Published on Citywire RIA on October 15, 2025 | Authored by Allen Darby

Opinion: How to tell M&A advisors — and their conflicts — apart

In this guest column, Alaris Acquisitions CEO Allen Darby breaks down the different types of RIA M&A advisors and what their processes, fee models and conflicts of interest mean for sellers.

ByAllen Darby

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As competition in the RIA M&A landscape heats up, we increasingly hear from prospective clients that we as consultants ‘all sound alike.’ But the reality is the M&A advisory space is quite differentiated. This is our view on what sellers should know about the differences between advisors, in the hopes of assisting them with the daunting journey of finding the right partner.

Bringing value

There are four key value components that any business owner should expect to receive when hiring an M&A consultant:

1. Education: The sell-side advisor’s first job is to educate the seller on the general landscape, the broad buyer models and the ins and outs of the process that they hope to embark on.
2. Data organization: The M&A advisor must gather and structure quantitative and qualitative data accurately and transparently, showcasing the seller’s strengths while providing sufficient explanations of any shortcomings or red flags. We want to give potential buyers the data they need to clearly determine if the seller is the type of firm they seek.
3. Matching mechanism: As advisors, our job is to play the role of matchmaker and identify vetted, quality buyers who are compatible with the seller across multiple data points. From there we can invite a highly compatible, curated buyer pool to a structured process between parties more likely to reach a point of cultural conviction. This includes managing a competitive financial process amongst potential buyers to arrive at the best possible outcome.
4. Closing ability: An understated part of the equation, advisors must be able to work through due diligence, transition preparation and legal consideration to close the deal all while managing the emotions of both parties. Like financial advisors managing the emotions and behavior of their clients, this is a critical part of the M&A advisor’s role.

How sell-side advisors approach these steps is what differentiates them. It tells you what they are optimizing for.

Focus on match

Of the four value components above, I recommend focusing the most energy on the matching process, as this is where sell-side advisors can make the biggest difference for their clients. There are three primary mechanisms for matchmaking in today’s M&A ecosystem:

1. Auctions: The most common format by far, even for advisors who claim they don’t run them, is the auction process. Auctions simply invite as many buyers as possible to the process, give them a seller profile and start the bidding. The highest bidders advance to the next round, while lower bidders are eliminated. The advisor whittles down the list accordingly and has the remaining parties interact with one another. Advisors typically run auctions because their knowledge of buyers in the space is limited to how they historically price and structure deals. This format is all about price and tends to ignore aspects of culture and compatibility, which presents serious risks for culture clash after a check is cashed. It’s a horrible process that has no place in the wealth management industry. Buyers loathe it. Sellers should too.
2. Relationships: Some M&A advisors attempt to curate a buyer list by only inviting buyers they already know to the process. One could argue this is a better process than the auction because the advisor knows more about the buyers and can give the seller meaningful guidance. However, it is limited to the number of buyers on whom the advisor has actual data or firsthand experience. If an advisor has a subset of buyers they routinely transact with, sellers must ask if they are getting broad enough exposure to the entire buyer pool. Another issue with this process is subjectivity. Sellers are heavily reliant on the advisor’s guidance to determine compatibility, and they should know the supporting rationale for any recommendation they receive and be comfortable that it is not just the advisor’s gut feeling or an attempt to win the favor of repeat customers.
3. Data-driven curation: This approach requires the sell-side advisor to have broad and deep data on the buyer pool. We don’t see many advisors willing to roll up their sleeves and do the hard work of getting to know buyers. But those who do can integrate technology into the matchmaking process. By cataloging buyers on a massive data set including business structure, fee models, client experience, investment program, training programs and practice management, advisors can run two-way compatibility screens across this objectively measurable data. They can target only buyers who are a match with the seller, and vice versa. This curated approach results in the ability to run a smaller process in which every invited buyer is a potential strong match.

Fees

Much attention is given to the various fee models employed by sell-side advisors. Every fee structure corrupts advice in different ways, so it is critical to understand how the advisor is paid and what conflicts of interest may exist. Pricing models are never perfectly aligned with all a client’s multifaceted objectives, and even structures designed to eliminate or minimize conflicts generally just relocate them. It becomes a question of which conflicts you prefer to manage. The only ways to fully eliminate pricing conflict in an M&A process are:

• Both sides know the same things (impossible)
• Identical objectives between parties (impossible)
• Perfect ability to measure value (impossible)
• No time preference differences (impossible)

More simply, the way to eliminate pricing conflicts is to eliminate the need for pricing, which means eliminating the exchange relationship itself.

Here is a non-exhaustive list of common conflicts in M&A advisor pricing models:

• Hourly billing
  • Potential conflict: Incentivizes slowness, inefficiency and overcomplication.
  • Example: An M&A advisor bills 500 hours ‘analyzing comps’ for a straightforward RIA sale that should take 100 hours

• Fixed project fee/retainer
  • Potential conflict: The advisor has no skin in the game, incentivizing corner-cutting and minimum effort, with no incentive to negotiate hard for better terms or price on the seller’s behalf.
  • Examples: An advisor charges a flat $300K fee but only brings 5-10 potential buyers, does minimal valuation work, uses template materials and doesn’t push back on inferior deal structure or terms. Or, an advisor charges $20K/month and drags out negotiations for 18 months, keeps finding ‘new issues,’ and takes on too many clients at once so your firm becomes one of 30 deals they’re ‘working on.’

• Pure success fee
  • Potential conflict: Quantity over quality, pushing bad fits, cares only about price, not culture.
  • Example: An M&A advisor pushes you to sell your boutique wealth firm to the highest bidder, ignoring other strategic buyers who are better fits for all the stakeholders (owners, team, clients).

No advisor has solved the fee conflict issue. Instead, they simply rationalize the risks to their own respective ‘pitch.’ There’s nothing inherently wrong with rationalizing one fee model over that of your competitors, but the key for business owners is to ask advisors where conflicts exist and determine if they have a process in place to address them.

When it comes to choosing an M&A advisor, track record matters — but it’s not enough. Sellers should press beyond the glossy pitch and ask the hard questions. Only then can you tell who is truly different.

Allen Darby is the CEO of Alaris Acquisitions, a sell-side M&A advisory firm for wealth managers and RIAs.

Opinion: How to tell M&A advisors — and their conflicts — apart