Mariner Wealth Advisors, the Overland Park, Kan., behemoth RIA firm run by Marty Bicknell and boasting $43 billion in assets, has made a deal to buy AdvicePeriod, a $5.1 billion AUM firm founded in 2014 by industry veteran and serial entrepreneur Steve Lockshin.
Lockshin is a celebrity advisor and entrepreneur who was named by Barron’s as the top independent financial advisor in the country in 2011. In 1994, he founded the firm that would become Convergent Wealth Advisors and ran it for almost two decades until 2014. He's since then been known for his career seeding and founding fintech firms. He was an early investor in such companies as Betterment (the robo-advisor), Advizr (the financial planning application), FA Match (an advisor recruiting platform), Quovo (an account aggregator later bought by Plaid) and Wealthbox (a client relationship management software firm). He’s also launched an automated estate planning platform called Vanilla (originally designed to be used at his RIA firm). He founded the AdvicePeriod in 2014 after his project Advizent, a planned cooperative of well-known RIAs, fell apart. Bicknell was also an early co-investor on many of the fintech start-ups.
AdvicePeriod, based in Los Angeles, has spent the last few years acquiring advisor teams for its roster, and reportedly gave them branding, compliance, marketing and tech support. The firm focuses on technology and providing family office services and tax planning for high-net-worth individuals. Lockshin’s refrain is that investment advice is now a cheap commodity, and that advisors only help by giving holistic advice—even on money and assets that aren’t under their purview. He’s also put his money where his mouth is by continually investing in new technological innovations like account aggregation that he says are going to upend the industry.
Mariner, founded in 2006, has been a voracious consolidator of wealth management firms for almost 10 years; the firm started in Overland Park, but spread across the country to offices in New York City, Chicago, Miami, San Francisco, Oklahoma City and St. Louis. The firm announced its 25th acquisition this month (Allegiant Private Advisors, a $1 billion firm in Sarasota, Fla.). Bicknell, the scion to a pizza fortune, spent most of the last decade buying firms out of his own pocket and from company cash flow (as well as playing angel investor to fintech firms), but this year, for the first time, Mariner announced that it had taken on a minority stake from a private equity firm, Leonard Green & Partners in Los Angeles, to help with its further expansion.
There are many reasons that large M&A deals like this rule, and one of them is the huge margins these large RIAs provide to private equity firms.
Mariner and AdvicePeriod said that the way advisors work for them was also a consideration in their match.
“In addition to a more robust reach of capabilities, the acquisition of AdvicePeriod brings more choices to independent advisors looking to partner with a wealth advisory firm to help manage their business,” the companies said in their joint announcement. “Under Mariner Wealth Advisors’ Mariner Platform Solutions, advisors can assume a 1099 employment status with the firm, maintaining their own brand and business while getting support on the back end from a dependable partner. Additionally, AdvicePeriod for Advisors complements this feature, bringing advisors on as W-2 employees under the AdvicePeriod brand while giving them the mobility to synthetically own and run their business under a trusted industry name. With this addition, Mariner Wealth Advisors now has two solutions for advisors who want to own and control their business.”
Larry Roth, an M&A consultant for registered investment advisory firms and managing partner at RLR Strategic Partners, says that he knows Lockshin and Bicknell only by reputation, but says that these kinds of deals are likely driven by the need for RIAs to be able to spread more sophisticated services to clients leaving the wirehouses, specifically to ultra-high-net-worth clients that Advice Period serves.
“What Steve’s built is really catering to what a lot of other firms are trying to sort out: How do you help advisors run a business? How do you help them serve certain types of clients like high-net-worth individuals with sophisticated portfolios? … Marty’s firm is so large and successful that this would be a way to broaden their offering in a meaningful way.”