Published on Family Wealth Report on April 2, 2026 | Authored by Allen Darby

The Fee-Only Model Isn’t Conflict-Free. It’s Just Differently Conflicted

Allen Darby April 2, 2026

The author of this article argues that a mature approach to thinking about conflicts of interest is not to deny that they exist, but to disclose and manage them.

We like to encourage debate and conversations at Family Wealth Report and that includes commentaries made at other news services. An opinion piece in February at Citywire, entitled “The Case For Fee-Based Investment Banking” has prompted Allen Darby (pictured below), CEO at Alaris Acquisitions, a sell-side M&A consultancy for the wealth management industry, to respond. (FWR interviewed Darby last year.)

Rather than debating fee structures at face value, Allen challenges readers to think more critically about incentives, negotiation dynamics and the often-overlooked role of advisor competence in driving outcomes.

As always with guest writers, the editors don’t necessarily endorse all opinions, but we do value contributions to debate and encourage readers to respond. Email tom.burroughes@wealthbriefing.com and amanda.cheesley@clearviewpublishing.com

Allen Darby

RIA founders have spent careers explaining to clients why “my incentives are aligned with yours” is not the same as “I have no conflicts.” Even fee-only wealth managers – the standard-bearers of fiduciary advice – acknowledge conflicts in their own model: an AuM-based fee creates a structural pull toward keeping assets invested and under management rather than recommending a client pay down debt, purchase a home, or fund a business. Others exist as well. The mature response is not to deny these conflicts but to disclose and manage them. It is therefore striking to see an industry practitioner argue that her M&A advisory fee structure achieves what wealth management never claimed: to give conflict-free advice.

The article’s central thesis is that success-fee pricing models create pressure to close deals and maximize headline price at the expense of cultural alignment. In contrast, a retainer model allows advisors to give “honest, unpressured opinions” – including the freedom to tell a client to walk away. It’s a compelling pitch –but analytically incomplete and, at times, misleading. Conflicts of interest are not eliminated by removing a success fee. Instead, they are redirected. The issue isn’t whether conflicts exist, but where they point – and whether that is disclosed.

The true incentive of the retainer model

The author’s case rests on two false equivalencies. First, retainer-advisors can tell clients to walk away from a transaction, while success-fee advisors cannot. This is simply untrue. Success-fee advisors advise against transactions regularly and for many reasons – misalignment of fit, unfavorable market timing or terms that don’t reflect the firm’s value. That willingness is a function of professional integrity and long-term reputation, not fee structure. A success-fee advisor who pushes a client into a bad deal doesn’t just close a transaction; they close a referral pipeline. Fee models don’t necessarily equate to ethics.

The second false equivalency is more subtle: the author equates financial neutrality with objectivity. It’s not the same thing. A retainer advisor who is indifferent to whether a deal closes has no forcing function to drive a process forward, create competitive tension, hold buyers accountable on timeline or push through the friction that comes with every complex transaction. That is not alignment, it’s detachment framed as objectivity. Retainer models also reward complexity and penalize efficiency. More analysis, more optionality, more months on the clock – all billable, but not inherently in the client’s interest. A deal that could close in six months may extend to ten. And walking away guarantees that the meter keeps running.

Market efficiency and the incentive to negotiate

The author suggests that the RIA buyer landscape is “increasingly efficient” and that sophisticated buyers already know what firms are worth – implying that chasing the highest price is a distraction from finding the right partner. The premise deserves scrutiny. RIA valuations across comparable transactions routinely diverge by meaningful amounts, driven by deal structure, earn-out mechanics, equity rollover terms, employment provisions and post-close autonomy. Sellers who accept a compelling first offer without pressure-testing frequently leave significant value on the table.

More fundamentally, the author’s argument is self-defeating. She argues that incentives shape behavior. Applying that logic, a retainer-fee advisor has no incentive to negotiate. Whether the deal closes at a premium or discount, whether earn-out terms favor the seller or not, whether the seller retains meaningful post-close autonomy or quietly surrenders it in the fine print, their compensation is unchanged. If incentives shape behavior, a fee-only advisor will, at the margin, negotiate less aggressively than one whose compensation depends on securing the best possible outcome.

The author frames cultural alignment and economic outcome as competing priorities, but a well-run process produces both. The success-fee model ensures that the advisor is in the room fighting. The retainer model, by the author’s own logic, provides no such assurance.

How conflicts are actually managed

The article’s central assumption is that success-fee advisors define the best deal as the highest bid. It is a real pathology I have frequently accused our industry of low-quality M&A advisory processes known as auctions. However, it is not an inherent feature of the success-fee model, but a feature of a poorly designed process and unscrupulous sell-side advisors.

Consider the analogy to public accounting. Auditors are paid directly by the clients whose books they audit textbook self-interest threat. The profession didn’t eliminate fees; it implemented independent standards, controls and safeguards. The conflict remains, but it is managed.

Our process applies the same logic. Rather than running a broad auction, we screen buyers on dozens of objectively measurable dimensions of compatibility –operational model, investment philosophy, advisor incentives, cultural indicators, post-close autonomy – before a single introduction is made. We invite three to five highly compatible buyers, not fifty. We then structure an extended series of interactions designed to move from compatibility to cultural conviction, which can only develop through real time spent together.

Sellers ultimately choose from a small set of deeply vetted, culturally engaged buyers – on the full combination of fit, conviction and economics. Our job is to ensure that every option in front of them is genuinely worth choosing based on that degree of fit and culture, then negotiate like hell between those parties to achieve the highest economic outcome. That’s how a success-fee model manages its conflict: by aligning the advisor’s incentive to close with the seller’s goal of securing the right partner at a strong market outcome, not simply the highest bidder.

The overlooked variable: Competence

The most consequential omission in the author’s framework is competence. The fee model is a secondary consideration. The primary question when selecting an M&A advisor is whether the advisor is genuinely excellent at the work – transaction depth, buyer relationships, buyer data, structuring sophistication and the motivation to fight when things get hard. The best advisors command premium fees because they earn them. A less experienced advisor with a cleaner fee model can cost a seller millions through weaker terms, misaligned buyers or disappointing post-close realities.

This is not a novel insight. You don’t choose a surgeon for a complex procedure based on price, nor a litigator for high-stakes litigation based on hourly rate. In professional services, price often signals competence.

The author argues that sellers should not let price drive buyer selection. That’s correct. Yet her pitch to sellers is fundamentally price-based: choose a retainer model to avoid a success fee. This creates a contradiction – advocating for multidimensional decision-making in one context and cost-minimization in another.

What sellers should ask

Every fee model carries conflicts. Success-fee models bias toward closing and price optimization. Retainer models bias toward extended engagement and process complexity. Neither is conflict-free. Both can be appropriate when transparently managed.

The right questions are: How experienced is the advisor? What does their process actually look like? Where do conflicts arise, and how are they mitigated? An advisor who cannot answer these clearly, or who relies on fee structure as the primary selling point, has not made a sufficient case.

RIA owners have spent careers helping clients see through compensation-driven advice. They deserve advisors willing to extend the same courtesy.

The Fee-Only Model Isn’t Conflict-Free. It’s Just Differently Conflicted