Business is booming.

Sanctuary Announces First Deal in Partnership Program

Sanctuary Wealth, a support platform for breakaway advisors, announced a new partnership program, a joint venture with affiliated firms Concenture Wealth Management and G Squared Private Wealth, which have offices in Houston, College Station and Galveston, Texas. Sanctuary has taken minority stakes in those firms and helped them create an entity called 6 Degrees with the intention that the firms launch an acquisition strategy in the Southwest.

Jim Dickson, CEO and founder of Sanctuary Wealth, said this is the first of many transactions his firm will do with partner firms, where Sanctuary will co-invest alongside partners so that they can do M&A themselves. Dickson predicts Sanctuary will do 15 to 20 of these partnership deals per year.

“One of the challenges to doing M&A is the capital,” Dickson said. “Because they’re part of our network and we own a minority stake, this allows them a much easier path to participate in the M&A space by doing it with us.”

6 Degrees, which operates under Sanctuary’s registered investment advisor and broker/dealer, is led by CEO George Georgiades, Chief Investment Officer Victoria Greene and President Robert Gilliland.

“Our goal in creating 6 Degrees is to give individual advisors the pricing and synergies of a national firm but with local leadership to help them live the life and grow the business the way they want to,” said Georgiades, in a statement. “We aim to bring accessibility, investment acumen, experience with different types of clients, and the lessons we learned in making our own move to independence.”

Jason Hardcastle, formerly an advisor with Edward Jones, is the first advisor to join 6 Degrees and will be based in Galveston.

Sanctuary’s initial growth strategy was to build a network of breakaways; it currently has about 50 firms in the network, and that channel is still growing. Then in late 2020, it raised $50 million through European-based asset manager Azimut Group, which took a majority stake in the firm, for M&A. The firm started acquiring RIAs itself as a way to expand the network; Sanctuary completed three of those deals last year, and the firm expects to announce another three in the next 60 days. 

This partnership program, which Sanctuary has been working on for the past year, is a third growth strategy; it allows partner firms to use Sanctuary’s capital to leverage their relationships on a local level and do tuck-ins and acquisitions.

“If you think about our model, they traditionally break away from a wirehouse, they set up their own independent practice, we then take a minority stake always in that practice, and then together we go out and do M&A with some of their relationships and our capital,” Dickson said. “We’ve got these great partners—60 of them across the United States and Latin America; they’ve got great reputations; they’ve got great relationships. So when we sat down and we talked about our growth strategy, we said, ‘Why wouldn’t we leverage that?’”

Sanctuary has partner firms across 22 states with over $19 billion in assets under advisement. 

“Now, versus doing five deals a year, we can do a lot more because we’ve got boots on the ground across the country that we’re doing deals with that allows us we think to grow a little faster,” Dickson said.

Source link

Comments are closed, but trackbacks and pingbacks are open.