Commonwealth tech partnership focuses on advisor succession

Commonwealth Financial Network is helping its advisors do mergers and acquisitions and succession planning more effectively through a new strategic partnership.

Commonwealth has partnered with Succession Link – a fintech platform that’s focused on supporting M&A and succession planning in the wealth space – to help connect advisors within its network as they search for opportunities to buy, sell, merge, or plan the succession of their businesses.

“By integrating Succession Link's white-label solution into our existing framework, we're able to leverage its capabilities to match advisors looking for continuity and succession partners, buyers, or sellers with the best-fit opportunities based on their interests and needs,” Matt Chisholm, Commonwealth’s senior vice president of business solutions, said in a statement.

The need to support advisor succession planning comes through loud in clear in research from Cerulli Associates, which estimates 100,000 advisors representing $10 trillion in client assets are on track to retire in the next decade. Within that cohort, one-quarter said they have no concrete succession plan.

While succession planning in the industry used to be fueled by robust recruitment and advisor training programs, that talent funnel isn’t as reliable as before. Cerulli estimates 38 percent of financial advisors in the U.S. will exit the industry in a decade, while the “rookie failure rate” is nearly double that at 72 percent.

With the new solution in place at Commonwealth, the firm’s advisor affiliates will have a central platform to see practices for sale, which can encourage succession planning activity within the firm.

The platform also gives advisors the capability to conduct their own business valuations, anticipate deal terms prior to acquiring a practice, and allow exiting advisors to benefit from enhanced asset retention.

To help facilitate the matchmaking process, Succession Link’s platform has several features, including proprietary compatibility scoring, an advanced messaging dashboard, and custom search fields, as well as algorithms to match potential partners based on location, technology, AUM and other criteria.

“This collaboration underscores our dedication to empowering financial professionals, providing them with innovative tools that reshape the landscape of their business expansion and succession planning opportunities,” said Nicholas Gudz, co-founder of Succession Link. “We look forward to the positive impact this partnership will have on the entire advisory community.”