Radar’s six monthly price guide

An indication of prices as at January 2015


Revenue Type Recurring Revenue multiple
Investment and super clients (age 75 yrs+) 1.0x to 1.5x
Investment and super clients (age 65-74 yrs) 2.0x to 2.5x
Investment and super clients (age 30-64 yrs) 2.5x to 3.5x
Investment clients on Platforms with ‘high’ MERs# Up to 4.0x
Risk clients (age under 50 years) 3.0x to 4.0x
Corporate super clients 0.5x to 1.0x
Cs and Ds (investment and risk) 2.0x to 2.5x
General insurance 2.0x to 2.2x
Mortgage clients 2.0x to 2.5x
Accounting fees – Fees on non-business clients ie individual returns, is generally lower 0.3x to 0.6x 0.9x to 1.2x


The multiples above can vary depending on the terms offered by the vendor, actual location of the clients, client ages and the particular investment products recommended. In relation to multiples paid for risk books or insurance-revenue based practices, the client’s occupation, premium size, policy type and insurance companies used are all critical factors. The multiples displayed above are for high-quality risk clients. # Management Expense Ratios (MER) can vary from platform to platform, however, 2% per annum before adding buy/sell spreads and adviser fees would be considered ‘high’.   

The table above is based on market activity over the past six months to 31 January 2015.

The multiple of recurring revenue paid for a financial planning register can vary depending on terms offered by the vendor, location of the clients, age of the clients and the investment products which had been used previously.

The multiple paid for risk books will vary depending on the size of the sum assured, the premium and how it’s paid, the insurance company (product provider), whether the insurance is hybrid (combination of stepped and level premiums) and whether the insurance commission accepted by the adviser was all paid up-front.

The multiple paid for mortgage book trails will vary according to the size of each loan, the occupation of the borrower, whether the loans were written as variable or fixed, age of each loan and who’s the aggregator.

The multiple paid for a general insurance register depends on the level of domestic insurances compared with commercial insurance. Domestic includes car, house and contents insurance. Commercial would include office buildings, PI insurance, business insurance packages, including public liability. Commercial insurance attracts a higher multiple and the location of the business also plays a role.

Multiples paid for accounting businesses have risen once again and the demand is higher than ever. Not only do accounting practices wish to buy or merge with other accounting practices, but financial planners are also buying into these businesses. Business accounting fees, as compared to individual return fees, are in high demand and can command a higher multiple. The selling of country and regional practices can take a lot longer due to the limited number of buyers in those areas and they tend to sell for a lower multiple than city-based practices.

I’ve added an additional sector, ‘Investment clients on platforms with high Management Expense Ratios (MERs). So, what’s a high MER? Tony Blythe, Relationship and Training Manager for boutique licensee HNW Planning, suggests that before you add buy/sell spreads and adviser fees, some platforms can have a MER of up to 2% per annum. These platforms can sell for up to four times their recurring revenue (RR). The purchasing adviser can move the client’s investment to a lower priced platform, and at the same time increase the adviser fee commensurate with the service they are providing. Overall, this can save the client up to 1.5% per annum.