Finding value rather than scale is the key to M&A, according to Fitzpatricks Private Wealth chief executive Jodie Blackledge, with the mid-sized advice group focussing on “complex clients” that get the most value from its ‘Lead Adviser’ system.
The most recent firm to join is Brisbane-based Rothgard Financial Partners, which connected with Fitzpatricks via strategic partnership last week.
Blackledge tells Professional Planner that higher complexity is often aligned to higher wealth but not always. “We are value focused, not scale focused”, she says.
Like similar programs offered by AZ NGA and CountPlus’, FPW’s offers an alternative to M&A that allows firms a union where they can maintain a strategic or equity partnership.
“We also offer Lead Adviser because it fulfils an underlying purpose – to help elevate advice to a profession – and advice done well is good for the community,” Blackledge says.
Supply for industry M&A has been limited, with the expectation that professionalism reforms and regulatory costs would make running an advice business unaffordable.
Finding cultural fits, whether it being from one of the major service providers or likeminded groups, has been key for many advice businesses.
In a column for Professional Planner, AZ NGA chief executive Barrett said the industry is likely to give rise to the “super firm” akin to the mid-tier in accounting and professional services.
“Inside the AZ NGA network, a number of firms are looking for opportunities to scale up by partnering with complementary business to form large, multidisciplinary firms,” Barrett said.
Blackledge says succession and growth support are often key considerations for firms choosing an advice partner.
“Where businesses choose to align to the full Fitzpatricks Private Wealth model, we are well positioned and have a track record of providing growth and succession support.”
Offering flexibility around how firms join, Blackledge says, supports businesses by allowing them to become a principal-led boutique lead adviser firm or a multi-planner practice.
“In any long-term business relationship trust and alignment are central, and we know this takes time.”
When it comes to equity partnering, Blackledge says Fitzpatricks is flexible with how much ownership it takes in practices.
“We believe firmly that advice practices flourish when there is equity held by key principals and talent, and therefore we’re not seeking to acquire one hundred percent of a practices, other than as a short-term measure to facilitate succession or a merger into an existing practice.”