In the fast-evolving landscape of mergers and acquisitions (M&A) for registered investment advisors (RIAs), staying abreast of trends and technological shifts is crucial. In a recent webinar sponsored by DeVoe & Company, Mirador, and ShellBlack, experts delved into the intricacies of M&A transactions from the technology side. Brad Grubb, Managing Director at DeVoe & Company, led the discussion alongside Mike Gault, Chief Solutions Officer for Mirador, and Shell Black, founder and president of ShellBlack.
Setting the Stage
Brad kicked off the webinar with an overview of the RIA M&A landscape, offering a historical perspective on the industry’s growth. With explosive expansion over the last nine years, including a surge in transactions from 2020 to 2023, the M&A sector has witnessed notable changes.
Looking ahead into the remainder of 2023 and beyond, Brad emphasized the consistent trajectory despite a challenging market. Notably, the total value of transactions dipped due to a drop in revenues, yet valuations remained strong. He also mentioned anticipation for a potential correction — and with 185 completed transactions for the year as of the webinar date, the industry is closely watching for further developments.
The Tech Challenge
Brad introduced the elephant in the room — the 185 tech stacks that need attention, with a possibility of 70 more. In a landscape where technology plays a pivotal role, addressing these tech challenges becomes paramount. Enter the experts, Mike and Shell, whose insights can help to decipher the complexities of evolving technology within the RIA M&A space.
As Chief Solutions Officer for Mirador, Mike brought a unique perspective to the webinar. He emphasized the growing importance of technology in wealth management firms, underscoring its role in enhancing operational efficiency and client satisfaction.
Mike then delved into the current tech landscape, shedding light on how Mirador supports wealth management firms as an outsourced technology partner focused on portfolio management systems. The challenges of addressing disparate tech stacks are real, and he provided a glimpse into how the industry can approach this monumental task — all while stressing the importance of planning, regardless of the specific nature of the transaction. Mike also highlighted Mirador’s focus on data and financial entities, aligning with ShellBlack’s expertise in CRM technology.
As the founder and president of ShellBlack, Shell shared his perspective on the technology puzzle from the CRM side. He highlighted the importance of asking fundamental questions to define the project scope. The type of M&A transaction — whether it’s a tuck-in, a full-fledged office acquisition, or a merger of equals — significantly impacts the complexity of data and CRM requirements.
Shell emphasized the importance of understanding the buyer’s needs, including data migration, translation of business processes, and end-user training. Addressing how much data to bring across is another critical factor, considering the myriad records within a CRM beyond core data like households and clients.
As the webinar presenters dissected the complexities of M&A transactions in the RIA industry, one thing became clear — a strategic approach, guided by experts like ShellBlack and Mirador, can turn this potentially overwhelming process into a manageable and successful endeavor.
To learn more, watch the webinar here > Solving the RIA M&A Technology Puzzle