An indication of prices as at June 2014:


Revenue Type Multiple of Recurring Revenue
Investment and super clients aged 75 yrs+ 1.0x to 1.5x
Investment and super clients aged 65-75 yrs 2.0x to 2.5x
Investment and super clients aged 30-64 yrs 2.5x to 3.0x
Risk clients (average age under 50 years) 3.0x to 3.8x
Corporate super clients (down from 0.5x to 1.0x) 0.0x to 1.0x
Cs and Ds (investment and risk) 1.5x to 2.5x
General insurance 1.5. to 2.0x
Mortgage clients (up from 1.5x to 1.9x) 1.7x to 2.2x
Accounting fees 0.8x 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. The multiples displayed above are for high-quality risk clients.

The above table is based on market activity over the past six months to 30 May 2014. The multiples above can vary depending on terms offered by the vendor, location of clients, age of clients and the recommended investment products. I’ve added an additional sector, ‘Investment and super clients aged 75 or over,’ which would include annuity products and allocated pension clients. This is not a high demand area and price multiples seem to constantly remain low. Unlike the 1980’S to 1990’s when there were better health and living conditions, and the average redundancy age was 53, clients are now living longer and the ‘older’ financial planners now retiring often have a large component of clients of similar age.    

Since November 2013, change in the price range has been evident in only two sectors. The price multiple for corporate super clients continues to fall due to the Government’s MySuper product, which will be fully implemented within two years.

The multiple for trails on mortgage clients has increased due to the demand for this style of client by buyers and the cross-selling opportunity associated with younger clients. 

When a practice with a total revenue of at least $1M is up for sale an EBIT multiple may be applied to its valuation rather than a multiple of recurring revenue, which is displayed in the above table.  Commonly, EBIT multiples range between four times and six times depending on the quality and location of the business.

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