“The hybrid RIA model is well positioned to absorb advisors who are either unprepared or unwilling to assume the responsibilities of managing a business in addition to working with clients,” Cerulli said in its report.
Furthermore, continued consolidation will breed national hybrid RIAs.
“A patchwork of small businesses is gradually being offset by larger, multi-office enterprises,” the Cerulli report said. “Given their scale, not only are these billion-dollar firms able to acquire the smaller practices of retiring advisors or struggling mid-sized firms, but in some cases, they are also merging with each other.”