Lido Advisors, the $29 billion Los Angeles-based firm backed by Constellation Wealth and Charlesbank Capital Partners, is bringing on board a $720 million registered investment advisor based in Arizona that focuses on working with high-net-worth families.
It’s the latest in a series of deals Lido has made since Constellation’s minority stake in January of last year. Henry Hagenbuch, a senior managing director and head of mergers and acquisitions at Lido, said he’s not concerned that the market for quality M&A deals will dry up any time soon.
“When you have a market that’s actually growing despite the consolidation …. I think there’s going to be a great opportunity for a lot of firms, and I don’t think it’s going to dissipate,” he said.
Copperwynd Financial serves clients throughout the Southwest, including Arizona, Utah and New Mexico, from its home base in Scottsdale, Ariz. Copperwynd’s whole five-advisor team will join Lido, becoming partners at the firm.
The deal will establish Lido offices in Scottsdale and Salt Lake City for the first time. Houlihan Lokey was Copperwynd’s exclusive financial advisor for the deal.
David Daugherty, a former investment banker with Merrill and JPMorgan Chase, co-founded Copperwynd in 2005. He said joining forces will expand his team’s pool of resources to better serve clients.
Lido Advisors was founded in 1999 and offers financial planning, investment management and third-party tax, trust and estate services to more than 4,700 clients. It has approximately 130 advisors and about 40 offices nationwide.
The firm is backed by majority owner Charlesbank Capital Partners, which staked the RIA in 2021. Since then, the firm’s total AUM has grown from $6 billion to $29 billion.
In January 2024, Lido became the third RIA to sell a minority stake to Constellation Wealth Capital, a private equity company founded by former Emigrant Partners CEO Karl Heckenberg.
Constellation has also staked firms such as AITi Tiedemann Global, Perigon Wealth Management andCresset Asset Management. Earlier this month, it made a minority investment in Procyon Partners, a Dynasty-backed Connecticut-based RIA with about $8 billion in assets.
In the wake of the deal, Lido bought Pegasus Partners, a Wisconsin-based RIA managing $3 billion in assets. It also built out its Los Angeles-based business with the acquisition of Avitas Wealth Management, a $1.1 billion firm focusing on multigenerational Hollywood families.
In an interview with WealthManagement.com, Hagenbuch said Lido is seeking out potential sellers with a track record of strong organic growth. He said Lido’s initial success through organic growth, with inorganic growth coming later, means it has a good eye for selecting firms with an organic growth mindset.
“We’re a growth-oriented firm, and we want growth-oriented advisor partners that share that same sentiment,” he said. “We want to check that box right out of the gate. … Then we look at how we can empower (their) abilities to grow in your current markets and beyond.”
However, Hagenbuch said the M&A assessment goes both ways, with strong markets making it a “seller’s market” for quality RIAs. For their part, buyers like Lido have to show they can bring adjacent services such as tax, estate planning, and whatever else the RIA may be seeking to make them an attractive landing spot.
“The continued growth of M&A within our industry has put the onus on the buyers to become more of this comprehensive wealth management offering that can really add real value to the sellers after the fact,” he said.
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