
Martin Resnick,
partner and managing director of Resnick Investment Advisors, said,
"Through Focus we will be gaining access to the ideas and expertise of
a network of highly respected wealth management firms across the
country, which we believe will benefit our clients."
In previous
interviews, Adolf has said that each partner, or member firm, becomes a
subsidiary of Focus Financial Partners, sharing a portion of Focus
Financial's profits while retaining control over its own client
services and local business operations. Focus typically acquires 40% to
60% of a selling firm's ongoing economic interest in exchange for cash
and an ownership position.
Among the criteria
Focus Financial uses in selecting acquisitions is that potential
partners must act as fiduciaries, putting their clients' interests first,
use a systematic and professional process for advice and planning, and
provide services under a fee-based structure.
The company's current plan is to target 30 to 50 acquisitions over the next three to five years.
"There is a group
of firms that has reached a level of scale, of professionalism in terms
of client impact where, ultimately, our model can be very helpful in
enabling these firms to reach their goals," said Adolf, a former
partner at McKinsey and Company in New York and most recently senior
vice president and general manager of the American Express Global
Brokerage Banking Division.