Key Points
- Abacus Wealth Partners is 100% employee-owned, meaning many of our financial advisors and support team have a personal stake in the firm’s success, not outside investors. In an industry where 89% of RIA acquisitions are private equity-funded, independent ownership is a meaningful differentiator for clients who want aligned, long-term financial guidance.
- Private equity is reshaping wealth management. Many firms are being sold to outside investors, who often prioritize short-term profits over client care. When ownership shifts to private equity, it’s not uncommon for the care and mission of the business to get deprioritized.
- Employee ownership helps create stability and continuity. This model helps to ensure long-term stewardship, client-first decision making, and a culture that attracts and retains top talent.
Is Your Financial Advisory Firm Owned by Private Equity?
Many people choose a financial advisor based on trust, their credentials, their communication style, and how well they listen. But there’s a question investors sometimes don’t think to ask: Who owns the firm?
Ownership matters more than you might expect. In 2024, 89% of RIA acquisitions were financed by private equity, according to Fidelity’s annual M&A report. That means the majority of financial advisory firms being bought and sold today are being purchased by outside investors whose primary goal is profit, likely not your financial wellbeing.
At Abacus Wealth Partners, we’ve chosen a different model. We’re a 100% employee-owned financial planning firm, meaning many of the advisors guiding your financial life are also the people who own and steward the business. No private equity. No outside shareholders. Just a team personally invested in your long-term success.
Why Does Ownership Structure Matter to Abacus?
We believe that being an independent, employee-owned firm aligns with our clients’ values and interests and that alignment shapes the decisions we make.
What’s the benefit of an employee-owned, financial advisory firm like Abacus? The benefit is that the people guiding your financial future, listening to your hopes, fears, and goals are also some of the same people who own and steward Abacus. We don’t answer to private equity firms or distant shareholders. Instead, we’re invested, personally and professionally, in building a company designed to thrive long-term, helping you have confidence in the continuity and care we provide.
Fifteen years ago, being employee-owned might not have seemed revolutionary. But today, as consolidation and private equity ownership reshape the financial advisory industry, 100% employee ownership isn’t just unusual; it can be a meaningful differentiator for our clients, our team, and the communities we serve.
Why Are So Many Financial Advisory Firms Being Sold to Private Equity?
Financial advisory firms are increasingly being sold to private equity because many founders who built their businesses in the 1980s are now approaching retirement, and internal succession isn’t always financially feasible. A talented advisor ready to take over may not be able to buy the entire business, and outside buyers are often able to make offers far higher than what an internal successor could pay.
As a result, some owners opt to sell to larger firms or aggregators, many of which acquire dozens of smaller firms each year. One of the most troubling aspects is where the money is coming from. According to Fidelity’s 10th annual M&A report, 89% of mergers and acquisitions of Registered Investment Advisors (RIAs) were financed by private equity in 2024.
How Does Private Equity Ownership Affect My Financial Advisory Firm?
When private equity acquires a financial advisory firm, the focus typically shifts from client care to short-term profit extraction. Private equity firms generally buy a company, leverage it with debt, hold it for approximately five to seven years, collect fees along the way, and exit by selling for a profit.
This model works for financial engineering, but not for care-based businesses. When ownership shifts to private equity, it’s not uncommon for the care and mission of the business to get deprioritized.
Let’s look at the eldercare facility industry, for example. In the early 2000s, private equity started buying up nursing homes and assisted living facilities, and the results have been devastating. According to the National Bureau of Economic Research, private equity acquisitions of nursing homes have been linked to higher patient mortality, reduced staffing, increased management fees, and declining patient mobility.
The same risk can be applied in financial services. If ownership is driven by short-term profit goals, client care can be at risk of being compromised.
What Are the Benefits of an Employee-Owned Financial Planning Firm?
At an employee-owned firm, the advisors guiding your financial life have a personal stake in your success because they also own the business.
That’s why Abacus is 100% employee-owned. Because we’re fiduciaries and owners, our leadership can take a long-term view, investing in ways that scale sustainably and help to improve our clients’ lives. Our decisions are guided by what’s best for the client, not by pressure to deliver quarterly returns to outside investors.
It’s simple: when the people managing your money also own the firm, they’re more likely to be aligned with your success. Private equity can’t always achieve that, because its sole purpose is to make money. And if a firm is motivated only by profits, how can clients be sure the advice they receive isn’t compromised? They probably can’t.
How Does Employee Ownership Affect Financial Advisors?
Employee ownership can help to attract and retain experienced financial advisors because mission-driven CFP® professionals likely will stay at a firm where they have a voice, a stake, and the freedom to put clients first. That stability can help benefit clients, colleagues, and the firm’s culture.
Contrast this with financial firms sold to private equity. Financial advisors at firms that sell to outside entities often face pressure to serve more clients with fewer resources to deliver quality service, sometimes leading to burnout and advisor attrition. One advisor shared with me on his way out of his firm that, “This just isn’t what I signed up for.”
Many fee-only CERTIFIED FINANCIAL PLANNER® professionals enter this field for a similar reason: to help people. If the firm’s integrity is compromised, the most talented professionals are at risk of leaving. At Abacus, employee ownership helps us attract and retain mission-driven CFP® professionals who want to build meaningful client relationships and grow with the firm for decades.
A business is its people, especially in the finance industry. If you don’t retain good people, your business can be at risk. Employee ownership at Abacus will continue to help us retain and attract some of the best talent in the financial services industry.
Are Employee-Owned Financial Planning Firms Built for Long-Term Success?
You might worry that an employee ownership model falls in the “do good” camp more than in the “positive results” camp. But research suggests employee ownership is correlated with higher company performance due to greater stability, fewer layoffs during downturns, and higher company survival rates. Plus, companies owned by private equity declare bankruptcy 10 times more often than those who aren’t owned by private equity.
When times get tough, employee owners don’t just see numbers on a spreadsheet, they see their colleagues, clients, and community. That shared responsibility can help drive resilience. They are more likely to come together to weather a storm and fight for the company and clients’ success.
How Does Employee Ownership Help Create Long-Term Stability for Clients?
Employee ownership helps create long-term stability for clients through built-in succession planning, helping to ensure you and your financial plan are protected even as individual advisors retire or transition over time.
As a 100% employee-owned company, Abacus puts this into practice through a gradual ownership transition to rising leaders over time. Ownership transitions gradually to rising leaders over time, helping to ensure continuity for generations. Our team has the opportunity to own the company, with retiring owners selling to new owners. This process creates a positive flywheel.
My team has frequently heard me talk about the “100-Year Organization.” An organization that is thoughtfully designed, constantly evolved, and focused on conviction can be built to last. Employee ownership can help encourage all these things to happen, and can help to increase the chances that Abacus will become a 100-Year Organization.
Abacus’s Commitment to Independent, Employee Ownership
Being a 100% employee-owned financial advisory firm isn’t just about who holds the shares; it’s about who holds the responsibility. At Abacus, the people you know and trust to help support your financial values and goals are also helping shape the future of our company and honor our mission: expand what’s possible with money. You can see Abacus’s partners and owners here.
In an industry increasingly dominated by private equity, Abacus is choosing a different path: independence, stewardship, and longevity. That’s how we can help serve you better today, and how we can be here for your children and grandchildren tomorrow.
If you’re looking for a financial planning team that’s invested in your success, and not outside shareholders, schedule a call with an Abacus advisor today.
Frequently Asked Questions
An employee-owned financial planning firm is one where the advisors and staff hold ownership stakes in the business rather than outside investors or private equity firms. At Abacus Wealth Partners, this means the people guiding your financial plan are personally invested in the firm’s long-term success.
Private equity firms typically acquire advisory firms, load them with debt, and sell within five to seven years for profit. Employee-owned firms like Abacus have no outside investors, so decisions are driven by client outcomes and long-term sustainability rather than short-term financial returns.
A fiduciary financial advisor is legally and ethically required to act in your best interest at all times. At Abacus Wealth Partners, our advisors are fiduciaries and many are CERTIFIED FINANCIAL PLANNER® professionals, meaning our recommendations are guided by what’s best for you, not what generates the most revenue for the firm.
You can ask directly who owns the firm and whether it has received any outside investment. You can also research the firm’s ownership structure on their website or through the SEC’s Investment Adviser Public Disclosure database. According to Fidelity’s 2024 M&A report, 89% of RIA acquisitions were financed by private equity, making it increasingly important to ask this question.
When a firm is acquired, clients may experience advisor turnover, changes in service levels, or shifts in the firm’s investment philosophy. At Abacus, our employee ownership model includes built-in succession planning, with ownership transitioning gradually to rising leaders over time, helping to ensure continuity for you and your family.
Yes, Abacus Wealth Partners is 100% employee-owned with no private equity investment or outside shareholders. You can meet our partners and owners on our company’s team page.
