$1 billion RIA Ascent goes to Dynasty Financial Partners

With RIA reaching new milestones every year, a billion-dollar practice has gone to an old friend who helped get it started when the two companies started a decade ago.

Financial advisers Brad Kowalczyk, Mark Moshier and Scott McCartney of Ascent Wealth Partners, an RIA with three offices in upstate New York and $1.06 billion in assets under management, have returned to the network Dynasty Financial Partners about seven years after leaving Dynasty, the companies said. May 9. Ascent will use outsourced compliance, accounting, marketing and community offered by Dynasty, which is about to go public in an IPO.

IPO imminent for her and consolidator RIA Wealth management activities of CI Financial in the United States this year marks only the latest signals in the increasingly competitive race between wealth managers to serve as many practices as possible and between investors to tap into the industry. A record number of 900 new SEC-registered RIAs opened in 2021, pushing the total up to a new high of 14,800, according to the regulator. In the same way, the number of representatives registered only with RIAs jumped 11% to an all-time high of 77,468 in 2021, FINRA’s annual snapshot shows.

Ascent, which is based in New Hartford, Saratoga and Elmira, has been RIA-only since 2017 and had “parted on very good terms” with Dynasty when company executives made the decision to handle their own administrative and operational duties. , said Kowalczyk. in an interview. Amid the surge in capital and companies willing to work with RIAs in any capacity in recent years, the partners had stayed in touch with Dynasty and made the decision to return to its network.

“It’s a first-world problem. It’s the product of our success,” Kowalczyk said. “We have grown a lot. We started from scratch 10 years ago. We are north of a billion now. The complexity has increased.

The options available for practices like Ascent have reached a level that might not have seemed possible when it and Dynasty launched in 2011. At least 20-25 RIA platforms like Dynasty or consolidators like Savant Wealth Management bills itself as a way to build firms’ capabilities by taking tasks away from them and allowing them to focus on attracting and retaining clients and advisors, according to Savant CEO Brent Brodeski. Savant also sees more growth after to add its second financial partner last year.

Brodeski’s team plans to purchase between four and six new RIAs each year with the goal of expanding its current size three to five times by 2027, he said in an interview. To do this, the Rockford, Illinois-based company is leveraging funding from new minority investor Kelso & Co. and the existing one at Cynosure. Savant has only made a dozen acquisitions to date, but it has surpassed 100 employees and plans to spend more than $10 million on technology as it grows from its current footprint of 20. offices and $14 billion in AUM, according to Brodeski. The industry record deal has expanded beyond the practices of simply finding succession plans, he said.

“You have founders and majority shareholders who might be in their 40s, but they realize they can’t make the kinds of investments that Savant could,” Brodeski said. “If the pie is much bigger, then our customers, our team, our community and our owners, they all get a big slice of the pie.”

Few companies embody the biggest RIA pie in recent years as much as Dynasty, which worked with 295 advisers managing more than $68 billion in assets under administration at the end of 2021 after starting with a network spanning just 3 billions of dollars ten years ago, according to its last S-1 filing with the SEC in April. Dynasty’s net income soared 233% in 2021 to $16 million, with the company targeting independent advisers whose numbers are growing as the number of connection houses and wealth management as a whole declines, the filing says. .

“We maintain an active effort to identify and onboard advisers who are considering separating from their affiliated brokers, as well as RIAs who are considering switching service providers,” the document states. “Our business will depend in part on our ability to continue to attract new advisors and advisory firms to our platform and to increase usage of our platform by financial advisory firms and their client bases.”

Dynasty moved its headquarters to St. Petersburg, Florida, in 2019 from New York, but founder Shirl Penney and Ascent owner Mark Moshier each have residences upstate in Saratoga, Kowalczyk noted. . The paying company had parted ways with another RIA to launch in 2011, and its SEC ADV form now lists a dozen employees. Ascent “entered into a commercial transaction” of an undisclosed size with Dynasty on April 1 according to its Form ADV brochure.

The transaction and “a contractual relationship” with Dynasty gives Ascent access to “preferential pricing on trading technology, reporting, custody, brokerage, compliance and other related services,” according to the brochure. “Dynasty charges a fee, which is paid by the [RIA] annual investment management fees charged to clients.

Kowalczyk predicts that independence — on a stand-alone basis or through support from companies like Dynasty — will continue to attract advisers nationwide as practices move away from traditional brokerages.

“I appreciate that the buck stops with us,” he said. “We are responsible for all decisions that are made that affect our customers, whether it is the suppliers we choose or the advice we provide to our customers.”