The financial advisory landscape recently witnessed an innovative shift with the inception of United Wealth Partners (UWP), a groundbreaking registered investment advisor (RIA) aggregator. Spearheaded by two seasoned industry figures, Jay Hummel and John Phoenix, this introduction promises to redefine the traditional paradigms of advisor ownership through a unique equity structure. Instead of conventional RIA roll-up strategies, UWP empowers independent advisors by awarding them a remarkable 60% equity stake in their operations. Meanwhile, Hummel and Phoenix retain the remaining 40% through their consultancy, Wealth Advisor Growth Network (WAGN). The enterprise launched with a substantial initial investment of $50 million from a family office, underscoring the ambition of its founders. Drawing immediate attention, UWP successfully enrolled a notable team of advisors, including the $550 million in assets under management (AUM) group led by former Raymond James advisor Scott Shepherd. The firm aspires to reach $1.5 billion in assets under management by mid-year, underlining its rapid growth.
A Fresh Approach to Succession Planning
UWP distinguishes itself in the crowded field by positioning as an “RIA succession incubator,” focusing on advisors approaching retirement. This novel approach offers a strategic solution for succession planning, an often-overlooked aspect vital to the future stability of advisory practices. By implementing a capital model that provides advisors with immediate cash flow in exchange for equity, UWP facilitates both growth and succession planning in a seamless manner. The company’s strategy also includes annual reviews and adjustments to equity based on financial performance, ensuring that advisors remain pivotal both in operations and in decision-making processes. This approach is further augmented by the company’s five-year goal to target institutional sales of $5 billion to $10 billion in assets. Notably, a supermajority vote of 75% among equity owners is required for any prospective sale, reinforcing the autonomy and authority of advisor stakeholders within the firm. This stands in stark contrast to existing practices observed in the industry, where forced sales are more common, often leaving advisors with diminished influence over their operations.
Challenging Industry Giants
UWP’s clear emphasis on preserving advisor autonomy directly challenges the rigid models of prominent RIA aggregators like Creative Planning, Edelman, and Hightower. The firm advocates for an advisor-centric approach, steering clear of obligatory sales, thereby fostering a cooperative environment conducive to individual preferences. This methodology not only maintains advisor autonomy but also fully respects cultural and operational preferences that often clash with larger independent broker-dealers’ acquisition tactics. With backing from software partner LibertyFi, UWP extends its offerings to Commonwealth advisors navigating their futures post-Commonwealth’s acquisition by LPL. Through this outreach, UWP transparently addresses the dissonance between traditional broker-dealer structures and their acquired entities, creating a more harmonized vision of the financial advisory landscape. Advisors seeking to align their personal and professional aspirations with a firm that values collaboration and growth over forced integration see UWP’s model as increasingly attractive.
The Future of RIA Aggregation
United Wealth Partners (UWP) has ushered in a new era in the financial advisory realm with its innovative approach as an RIA aggregator. Led by industry veterans Jay Hummel and John Phoenix, UWP aims to transform the conventional advisor ownership model by implementing a distinctive equity structure. This strategy offers independent financial advisors a generous 60% equity stake in their operations, deviating from traditional RIA roll-up methods. Hummel and Phoenix’s consultancy, Wealth Advisor Growth Network (WAGN), retains the remaining 40% stake, promoting mutual growth. Bolstered by a significant $50 million investment from a family office, UWP’s launch indicates the founders’ ambitious vision. The firm rapidly gained traction by recruiting influential advisors, including Scott Shepherd, formerly with Raymond James, overseeing $550 million in AUM. With sights set on reaching $1.5 billion in assets by mid-year, UWP’s growth trajectory highlights its potential to shape the future of financial advising.
