Two of the industry’s largest and fastest-growing RIA firms, FormulaFolios and Brookstone Capital Management, have merged in a deal worth more than $6.5 billion in client assets, the two companies announced Wednesday in a news release.
The merger positions the new firm, operating under the Brookstone name, as a leading provider of advisory services to its targeted niche audience of retirement advisors. The FormulaFolios brand name will be retained for continued oversight of the asset management division.
Headquartered in Wheaton, Ill., a suburb of Chicago, Brookstone was founded by Dean Zayed in 2006. Through its turnkey asset management platform (TAMP), the company provides fee-based asset management services to a network of independent advisory representatives (IARs) seeking a wide array of investment strategies.
As of December 31, 2019, Brookstone reportedly managed more than $2.95 billion in client assets.
The company has been on a continued growth trajectory since July 2019, when it partnered with AmeriLife Group, now backed by private equity firm Thomas H. Lee Partners L.P., a move that created one of the largest independent marketing and RIA organizations in the U.S.
Investment advisor Jason Wenk co-founded FormulaFolios in 2012 by building an algorithm that automatically rebalances portfolios and makes trades according to market analysis and a client’s investment goals. The company’s white-label platform includes a client-facing online portal.
FormulaFolios is headquartered in Grand Rapids, Mich. According to its press release, it managed $3.64 billion in assets at the end of 2019.
Under terms of the deal, Zayed will serve as the CEO of the emerging company, and he also serves as president of AmeriLife's Investment Advisory Services division. Wenk joins Brookstone as executive director. Other C-suite executives include Darryl Ronconi as president and COO; Jason Crump as vice president of relationship management; and Joel VanWoerkom as vice president of operations.
Both founders discussed their companies’ merger in the news release, and the benefits it would bring to advisors and their clients.
“This is a unique opportunity for both firms and our affiliated advisors,” Wenk said in the news release. “Both companies have spent significant resources in building out the platform and programs they consider to be their competitive advantages. Now we can leverage each other’s strengths to deliver a more robust experience to our advisor clients.”