Key Points
- Abacus Wealth Partners is 100% owned by employees. Many of the people on your team helping guide your financial plan and support your financial life also own the firm, meaning they’re personally invested in your success – not answering to outside investors.
- 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.
At Abacus Wealth Partners, we believe that being an independent firm aligns with our client’s values and interests. That’s why we are proud to be 100% employee owned.
What’s the benefit of an employee-owned financial planning firm like Abacus? 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.
How Private Equity Ownership Is Changing Wealth Management
Over the last two decades, the wealth management industry has seen a shift in ownership. Many founders who started their businesses in the 1980s are approaching retirement, and they’re facing a tricky question: How can they follow their own advice and monetize the business they built?
Here’s the reality. Some firm owners might have a talented advisor ready to take over, but it’s not always realistic for a 40-year-old with a family and mortgage to buy the entire business. Meanwhile, other companies might be making offers far higher than what an internal successor could pay.
As a result, owners often 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.
Why Private Equity Can Hurt Investors
So, what happens when private equity enters the picture?
Private equity firms typically:
- Buy a company and leverage it with debt
- Hold it for a couple of years, approximately five to seven
- Collect fees along the way
- 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, “Purchases of nursing homes by private equity firms are associated with higher patient mortality rates, fewer caregivers, higher management fees, and a decline in 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.
How Employee Ownership Can Help Put Clients First
On the opposite end of the spectrum, employee ownership flips the script. Advisors who also own a share of the firm are often naturally motivated to put clients first.
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 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 can’t.
Why Employee Ownership Matters for Employees
Ownership can also help create a better employee experience. When your team has a voice, responsibility, and a stake in the future, they tend to stick around. 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 recently told me on his way out of his firm, “This just isn’t what I signed up for.”
Many fee-only CERTIFIED FINANCIAL PLANNER® (CFP®) 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.
Employee-Owned Financial Planning Firms Are 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 Employee Ownership Can Help Ensure Generational Continuity
When clients first meet with their advisory team, they often ask, “What happens if something happens to you? Who will help me and my kids?”
With employee ownership, the answer is clear: As a 100% employee-owned company, Abacus has built-in succession planning. Ownership transitions gradually to rising leaders over time, helping to ensure continuity for your family for generations. Our team gets 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.
Choosing a Different Path
At the end of the day, being a 100% employee-owned financial planning 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.
