Independent Sponsor Management Incentive Plans (MIP) in Wealth Advisors & RIAs
Independent sponsor counsel for wealth advisors and RIAs, focused on Management Incentive Plans (MIP) and the deal mechanics that protect sponsor economics and LP alignment.
The economics on a wealth advisors and RIAs platform deal usually hinge on a handful of structural decisions. Management Incentive Plans (MIP) is one of them.
The typical wealth advisors and RIAs platform sits at $10M to $180M EV with EBITDA in the $3M to $25M range. The thesis runs on RIA aggregation or wealth platform roll-up. Client consent process is the longest pole. Start it the day after the LOI signs.
How Management Incentive Plans (MIP) actually gets structured.
Size the MIP at 10 to 15 percent of post-close equity, with 60 percent time-vested and 40 percent performance-vested.
Use profits interests for tax efficiency, with a clear strike value at grant.
Build double-trigger acceleration on change of control plus termination.
Document the MIP in the LLC operating agreement, not in a separate plan only.
In wealth advisors and RIAs, layer in negative consent process timed with regulators as part of the Management Incentive Plans (MIP) workstream.
Promising the MIP percentage in the LOI without modeling the impact on the LP waterfall. The LP finds out and the deal stalls.
"MIPs are the cheapest retention tool you have. Use them deliberately, document them precisely."Jason Powell · Management Incentive Plans (MIP)
The deal is one thing. The capital that opens up after close is another.
Capital after close is where the IRR actually gets made. The right introductions at month nine through month thirty are where this practice works as hard as it does at the LOI.
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Bring the wealth advisors and RIAs deal. Get Management Incentive Plans (MIP) done right.
Direct counsel from a securities and M&A attorney with billions in structured transactions, the independent-sponsor-native playbook, and the capital markets network that opens up post-close.