Registered Investment Advisory (RIA) consolidators are significantly transforming the traditionally fragmented RIA market, according to a recent report from Cerulli Associates, a Boston-based consulting firm. AdvisorHub reports that the consolidators, often referred to as "roll-up firms" have seen a 31 percent year-over-year increase in assets under management (AUM), now controlling $1.5 trillion—about 18 percent of the RIA market's total AUM. This figure places them in direct competition with established firms like Raymond James Financial's Private Client Group, which reported $1.57 trillion in AUM by the end of the third quarter.
Over the past decade, RIA consolidators have captured an additional 10 percent of the industry's assets, with about 14 percent of advisors now affiliated with these firms—a notable increase of six percentage points over the last five years. According to AdvisorHub, this growth has been driven by the ability of consolidators to develop platforms tailored to advisors' needs while aligning with the objectives of a larger, integrated business.
The report highlights several prominent players in the RIA consolidation space, including Creative Planning, Hightower Advisors, Focus Financial Partners, Mercer Advisors, and Dynasty Financial Partners. Those firms have attracted advisors by offering comprehensive technology solutions that are both integrated and cost-effective, addressing a critical need in the advisory business. Over half of the surveyed advisors pointed to accessible technology as a key factor in their decision to partner with a larger firm.
Succession planning is another major driver behind the consolidation trend. The Cerulli report emphasizes the growing importance of succession strategies as the RIA sector matures. With 37 percent of RIA advisors, or roughly 31,000 individuals, expected to retire within the next decade, an estimated $3 trillion in assets—35 percent of the channel's total AUM—could change hands. Unlike larger wealth management firms, RIAs often lack formal succession programs, leading many advisors to consider a transition to a consolidator as a viable exit strategy. Nearly three-quarters of those surveyed cited succession planning as a crucial factor in their decision-making process.
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