The pandemic has pushed advisors who were thinking of buying or selling a firm to get off the fence, and mergers and acquisitions—which already were growing in number—will jump dramatically in the future, according to a panel of advisory industry leaders.

“The coronavirus negatively affected the financial industry briefly, but we have had a rapid recovery,” said Peter Mallouk, president of Creative Planning, an independent wealth management firm and RIA based in Overland Park, Kan.

“It made advisors realize that if they were considering exiting the business in the next few years, they need to think about doing it now," he said. "From the other side, buyers are back, and we will see more activity in the next few months.”

He added that he wants "total integration" from firms looking to join Creative Planning. "For firms that do not want that, there are a lot of other options out there,” he said.

Mallouk was part of a panel discussion on Wednesday sponsored by JConnelly, a public relations and consulting firm.

“The pandemic was a real wake up call,” agreed Ron Carson, founder and CEO of the Carson Group, a family of financial firms based in Omaha, Neb. “It will make M&A accelerate. I am surprised we have not seen more already.”

Firms that want to join the Carson Group need to have the same culture, he added. “Anything else we need to match can be done later” if the cultures mesh.

The Carson Group has 15 deals in play right now, which is an increase over 2019, Carson noted.

Bob Oros, CEO of Hightower Advisors based in Chicago, said advisors recently have been questioning whether they want to continue to go it alone or want a partner of some sort. "Going it alone is hard during painful times like last spring,” he said.

Oros noted that when Hightower evaluates firms that want to join the Hightower platform it makes sure they have thought about their succession plans. And he added that Hightower looks for firms that work as a team and share the wealth with all members.

“Advisors are deeply evaluating their next moves,” said Luke Winskowski, head of the Thrivent Advisor Network, a division of Thrivent, a not-for-profit financial services firm based in Minneapolis. “They are looking for a firm that is stable.”

He stated that Thrivent strives to join with firms that want a real partner and aren't just looking to buy more services.

Advisors who are contemplating making a move want more strength, but many do not necessarily want to move to a firm that is too large, said Jim Dickson, CEO of Sanctuary Wealth, a financial services firm in Indianapolis. “They want to retain control and remain flexible.”

The fact that some foreign buyers are entering the marketplace and that private equity is available for many deals means there is more money available in the system, Dickson said, adding that the industry will see more differentiation among acquiring firms as M&A activity increases in the future.

Carson noted that the industry executives who participated on the panel almost never face off against each other in takeover attempts because they are all different. He predicted the industry will see a few massive players and some deep-niche firms emerge in the next 20 years or less.

“We are ripe for an unforeseen event that will force more mergers,” he said. “The largest firms are now growing the fastest because there is value in what they offer.”