Merchant Wealth’s David Haintz has described how the firm differs from the traditional private equity ventures jumping into Australia, and why M&A isn’t like Married at First Sight.
Merchant Wealth Partners is a New York-based capital partner that provides growth capital, management resources, strategic advice, and opportunities to advice and wealth management firms globally. The firm has partnered with 101 companies in six countries and collectively manages over $290 billion in assets.
It then set up its Australian subsidiary in 2022, with Haintz and Santiago Burridge, former co-founder of Implemented Portfolios, as founding partners.
Most recently, it set up a 50/50 joint venture with advice licensee WT Financial to provide strategic growth capital for its practices.
Speaking on a WT Financial webinar, Haintz said: “What I’ve witnessed in Australia with the capital partners is they are typically majority-controlled partners and taking 100 per cent or 51 per cent of the firm.
“I had a fundamental belief that in any professional services firm then you have to keep the majority of the people who are doing the work. I was looking to bring a minority-capital partner to Australia, one of the key words was ‘alignment’ where we want to be aligned with our partners rather than controlling them.”
Unlike aggregators, he said Merchant only wants to work with like-minded entrepreneurial advice firms that are actively seeking to merge or work together.
“We are not an aggregator; WT is saying ‘who’s entrepreneurial, where do these personalities fit’ and having discussions about whether that is something they’d like to do. It isn’t a case of putting Firm A together with Firm B like on Married at First Sight, and hoping they get along. We are not looking to create ‘arranged marriages’ here.”
The final difference, he said, is around the time horizon that an investor commits to when working with Merchant.
“Anyone that invests into Merchant is investing with long-term patient capital and anyone who puts money in must commit to a minimum 15-year duration, and that is a massive differentiator from the traditional private equity that would be working for six to seven years where they need to get their money off the table.
“We just partner with great entrepreneurial advice practices, that’s all we do. We are hands-on operators. We don’t want to get in their way, but we want to help them where we can, and we have a really great track record of growing firms at significantly above-average rates.”
