29Jul2025

Whatโ€™s Your Wealth Firm Really Worth? ๐Ÿ”

Disclaimer: The views and opinions expressed in the vapa Swiss independent wealth management blog posts featured on this page are solely my own and do not necessarily represent the views of any institutions or organisations I may be associated with. These posts are intended to share personal insights and perspectives and should not be interpreted as official statements or positions of any affiliated entities.

The valuation in Wealth Firms isnโ€™t just a number โ€“ itโ€™s a strategy.

Everyone in independent wealth management has heard the benchmarks: 6โ€“10x EBITDA, or 0.75โ€“1.5% of Assets under Management (AuM). However, in real-world M&A, these figures are just the headline. The real story is told in adjustments โ€“ discounts or premiums โ€“ based on quality, not quantity.

๐Ÿšซ Where value is lost

  • Ageing client base ๐Ÿ”ป: If most clients are 70+, and thereโ€™s no link to the next generation, a 20โ€“30% discount isnโ€™t unusual.
  • Client concentration ๐Ÿ”ป: One client driving 25โ€“30% of revenue? Itโ€™s efficient until it isnโ€™t โ€“ and buyers notice.
  • Cross-border exposure without structure ๐Ÿ”ป: Serving clients from emerging markets? Fine โ€“ but not without clear KYC, compliant onboarding, and transparent fund origins.
  • Founder dependency ๐Ÿ”ป: If the business is the founder, expect buyers to price in succession risk.

โœ… Where value is created

  • Recurring revenues >70% ๐ŸŸข: Predictability is king.
  • Operational scalability ๐ŸŸข: Tech-enabled, cost-efficient models attract higher multiples.
  • Structured international business ๐ŸŸข: Global clients arenโ€™t a risk if you manage them well, with process, transparency and regulation.

Why this matters

The Swiss wealth management market is heading towards consolidation with sophistication. Buyers are no longer just buying AuM โ€“ theyโ€™re buying systems, teams, compliance maturity and client longevity.

Understanding these valuation levers isnโ€™t just for sellers. Itโ€™s strategic intelligence for anyone shaping a firm’s futureโ€”whether through acquisition, succession, or transformation.

๐Ÿ’ฌ Whatโ€™s the most overlooked value driver in our industry today?

Source: LinkedIn

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Safe illustration showing hidden valuation drivers beyond EBITDA and AuM in independent wealth management

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