RIA M&A Valuations Hit Record Highs in 2024, Yet Not All Are Poised for Future Wins: Report
The RIA M&A market achieved unprecedented milestones in 2024, surpassing previous records for deal volume and hitting a new median valuation of 11x earnings. This growth signals a robust market, but the 2025 RIA Deal Room report from Advisor Growth Strategies (AGS) emphasizes that not all participants will reap equal rewards.
Now in its seventh year and sponsored by BlackRock, this report serves as a critical resource for buyers and sellers aiming to distinguish themselves in an increasingly crowded and complex landscape.
Brandon Kawal, partner at AGS and lead author of the report, warns that hesitation can be costly for sellers. “Sellers taking a leisurely approach can leave a lot on the table,” he notes. “Buyers are hungry in 2025 but sophisticated enough to sort the best from the rest.” He stresses that achieving top valuations hinges on demonstrating real, transferable value—a theme echoed throughout the report’s findings.
The 2025 RIA Deal Room report highlights four pivotal trends shaping the market:
Large Firms Are Most Desired, but Target Market Expands
While large RIAs remain the most sought-after targets, competition has intensified for firms managing less than $1 billion in assets. A saturated buyer pool has driven this shift, expanding opportunities for smaller players even as the biggest firms command premium attention.
Deal Structures Mandate Growth
Earnouts and performance-based terms dominate deal structures, requiring sellers to prove sustained growth post-transaction. Success in these arrangements depends on partnering with buyers who have strong execution capabilities, ensuring that the promised value is realized, and valuations are maximized.
Integration Is the Prevailing Path
The most active acquirers are now “single brand” integrators, prioritizing cohesive, long-term value creation over owning a patchwork of brands. This trend reflects a strategic shift toward integration as the preferred path for building enduring market presence.
Race to Build the Next Platform
More capital is flowing into RIAs aiming to scale, fueling a race to build the next major platform. However, sustainability remains elusive, and firms seeking investment must weigh the trade-offs carefully. The report cautions that minority investments may not equate to minority control, urging clarity of purpose in deal negotiations.
John Furey, managing partner at AGS, contextualizes the market’s evolution: “Last year, we highlighted the resilience and permanence of RIA M&A. With market concentration putting downward pressure on the industry, many firms face organic growth challenges and must decide to build independently or partner.” He underscores that while opportunities abound, the market’s growing sophistication elevates the stakes, demanding sharper strategies from all players.