Sequoia targets 500 advisers by 2026 through small AFSL acquisitions

Sequoia Sequoia financial group AFSL financial advisers

15 November 2023
| By Laura Dew |
image
image
expand image

Sequoia has announced plans to boost growth by acquiring sub-scale licensees, noting only 2 per cent of AFSLs have more than 100 advisers.

In an ASX announcement, the firm said it is targeting 500 advisers within Interprac and Sequoia Wealth Management by 2026. 

This will be achieved by acquiring adviser licensing services from sub-scale AFSL providers with the firm noting that only 40 of the total 1,876 AFSL holders in the industry have more than 100 advisers. 

In FY24, it is seeking to have 15 per cent growth in advisers using its AFSL from 325 in FY23 to 380 in FY24. 

The firm said it is seeking to embark on this growth strategy at the current time because of commercial tailwinds from improved industry dynamics, enhanced leadership capability to drive earnings growth and a capital management program supported by strong balance sheet and compelling valuations. 

“For 20+ years, licensee services businesses have been competing on fees in competition with subsidised product provider AFSL holders, in the last 9-12 months as almost all providers have exited this subsidised price war which has abated,” the statement said.

“There is a shortage of advisers in advice, accounting and self-managed super fund (SMSF) administration to serve a community that is heavily weighted towards an age demographic that can pay for a service and needs assistance in managing their affairs.”

The firm urged product providers to reduce their costs to access the investment community, adding that Sequoia’s integrated model can assist such entities to do so.

Earlier this year, Wealth Data found some 27.1 per cent of the advice industry work at what it termed as “micro-AFSLs”, or those firms with less than 10 advisers.

“It’s difficult to know exactly ‘where’ financial planning models are heading, let alone if we have reached a destination. All the data tends to suggest that self-licensed models or micro-AFSLs, as we like to refer to them, have definitely shaken up traditional models,” Wealth Data founder Colin Williams previously said.

Moreover, the research house reported that licensee owners who commenced with between zero to less than 20 advisers have risen by 208 this year to October.

Sequoia is also seeking to increase its Family Office and Insurance Brokers by acquiring adviser customer books and employing specialist advisers in the high net worth market and by acquiring small to mid-size suburban broking firms.

Read more about:

AUTHOR

Add new comment

The content of this field is kept private and will not be shown publicly.
 

Recommended for you

 

MARKET INSIGHTS

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

Chris Cornish

By having trustees supervise client directed payments from their pension funds, Stephen Jones and the federal Labor gove...

2 days 22 hours ago
Chris Cornish

Now we now the size of Stephen Jones' CSOLR tax, I doubt anyone will be employer any new financial adviser from this poi...

2 days 22 hours ago
JOHN GILLIES

Amazing ! Between the beginning of licencing Feb 2002 and 2008 this was a very good stable industry.Then the do-gooders...

3 days 17 hours ago

AustralianSuper and Australian Retirement Trust have posted the financial results for the 2022–23 financial year for their combined 5.3 million members....

10 months 2 weeks ago

A $34 billion fund has come out on top with a 13.3 per cent return in the last 12 months, beating out mega funds like Australian Retirement Trust and Aware Super. ...

10 months ago

The verdict in the class action case against AMP Financial Planning has been delivered in the Federal Court by Justice Moshinsky....

10 months 2 weeks ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND