SRG Announces the Sale of Washington-based RIA

SRG’s 36th transaction year-to-date

PORTLAND, Ore.--(BUSINESS WIRE)--Succession Resource Group (SRG) announced the sale of Washington-based Registered Investment Advisor (RIA), Evergreen Wealth Management Services, Inc. (EWMS) to a larger San Francisco, California RIA with more than $500 million in assets under management (AUM), led by a CFA and CPA. The sale represents more than $60 million in AUM, putting the acquiring firm over $600 million in AUM.

In aggregate, this represents the 36th transaction SRG has facilitated year-to-date with more than $6.7 billion in AUM, a 20.00% increase in deal volume over the same period in 2023. These findings are consistent with data recently released by DeVoe & Company; transactions involving under $1B are increasing in volume faster than the larger “enterprise-level” firm sales.

EWMS was a fee-only RIA located in Northern Washington. The practice was efficiently run, with 72 households and effectively no built-in overhead a buyer would need to retain. After four decades of operating, EWMS contracted SRG to lead the search for a successor and handle the negotiations for the eventual sale of the practice.

Leveraging SRG’s sell-side team, the transaction was completed in less than ten months, closing in March of 2024 after a rigorous nationwide search and negotiation process designed to ensure the ultimate successor firm was an optimal fit. The practice was listed with an aggressive initial asking price of 2.9x revenue, 9.7x earnings, or 8.8x EBITDA and a strict definition of the ideal buyer for EWMS’ clients. Within two months after accepting an offer and closing the transaction, EWMS happily reported more than 90% client transition, even with the unique circumstances requiring positive client consent.

Key Highlights:

• SRG sourced more than 75 qualified candidates, then narrowed the pool to nine (9) matches using its proprietary matching algorithm that met the seller’s core criteria: fee-only, willing to maintain accounts at Schwab, an active money manager, at least ten years of experience, and a larger firm.
• Of the nine (9) finalists, three (3) buyers were asked to make offers; each making offers at or above asking.
• EWMS ultimately accepted an offer from the firm that had the best fit, resulting in 70% cash being paid following positive consent and the balance within 12 months. The buyer required no ongoing commitment from the seller beyond supporting the introduction of clients – though bonuses were agreed to for exceeding growth targets.
• The sale resulted in a multiple of 9.7x earnings, 11% higher than the listing price, and higher than expected for a firm of this size where the entire price was paid in the first 12 months.

Kristen Grau, CPA, CVA, CEPA, and Director of Sell-Side Services, stated, “EWMS was committed to selecting a firm that knew the markets and would actively manage client money while providing their clients with the same high-touch, customized solutions – which was surprisingly challenging to find since few buyers actively manage client assets. By leveraging our team and process, and maintaining a selfless focus on client fit, EWMS and the buyer were able to create a win for all parties involved, as evidenced by the successful retention of clients post-sale.”

About Succession Resource Group
Succession Resource Group (SRG) is an award-winning consulting firm dedicated to supporting independent financial professionals across the country. We leverage decades of experience to provide a comprehensive suite of services, including valuation, M&A, succession planning, and practice management solutions. Our mission is to empower financial professionals at every stage of their business journey, helping them navigate complexities, maximize value, and achieve their long-term goals. For more information, visit SuccessionResource.com.