The wealth management industry has never been more attractive to investors. Record valuations, rising merger and acquisition (M&A) activity, and a flood of capital from private equity and strategic buyers have created an opportunity for advisory firm owners. Many leaders who have spent years building sustainable, client-centric businesses are now facing the billion-dollar question: Should I double down and scale or capitalize on my firm’s enterprise value and sell?
It’s not just a financial decision. It’s a defining moment in the legacy of a business.
As an organization deeply involved in helping advisory firms navigate growth, succession, and liquidity strategies, MarshBerry frequently works with founders and executives who are grappling with this exact dilemma. The decision is rarely black and white and shouldn’t be driven by market momentum alone. Instead, it requires a deep understanding of ownership’s long-term vision, appetite for growth, and the shifting dynamics of the wealth management industry. What follows is a roadmap for thinking through this complex decision strategically.
Valuations are tempting — but what comes next?
We’re in an era of strong valuations. Many advisory firms, particularly those with $1B+ in assets under management (AUM), are seeing enterprise values between 10x–20x+ EBITDA (earnings before interest, taxes, depreciation and amortization), depending on their growth trajectory, revenue profile, talent mix and other value drivers. The influx of institutional capital has reshaped deal structures, offering everything from all-cash exits to minority recapitalizations that allow founders to take chips off the table while staying in control.
But valuations alone shouldn’t drive your decision. The real question is: What’s the best use of your time, capital, and energy over the next decade? Let’s consider this key question from two perspectives.
Conviction, capital, and culture-building (The case for growth)
If you believe in the long-term value of your firm and have the appetite for further expansion, now could be the time to lean in rather than exit. Here’s why:
- The market remains ripe for growth. Client demographics, wealth transfers, and the demand for holistic planning are fueling the need for sophisticated advisory firms. If you’ve built a scalable model, there’s significant opportunity to scale it ahead.
- Differentiated firms can stand out. Many private equity-backed aggregators are realizing that integrating multiple firms together takes time and energy. That presents opportunities for independently minded firms to stand out with a differentiated, client-first model.
- Minority transactions can offer liquidity. Instead of a full exit, consider selling a minority stake to a strategic or capital partner. This de-risks your personal financial position while maintaining leadership over your firm’s future.
- Internal succession still holds merit. If your vision is to create an enduring enterprise, a well-structured internal succession plan can provide long-term stability without handing over the keys to an outside buyer.
That said, growth requires conviction, capital, and culture-building at scale. If you’re not willing to reinvest in your team, technology, and client experience, it may be time to consider the alternative.
Being proactive beats being reactive (The case for cashing in)
Selling is often the smartest way to protect the value you’ve worked so hard to build. Here’s when cashing in might make sense:
- You desire centralized infrastructure. Running a billion-dollar firm is no small task. If managing infrastructure, technology, and processes is eating into the time you’d rather spend with clients, selling could allow you to refocus on what you love most.
- You’ve built an institutional-ready firm. If you have strong financials, a scalable operating model, and a leadership team that can carry the firm forward, buyers will pay a premium for that level of maturity.
- You want to deliver more value to clients. Selling isn’t just about the valuation, it’s about unlocking new possibilities. The right partner might give you the resources and bandwidth to enhance your services, adopt cutting-edge technology, or expand offerings that provide even greater value to your clients.
- You recognize the opportunity to build on your success. Growing a business comes with evolving challenges: scaling operations, retaining top talent, and meeting shifting client expectations. Selling may allow you to both achieve strong valuations and better navigate your business’ future.
The key is ensuring you are proactively evaluating options before external pressures (like a market downturn or internal leadership gaps) force your hand.
How to navigate the decision: Five key questions to ask
Before deciding whether to grow or sell, take a step back and ask yourself these crucial questions:
- What’s my personal and professional horizon? Do I see myself leading this firm for another 5, 10, or 15 years? If not, what’s my ideal role in the future?
- What’s my appetite to grow? Am I comfortable reinvesting in the business, or would I rather lock in my gains now?
- What would a great outcome look like? Beyond the financials, what legacy do I want to leave behind?
- Am I prepared for the complexity of scaling? Do I have the right team, capital, and infrastructure to grow beyond where we are today?
- What are my deal structure options? If I were to sell, would I prefer a full exit, a minority transaction, or a partnership that allows me to stay engaged?
The power of intentionality
The best advisory firm leaders don’t react to market trends, they architect their future with intention. Whether you choose to grow or cash in, the key is making a proactive, strategic decision that aligns with your long-term vision.
For those leaning toward growth, the path forward requires investment, leadership development, and a commitment to scaling intelligently. For those considering a sale, maximizing value requires the right deal structure, the right buyer, and a clear post-sale plan.
Either way, don’t let the current M&A market dictate your decision. The best time to evaluate your options is before the market forces your hand. The right strategy isn’t just about today’s valuation, it’s about building a future that aligns with what matters most to you.
