Shirl Penney Eyes Independence Day for Dynasty's $100B Milestone

“Usually in any new movement … you have kind of the rugged individualist, the pioneers if you will, early on, but once that path starts to get worn, the next group that comes tends to be a larger group,” Penney said. “Now that the path and road to independence is so well-traveled, I think you’re going to see larger, more sophisticated teams that have larger, more sophisticated end clients continue to move to independence quickly.” 

This “rapid professionalism” of the RIA industry is why Dynasty has invested in growing its team. In addition to hiring Andrew Marsh in September as the company’s first vice chairman and Ron Insana in July as chief market strategist, Dynasty has invested “north of seven figures” in executive education and formed a partnership with the MIT business school, Penney said. 

Market conditions have undoubtedly affected M&A activity in the space. Credit is much tighter in the current interest rate environment and there has been a pullback in terms of valuation, Penney said. However, when market dips lead to a cut in wirehouse advisors’ compensation, it’s only natural for them to explore whether going independent can improve the economics of their practice. 

The number of deals will accelerate in the next 12 to 24 months as aging advisors realize they can’t keep waiting for a “perfect time” to strike a deal, Penney said. 

And once these advisors go independent, they don’t look back. 

“There are no break-back brokers,” Penney added. “There has never been a $500 million-plus team that has ever gone independent that has gone back. It’s a one-way street.”