Embracing the growth opportunities of working in a PE backed Wealth Manager

Enhancing Business Operations
Better Technology
Within wealth management, PE backed firms are making acquisitions of firms at all values. From two adviser SMEs to large household names, we’ve seen buy-outs across the spectrum. Indeed, roll-up strategies can involve buying very small owner/managed business, who often still have relatively manual processes. The impact of PE upgrading systems can be material to both business operations and valuations. We see many private equity firms invest heavily in upgrading the technology infrastructure of their portfolio companies. Indeed for many, it’s often one of the furst steps they take. This includes implementing advanced software for customer relationship management (CRM), financial planning, and compliance monitoring. Enhanced technology streamlines operations, improves data accuracy, and enables better client service. For example, automated reporting tools can reduce the time spent on manual data entry, allowing advisers to focus more on strategic client interactions. It also helps management get everyone onto one single “source of truth” which supports better management of the business.
Improved Reporting
Accurate and timely reporting is crucial for informed decision-making in any firm, and wealth management is no exception. PE firms emphasise robust reporting mechanisms that provide insights into business performance, client portfolios, and market trends. By adopting these practices, wealth management firms can make data-driven decisions, identify growth opportunities, and mitigate risks more effectively.
Streamlined Processes
Process optimisation is a key area where PE firms add value and this usually falls under the remit of the assigned Operating Partner, who is there to support the ExCo. They bring in expertise to streamline workflows, reduce redundancies, and enhance efficiency. This can involve reengineering business processes, adopting best practices from other industries, and leveraging technology to automate routine tasks. The result is a more agile, responsive organisation that can better serve its clients and adapt to changing market conditions.
Increased Qualification Levels
PE-backed firms often prioritise professional development and certification for their employees. By encouraging and funding advanced qualifications, such as Chartered Financial Planner status, they ensure their staff possess the highest levels of expertise. This not only enhances the firm's credibility, but also contributes to employee satisfaction and retention. The real value in many professional services firms is the people and so retention is crucial, but an upskilled workforce can also help with valuations.
Personal Growth Opportunities for Executives
One of the most common reactions we get from people who start working with PE is “I’ve learnt so much”. People leading wealth management firms are often seasoned execs, but they are seeing their skillsets expand and here are some of the areas we feel individuals see personal growth.
Insight into Target Identification
Working with private equity provides executives with valuable experience in identifying acquisition targets. PE is clearly very good at this, and each PE firm will have its own methodology for identifying suitable targets. This involves analysing potential investments, assessing strategic fit, and understanding market dynamics. Such experience is invaluable for career growth, equipping executives with the skills to drive business expansion and identify new opportunities.
Understanding Metrics
Private equity firms use a range of financial and operational metrics to evaluate business performance and make investment decisions. Executives gain insights into these metrics, learning how to interpret data, measure success, and implement strategies to achieve targets. This analytical expertise is highly transferable and beneficial for future roles in any industry. It’s typically a new perspective for many wealth management leaders, who have perhaps “grown up” in the industry and who haven’t been exposed to different ways of working.
Exposure to Funding Structures
PE involvement exposes executives to various funding structures, including leveraged buyouts, growth capital, and recapitalisations. Understanding these funding mechanisms, and building a network with relevant advisers, enhances an executive's financial acumen, making them more adept at managing capital, negotiating financing terms, and optimising the firm’s capital structure.
The Positive Impact on CVs
Experience with private equity-backed firms is a strong addition to an executive’s CV. It signals to potential employers that the individual has exposure to financial metrics and funding structures, operational improvements, experience of change, and exposure to formulaic growth strategies. Also, you develop track record with key individuals from the lucrative world of PE. One successful assignment can lead to another.
Like any relationship, it’s important to see if your values and outlook align with the firm you’re joining or are already part of. This is no different with PE backed firms. A successful stint in a PE backed firm can be an invaluable experience for the executive keen to develop their career.
About Fram Search
Established in 2010, Fram Search is a specialist financial services recruitment consultancy. We focus on mid-to-senior hires in the UK and internationally. Fram has one of the leading Wealth Management recruitment Practices in the UK.
We provide high quality contingent and retained recruitment services to boutiques and global brands. We have long established relationships, outstanding market knowledge, and access to deep talent pools. Fram takes a highly consultative approach, combining outstanding tech with a human approach. We are proud that our contingent fill rate is nearly three times the industry average and we augment our retained search methodology with rigorous psychometric testing. We take ESG seriously, we are champions of diversity and all staff have undertaken unconscious bias training. We also carbon offset.
Please contact us on 01525 864 372 / [email protected] to learn more.
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