When four partners launched the money management firm now known as Buckingham Strategic Wealth, they wrote a one-page business plan with four goals.
They wanted to work with nice people, add value to clients’ lives, have fun and, ambitiously, amass $100 million in client assets.
Thirty years later, thanks to a merger announced this month, Buckingham will oversee 1,000 times the assets that its founders envisioned. And its chief executive, Adam Birenbaum, expects it to grow even larger.
Buckingham is merging with Boston-based Colony Group to create a firm with more than $50 billion under management, making it one of the nation’s top 10 wealth-advisory firms. Including a sister firm that handles money for independent advisers, the combined assets will swell to well over $100 billion.
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Buckingham and Colony are both owned by Focus Financial Partners, a New York company that’s spent two decades acquiring wealth managers around the country. Private equity firm Clayton, Dubilier & Rice, which bought Focus last year, seems to want to consolidate the 92 firms under Focus’ umbrella.
“The new private equity firm that has invested is creating space for things to be different,” said David DeVoe, head of California consulting firm DeVoe & Co. “They’re rethinking the overall business.”
That spells opportunity, Birenbaum said: “We believe over the next decade we will be able to be a destination for many of those firms, should they desire to join forces, to deliver better outcomes and experiences for their clients.”
Size is increasingly important as independent advisers compete with such giant organizations as Charles Schwab and Bank of America. “There’s power in scale in this industry,” DeVoe said. “Merger activity has been at a record high in the industry, and the No. 1 reason firms give for selling is to gain economies of scale.”
The emphasis on size is a departure for Focus, which used to say it wanted investment advisers to be entrepreneurs, not employees. Birenbaum, though, says the entrepreneurial spirit will remain.
He said 200 of Buckingham’s 700 employees, and about 100 Colony employees, are Focus shareholders. “That ethos continues,” Birenbaum said. “The opportunity…
Read More: Merger vaults Buckingham to top tier of wealth management industry