How Stratos can become an M&A player
Updated: Dec 3, 2021
The $16bn firm's chief executive, Jeff Concepcion, explains how its recent investment from Emigrant Partners gives it acquisition firepower.
Roughly five months after its deal with Emigrant Partners, Stratos Wealth
Holdings’ deal making business has never been busier.
‘On the M&A front, we have more offer letters out now than we’ve ever had —
and they’re with bigger firms,’ said Jeff Concepcion (pictured), Stratos’ chief
executive. ‘We’re as active as we’ve ever been there in part because the pipeline
was great — we’re literally receiving inbound calls occasionally —and then
we’re probably a teeny bit bolder to be willing to do more because of Emigrant
coming on as a partner.’
Emigrant, a serial minority investor in RIAs, took a stake of undisclosed size in
Stratos on April 1. Stratos oversees roughly $16bn in assets through all of its
business lines, which includes several different affiliation options.
Stratos’ largest operation is Stratos Wealth Partners, an LPL-affiliated hybrid
RIA. The firm also maintains Stratos Wealth Advisors, a traditional RIA for fee-
only advisors who want to custody their assets with a firm like Fidelity or
Charles Schwab; Stratos Wealth Enterprises, an RIA acquisition vehicle, and
Fundamentum, an in-house asset manager.
Emigrant plans to help fund Stratos’ future acquisitions. Emigrant’s backing
gives Stratos the latitude to go after more prominent transactions, Concepcion
‘Had we not [taken the investment], the recruiting would be what it is, the M&A
efforts would be what they are, but we probably would have to be more selective
and walk away from some good deals because we might be hesitant to transact
too much without knowing we have those resources behind us,’ he said.
Stratos’ traditional advisor recruiting arm, which lifts out advisors from
brokerage firms and hybrid RIAs, has also been busy in recent months. In
August, the firm added a $375m team from Wells Fargo’s FiNet in Scottsdale,
Ariz. Stratos has also added $209m ex-JP Morgan advisor Samer Hilal and
$47m ex-Raymond James advisor Rob Apple to its ranks, among others.
‘I don’t think it’s unrealistic for us to have a couple billion in new assets joining
the platform separate and apart from any investments or acquisitions that we
make,’ Concepcion said