Achieve a Higher Valuation for Your Company: The Strategic Power of Model-Based Advisory Practices

Every financial advisory firm dreams of building a business that’s not only successful today—but also worth significantly more tomorrow. Whether planning for succession, sale, or partnership, the question remains: how do you boost the enterprise value of your firm?

The answer lies in systems. More specifically, in the repeatable, scalable, and transferable systems that make your business more than just a book of business. Among these, managed model portfolios (MMPs) stand out as one of the most effective tools to increase firm valuation.

At Equity Partners, we work with advisors who want more than incremental growth—they want transformation. And model portfolios are at the heart of that strategy.

What Buyers and Investors Look For

Firms with higher valuations share several traits:

• Consistent revenue with minimal volatility
• Standardized investment processes
• Low client attrition risk
• Strong EBITDA margins
• Clear succession planning

MMPs contribute to each of these factors by turning the firm’s investment strategy into a consistent, measurable, and manageable process.

From Practice to Platform

Many advisory businesses operate like personalized practices—highly dependent on individual advisors for investment selection, client management, and business growth.

While this may work for a time, it limits valuation. In contrast, firms using managed models operate like platforms. They:

• Scale easily
• Delegate portfolio management
• Train staff around systems, not individuals

This transition from practice to platform is what investors reward.

The Margin Multiplier

One of the greatest hidden advantages of managed portfolios is their impact on operating margins:

• Reduced trading errors and costs
• Less time spent on research and rebalancing
• Streamlined compliance workflows

These efficiencies boost EBITDA—a primary metric in valuation calculations. For every 1% improvement in margin, valuation multiples typically increase.

Ron Robertson of Equity Partners says, “If you want buyers to see your business as a system they can scale, not a set of relationships they might lose—start using models.”

Valuation Through the Lens of Predictability

Buyers value predictability above all. They want to know that:

• Portfolios can be managed consistently without the founder
• Client experience won’t drop after a transition
• The firm has a proven system, not just a good reputation

MMPs provide this confidence. They signal:

• Less reliance on personality
• More reliance on process
• Lower transition risk

That’s the foundation for a premium multiple.

Creating Transferable Value

Valuation also depends on how easily the firm’s processes can be transferred. Custom portfolios, handwritten IPS documents, and one-off investment strategies are difficult to pass on.

By contrast, firms that use managed model portfolios:

• Document and centralize their investment process
• Create workflows that are easy to train and adopt
• Build firms that live beyond the founder

Whether your exit is near or far, that’s the kind of value that lasts.

Key Steps to Increase Valuation with MMPs

1. Systematize Investment Philosophy: Choose or build model portfolios that reflect your core beliefs.
2. Adopt Across Clients: Move toward firm-wide implementation where appropriate.
3. Build a Repeatable Experience: Ensure client onboarding, reviews, and reports are uniform.
4. Track Key Metrics: Monitor cost-to-serve, revenue per client, and margin improvements.

Each step builds valuation capital that accumulates year over year.

Equity Partners: Your Valuation Growth Partner

We specialize in helping advisory firms evolve from founder-led practices into scalable platforms. With the right model portfolio strategies and operational support, you can:

• Grow faster
• Serve better
• Exit stronger

Whether you’re looking to grow, merge, or transition to the next generation, Equity Partners is here to help.

Model portfolios aren’t just an investment strategy—they’re a business valuation strategy. Let’s build a more valuable firm together.