Once Exhibit A that roll-ups are a flop, NFP is emerging as a stingy, strategic player
Under outgoing CEO Jessica Bibliowicz, the bruised but fast-growing New York aggregator no longer resembles its insurance-dependent 2008 self
Elmer Rich III
We are doing more and more M&A work representing buyers and sellers. The roll-up model, driven, it appears by cheap buy-out fund availability, never had an opportunity to mature. Everyone was looking for a quick buck and we know how schemes go.
So that model is discredited which, along with this story, suggests a contrarian opportunity using a 2.0 version of roll-ups.
Stingy and strategic are usually opposites.
We define strategic as ROI horizon of 10+ years. We have one strategic buyer looking for multi-generational returns! That’s long. Strategic buyers want to own a piece of a demographically growing business.
A strategic buyer will usually pay more since their payout horizon is longer. A tactical buyer needs a 3-5 year payout.
Since all financial services and retirement businesses are really entering the first generation of ownership transitions and liquidity events — there will be a lot of trial and error.
Often it is easier to focus on what doesn’t work than the progress that is being made in helping RIAs and TPAs and firm owners secure retirement and estate funding from their life’s work.