When people talk about selling or partnering with a financial planning business, the conversation often collapses into one thing: “What multiple can I get?” It’s an understandable question. But on its own, it’s a blunt instrument.
Different types of buyers pay different multiples for different reasons and those reasons have a huge impact on what actually happens after the deal.
Instead of asking “Who will pay me the most today?” ask “What outcome am I optimising for over the next 5, 10, or 20 years?” When you ask that question, the answer often changes.
The Four Buyer Types
Private Equity
Buying control with a defined exit horizon. Higher multiples for scalable businesses but the business is being prepared for another sale.
Aggregators
Majority stakes, centralised infrastructure, standardised models. Competitive multiples, but reduced autonomy and cultural convergence over time.
Another Advice Firm
Recurring revenue multiples for client base transfer. Clean one-off outcomes but transactional. Once clients are transferred, the relationship ends.
Broadleaf Financial Group
EBIT-based, minority ownership, ongoing business. Initial multiple looks conservative but total value realised over time is significantly greater.
Transactional Multiple
- One payment - then the relationship ends
- Business is optimised for a buyer, not its people
- Value crystallised once, then reset to zero
- Ownership and decision-making transfer away
- Compounding stops the day the deal closes
Total Multiple (Broadleaf)
- Value realised upfront and then continuously
- Business continues for its people, team, and clients
- Value builds on value, compounding over decades
- Majority ownership and decision rights stay with you
- Optionality increases rather than disappears
Why Compounding Is Underestimated
Short-term transactions feel decisive. Compounding feels slow, until it isn’t. Staying invested in a high-quality, growing business means:
- Profits are earned year after year
- Value builds on value
- Optionality increases rather than disappears
The maths is often less dramatic on day one but far more powerful over a decade.
Choosing the Right Buyer
Every buyer type has a role. The right choice depends on:
- What you want next
- How important independence is to you
- Whether you want a clean break or an ongoing role
- How you think about legacy, people, and clients
The mistake is assuming the highest headline multiple always delivers the best outcome. Often, it doesn’t.
"With Broadleaf, owners typically realise a portion of value upfront, retain majority ownership, continue to receive growing profit distributions, and participate in future value creation. Over time, the total value realised significantly exceeds a one-off sale, even if the initial multiple looks more conservative. This is the power of compounding."