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Company Details
LPL Financial, LLC was formed in 1989 through the merger of two small brokerage firms, Linsco and Private Ledger. The firm was established with a mission to support financial advisors in their practice management and client service, aiming to protect and grow their clients' wealth. Over the years, LPL Financial has achieved significant growth milestones, including becoming a publicly traded company and managing approximately $1 trillion in assets.
In the past few years LPL has decided to become an acquirer of wealth management firms as well, since 2022, LPL has completed around 20-25 local advisor acquisitions, contributing to its expansion and market presence.
Given LPL's historic position as the dominant independent broker dealer to advisors, they have not focused on any specific segment of the client market. The target client demographic includes a wide range of individuals based on local advisor preferences, with no specific niche.
LPL Financial's investment program is designed to support advisors in serving their clients' best interests through a supported independence model. Advisors have the autonomy to manage and trade their own models while leveraging LPL's resources and open architecture platform. The firm emphasizes a growth culture, aiming to protect and elevate what advisors have built. LPL aims to be the largest wealth management platform in the advisor space, serving more advisors with an independent spirit in mind.
At LPL, advisors are permitted to manage and trade their own models while providing options to utilize LPL models. Advisors can build their models on the Strategic Asset Management platform and trade them using the Enhanced Trading & Rebalancing Platform. The platform supports a broad range of alternative investments, including non-traded REITs, BDCs, single strategy, and FOF hedge funds, private equity, private real estate, managed futures, exchange funds, qualified opportunity zone funds, and interval funds.
Advisors have direct access to the investment team for questions and insights and can provide feedback and request customizations for specific client needs.
LPL's platform includes a variety of alternative investments such as non-traded REITs, BDCs, hedge funds, private equity, private real estate, managed futures, exchange funds, qualified opportunity zone funds, and interval funds. Alternative investments are managed through a combination of in-house and external partners. LPL selects alternative investments based on track record, ability to take in fund flow, and approval by LPL Research
Locations
Company Videos
Acquisition Model
Full Acquisition
LPL does not offer equity as a component of their transaction.
Yes
Earnout paid 36 months after deal close based on AUM growth over the 36-month period.
Max Cash: 100%
Max Equity: 0% Due to LPL being a publicly traded company, 0% equity is issued as part of the transaction.
80% of the consideration is paid upfront, with 20% held in a retention payment for 6-18 months.
The compensation for partners and advisors will be set at 30% of top-line revenue, including both new and existing clients.
Mandatory Points of Alignment
Advisors can retain their own brand if they choose.
LPL ask advisors to centralize all non-client facing activities such as, operations, compliance, payroll, etc. While LPL has a preferred tech stack, they are flexible.
While LPL has a host of additional services beyond financial planning and portfolio management, advisors have complete discretion over what is reccomeded to clients.
Advisors will have visibility into their local P&L with yearly and quarterly budget reviews to examine expenses.
LPL's approach to financial planning emphasizes preserving independent investment advice while leveraging the scale and resources of a large firm.
LPL believes that each advisor has a unique client experience and does not require advisors to change how they serve their clients. The only requirement LPL asks of its advisors is to utilize the same client onboarding technology.
LPL has a strong practice management program they encourage their advisors to adopt.
Within LPL's system, advisors maintain complete autonomy, allowing them to efficiently manage and trade their own models.
Advisor Value Proposition
LPL offers a unique partnership opportunity for firms seeking to leverage the advantages of a trillion-dollar enterprise while maintaining operational flexibility. With extensive resources and an 8,000-person workforce, LPL provides a means to de-risk the business and optimize firm operations. Furthermore, their commitment to investing in training and supporting G2 advisors creates a growth culture. In LPL’s commitment to fostering growth and innovation, they have established the Advisor Institute, designed to provide comprehensive training for new advisors. This initiative includes a cohort-based program spanning one summit and academy, strategically tailored to equip individuals with the necessary skills and knowledge to excel as leaders and financial advisors. Recognizing the pivotal role played by the G2, LPL understands the significance of incentivizing them and empowering them with control over the future. A transaction with LPL’s Liquidity & Capital team bridges G1’s monetization with G2’s ascent to leadership.
LPL has a central para-plannng team advisors can leverage for an additional fee.
Advisors can simplify their workflow by offloading all non-client-facing operations (compliance, marketing, staff management, payroll, technology, etc.) to the corporate teams at LPL. This enables them to focus more on providing quality service to their clients.
One of LPL's core principles is that the advisor defines their growth, and it’s their job to support it. There are a range of live events, training, and on-demand learning opportunities the advisor can select throughout the year. Additionally, they have a variety of consulting teams the advisor can engage with at any time to help find growth opportunities in their existing book or create strategies to capture new business segments. These include: Advisory Consulting: The team is made up of experienced subject matter experts who are committed to helping the advisor grow by strengthening their client relationships and enhancing the value of the fee-based practice. Financial Planning: Grow the financial planning practice and help the advisor answer all their clients’ questions with the support of a team of CFP® professionals. This is an additive cost. Insurance: LPL’s insurance agency will fully support the advisors' insurance business with competitive payouts, a wide range of products, insurance technologies, and support across the sales and operational lifecycle. LPL Research: Have access to one of the largest independent research teams in the industry, whose mission is to provide independent investment research to support financial advisors as they help investors work toward their individual goals. Marketing Consulting: This team can evaluate and help optimize the advisor's current marketing efforts, collaborate with them to develop a brand, and introduce you to new tools and strategies. High-Net-Worth Services and the Private Trust Company: Compete for, win, and retain high-net-worth clients ( minimum of 5M of investable assets) with access to specialized experts who can give the advisor advice and implementation strategies for this market. Their expertise covers the spectrum of wealth management, including portfolio construction, risk management, investment strategies, estate planning strategies, and wealth preservation. Retirement Partners: Access experienced retirement plan consultants, platforms, and tools to help the advisor manage all aspects of retirement plan sales and servicing, from pre-sales opportunities to ongoing plan services and management. Wealth Consulting: Wealth Consulting gives the advisor support, tools, and resources necessary to service additional assets among existing clients and seek new opportunities for growth.
As the all-encompassing marketing hub, LPL's Marketing Consulting serves as the go-to resource for evaluating and enhancing current marketing endeavors. The team at LPL collaborates closely with advisors, offering expertise to develop a compelling brand identity and introduce innovative tools and strategies. With a dedicated marketing consultant who brings a wealth of experience, LPL's Marketing Consulting team specializes in ghostwriting content in the advisor's voice and conducting monthly reviews with advisors. The approach extends to crafting a highly customized engagement strategy, including impactful blogs and tailored digital perspectives. From managing Google ads to organizing client events, LPL promotes a comprehensive and effective marketing presence. To showcase ongoing engagements, LPL provides monthly reports to advisors, exemplifying their commitment to sustained success.
LPL has strong practice management structures in place to help advisors across various facets of organizational development. Notably, each advisory business is paired with a dedicated Field Management team using intimate support ratios, who works hand in hand with the advisors and staff to support the business. The dedicated Field Management team will serve as a concierge into LPL and will ensure that the resources and support provided by LPL are aligned to each advisor’s unique goals and objectives. In addition to helping identify and implement strategic initiatives, Field Management plays a crucial role in actively engaging and supporting the staff in day-to-day operations of each business. The Field Management team focuses on coaching and developing all advisors, providing training for Customer Service Associates (CSAs), and ensuring that career pathing opportunities are in place for the staff. Furthermore, Field Management will work with advisors to help structure and implement a thoughtful succession strategy to help transition control of the business to the right successor advisors. This team conducts regular check-ins, either weekly or monthly, based on the advisor's preference, to ensure effective communication and coordination.
AUM Growth
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