Executive Summary
RIA M&A remains on a historically strong trajectory, but the valuation environment is becoming increasingly selective.
DeVoe & Company tracked 167 RIA transactions during the first six months of 2026, up 13% from 148 during the same period in 2025. Second-quarter transactions declined to 74 from 93 in the first quarter, however, as market volatility temporarily slowed activity.
The bigger story for advisory firm owners may be what is happening beneath those transaction numbers.
Buyers increasingly appear unwilling to assume that every growing RIA deserves a higher multiple simply because the broader acquisition market remains active.
Instead, recent valuation research continues pointing toward a more segmented market in which sustainable organic growth, profitability, leadership depth, operational infrastructure, client retention, and transferability determine which firms receive premium consideration.
That creates an important distinction for advisory firm owners:
A firm can be highly profitable for its founder without necessarily being highly transferable to its next owner.
The businesses capable of closing that gap may ultimately capture the greatest enterprise-value premium.
Practice Valuation Scoreboard
| Trend | Current Direction | BKLM View |
|---|---|---|
| Transaction Activity | ▲ Strong | First-half dealmaking remained at record levels |
| Overall Valuations | ► Stable | Broad multiple expansion appears to be leveling |
| Premium Valuations | ▲ Selective | Exceptional firms can still command significant interest |
| Organic Growth Importance | ▲ Increasing | Becoming a defining valuation differentiator |
| Founder Dependency | ▼ Negative | Concentrated relationships create transferability risk |
| Succession Planning | ▲ Increasing | Leadership depth increasingly affects enterprise value |
What Buyers Are Paying For
1. AUM Is No Longer Enough
For years, advisory-firm growth was often discussed primarily in terms of AUM.
That measurement remains important.
But it doesn’t tell the entire story.
A firm’s AUM can increase because:
• Financial markets appreciate
• Existing clients contribute additional assets
• New clients join the firm
• Advisors bring assets with them
• The firm completes an acquisition
Those sources of growth are not economically identical.
Recent research from Mercer Capital emphasizes the distinction between AUM growth and true organic growth. Market appreciation can increase assets, revenue, and profitability, but it does not demonstrate that the business itself can repeatedly attract new clients and assets.
That distinction matters to a buyer.
A firm that consistently generates net new assets through referrals, marketing, centers of influence, advisor business development, and existing-client relationships possesses something potentially more durable:
a growth engine.
BKLM Take
AUM tells a buyer what you’ve built.
Organic growth helps tell a buyer what the business might build next.
Increasingly, both matter.
2. The Growth Engine Must Survive the Founder
Even strong organic growth has limitations if it depends entirely upon one person.
Consider an advisory founder who personally generates nearly every major new relationship.
That individual may have built an extraordinary practice.
But a buyer still has to ask:
What happens when that person leaves?
Mercer Capital notes that buyers can discount growth that depends heavily on a founder, single rainmaker, or concentrated referral source. Growth becomes more valuable when it is diversified, measurable, documented, and supported by multiple members of the organization.
That means sophisticated buyers may increasingly examine:
• Who originates new relationships
• Where referrals originate
• Whether multiple advisors can win business
• How prospects are tracked
• Whether business development is documented
• Whether client relationships are shared
• Whether next-generation leadership exists
• Whether the firm’s brand extends beyond its founder
BKLM Take
The goal isn’t simply to create growth.
The goal is to create transferable growth.
A business-development system that continues functioning after the founder leaves may be considerably more valuable than an impressive historical growth rate that leaves with the founder.
3. Headline Multiples Don’t Tell the Whole Story
Advisors frequently hear stories about firms selling for extraordinary EBITDA multiples.
Some of those numbers are real.
But they don’t necessarily answer the question:
“What is my firm worth?”
Succession Resource Group’s 2026 Advisor M&A Review examined 171 peer-to-peer transactions completed during 2025, representing roughly $14 billion in transferred AUM.
The median EBITDA multiple was 11.65x.
The average was 9.98x.
But the range extended from 5.90x to 13.75x.
Importantly, those figures exclude private-equity and aggregator transactions, which can involve different economics, strategic considerations, synergies, and deal structures.
That spread illustrates why there is no universal “RIA multiple.”
Two firms with similar revenue or AUM can receive very different valuations because their underlying businesses are different.
BKLM Take
When someone says, “RIAs are selling for 12x,” the next question should be:
Which RIAs?
Growth, profitability, client composition, succession depth, concentration, transaction structure, and buyer type all matter.
4. The Market Is Separating Practices From Enterprises
The current valuation environment increasingly rewards institutional characteristics.
Mercer Capital describes an increasingly segmented RIA M&A market in which premium valuations favor firms demonstrating organic growth, scalable infrastructure, institutional leadership, and differentiated services rather than simply large asset bases.
This may represent one of the most consequential shifts occurring in advisory-firm valuation.
A successful practice might have:
• Excellent clients
• Significant revenue
• Strong margins
• A highly productive founder
But an institutional enterprise adds another layer:
• Leadership beyond the founder
• Standardized operations
• Shared client relationships
• Repeatable business development
• Scalable technology
• Documented processes
• Management infrastructure
• A recognizable firm-level brand
• A credible succession plan
Both can be excellent businesses.
But from an acquisition perspective, the second may present less transition risk.
And lower risk can support a higher valuation.
5. Succession Planning Is Becoming Valuation Planning
Succession is often treated as something advisors address shortly before retirement.
That may be too late.
Leadership development, client transferability, equity participation, compensation structure, management responsibilities, and next-generation advisor development can take years to establish.
September industry reporting continues to highlight succession as both a financial and organizational challenge for advisory founders.
The implication for enterprise value is significant.
A buyer acquiring a firm with established next-generation leadership may be purchasing continuity.
A buyer acquiring a firm completely dependent upon a retiring founder may be purchasing transition risk.
Those aren’t the same assets.
BKLM Take
The best time to build succession value may be long before you’re thinking about selling.
A credible next generation doesn’t simply solve a retirement problem.
It can become an enterprise-value asset.
BKLM Enterprise Value Insight
One of the most important questions an advisory owner can ask today may be:
“What parts of my firm’s value would remain if I stopped working tomorrow?”
Consider the firm’s:
• Client relationships
• Referral sources
• Business-development pipeline
• Brand
• Investment process
• Planning expertise
• Technology
• Employees
• Management
• Operating procedures
• Recurring revenue
• Centers of influence
• Institutional knowledge
The more of those assets that exist independently of the founder, the more transferable the business becomes.
This doesn’t diminish the importance of entrepreneurial founders.
Quite the opposite.
The final stage of entrepreneurship may be turning everything the founder personally created into something the organization can perpetuate.
That is how a great practice becomes an institution.
What We’re Watching
For the remainder of 2026, BKLM will continue monitoring:
• RIA transaction volume
• Changes in EBITDA and revenue multiples
• Organic-growth valuation premiums
• Private equity activity
• Minority investments and recapitalizations
• Earnout structures
• Rollover-equity requirements
• Buyer appetite by firm size
• Succession-related transactions
• Next-generation ownership models
• Founder-dependency discounts
• Differences between strategic and financial buyers
• Valuation dispersion between average and premium firms
One question will be especially important:
If industry-wide multiples stop rising, how much more will buyers pay for exceptional businesses?
BKLM Bottom Line
The RIA acquisition market remains strong.
But strong acquisition demand should not be confused with automatic premium valuations.
As buyers become more disciplined, firm-specific business quality increasingly matters.
AUM remains important—but so do organic growth, profitability, leadership depth, recurring revenue, scalable operations, client retention, and transferable relationships.
For advisory firm owners thinking five or ten years ahead, that creates an opportunity.
Don’t wait until the year before a transaction to ask what your practice is worth.
Spend those years building the characteristics that can make it worth more.
The next great valuation story may not be about who built the biggest practice.
It may be about who built the strongest business.