Every buyer has their own criteria, but buyers of retirement plan practices tend to ask about the same areas. Sellers who understand these can prepare better information. Buyers can use the list to compare opportunities consistently.
Plan mix and size
Buyers look at the number of plans, total plan assets, the spread between large and small plans, and participant counts. Many firms have a target plan size that fits their service model.
Recordkeeper concentration
A book concentrated on recordkeepers the buyer already works with is easier to service and transition. A book spread across many platforms may need more effort.
Service model fit
Buyers check whether the seller acts as a 3(21) co-fiduciary, a 3(38) investment manager, or a non-fiduciary service provider, and how that compares with their own approach. A big change in service model can complicate plan sponsor approvals.
Agreements and disclosures
Current service agreements and 408(b)(2) disclosures for every plan show that the book is well run and make new agreements easier to put in place.
Fiduciary documentation
Investment policy statements, monitoring reports and committee minutes let a buyer continue each plan's process without gaps.
Relationship depth
Buyers ask how long plans have been with the advisor, how often committees meet, and who on the seller's team the sponsors know. Long, active relationships with more than one contact tend to transition well.
Compensation structure
How the advisor is paid on each plan, and whether any arrangements depend on a particular broker-dealer or RIA, affects how the book can be integrated.
Staff and capacity
Experienced service staff who know the plans can be one of the most valuable parts of a practice. Buyers also consider whether they have the capacity to serve the added plans well.
Attached business
Wealth management for business owners and participants, nonqualified plans and related services matter a great deal to some buyers and very little to others. Clear separate information helps both sides.
Transition plan
Buyers want to know how long the seller will stay involved and how plan sponsors will be introduced. A realistic transition plan reduces risk for everyone.
RPPEx is built for this market. Sellers list for free and confidentially; buyers register their acquisition criteria and request introductions to practices that fit.