Dynasty Financial Partners, the St. Petersburg, Fla., platform services company formed in 2010 to service a network of registered investment advisors, yesterday filed an initial public offering with the Securities and Exchange Commission. In the S-1 filing, Dynasty indicates it is looking to sell Class A shares, which it plans to list on the Nasdaq market.
It is seeking to raise a proposed aggregate offering amount of $100 million to buy unitholders out of a predecessor LLC entity that was financed by several private equity concerns. The firm has two other share classes, Class B and Class C.
Dynasty was forged in the wake of the financial crisis by Shirl Penney, a veteran of Citigroup and Salomon Smith Barney, who envisioned a support platform that would help registered investment advisors trying to go independent. The firm offers legal and compliance help; technology services; a turnkey asset management platform; capital help in the form of loans and equity for business expansions; marketing services; business formation assistance; and even help to advisors looking for real estate and office setup.
The firm targets independent wealth managers and advisory teams contemplating a move away from wirehouses and broker-dealers, and serves primarily those advisors catering to the wealthy and ultra-wealthy.
Dynasty had $68 billion in assets under administration as of September 30, according to its S-1 filing with the SEC. “As of September 30, 2021, we partner with 46 financial advisory firms (“Network Partner Firms”) representing 292 financial advisors with an average assets under administration per advisor of $221 million,” the filing said.
“The size of the hybrid and independent channels continues to increase,” said Dynasty in its IPO filing, “with AUM growing 12.2% and 10.4%, respectively, over the five-year period ended December 31, 2019, according to Cerulli data. We maintain an active effort to identify and onboard advisors who are contemplating separating from their broker-dealer affiliates, as well as RIAs who are considering changing service providers.”
The firm generated $49.2 million in total revenue for the nine months ended September 30, up from $32.7 million for the same period the year before. The company’s tech solutions and business services provided more than $25 million of that revenue for the first nine months of last year. In the year 2020, the firm generated $46.2 million in total revenues, up from $40.5 million in 2019.
The 44-year-old Penney will be the firm’s president, CEO and director (and he’ll also sit on the board of directors). Though the S-1 filing did not divulge his ownership stake, it did list his total compensation with salary and bonuses of $711,975.
The RIA aggregation platform concern has three classes of stock. Class A and Class C shareholders have one vote per share. Class B shareholders have 5 votes per share.
Edward Swenson is listed as the firm's COO. Justin Weinkle will be the company’s chief financial officer. Sam Levinson, a managing partners at GF Investments is listed as a major shareholder and director.