Kestra is a leading national wealth management platform supporting more than 2,400 independent financial advisors in delivering comprehensive financial planning and investment services to their clients.
Kestra Financial empowers independent financial professionals, including traditional and hybrid registered investment advisors, to provide superior client service.
Kestra (formerly known as NFP Advisor Services) was initially formed in 2000 within National Financial Partners (NFP) to provide the company’s insurance brokers with a broker-dealer platform to enable them to sell investment securities. As the business grew, it began to service independent financial advisors outside of NFP, evolving into a national wealth management platform with over 1,700 advisors and $114 billion of assets under advisement. NFP and Kestra management came to the conclusion that the business was non-core to NFP’s legacy insurance brokerage operations and were looking for a partner to support the business through its spinout from the parent and invest in the platform and team in order to help the company continue to scale and grow. In June 2016, Stone Point completed a recapitalization of the business, becoming the company’s new majority shareholder, with NFP and management retaining a significant minority equity stake. NFP and Kestra management opted to work with Stone Point on this transaction given our significant experience within the wealth management space as well as our expertise in supporting portfolio companies through additional capital and support for tuck-in acquisitions. In 2019, Stone Point and NFP sold a majority interest in the business to funds managed by Warburg Pincus, with Stone Point retaining a minority equity position and holding a seat on the company’s board.
INDUSTRY KNOWLEDGE & NETWORK
Stone Point leveraged its deep network within asset and wealth management to make several strategic introductions to Kestra, including leading asset managers, technology vendors and key industry executives. Stone Point supported the business through its rebranding from NFP Advisor Services into Kestra and was helpful in crafting the go-forward marketing strategy in order to position Kestra within the industry as a differentiated platform with a focus on a high quality, highly productive advisors.
OPERATIONAL ASSISTANCE & GOVERNANCE
Stone Point supported Kestra as it made significant technological improvements to its platform. This helped cement Kestra’s position as a market leader for the industry’s most productive advisors and turned the company’s technology into a key competitive advantage when recruiting new advisors. In addition, Stone Point helped Kestra build a best-in-class investment platform supported by centralized due-diligence specialists and third-party partners, hired a dedicated head of retirement services, and added trust services to Kestra’s offerings through an acquisition.
Stone Point worked with Kestra to develop a multi-pronged M&A effort and establish an acquisition platform. Stone Point helped Kestra source and execute 23 acquisitions, which has expanded Kestra’s market presence in key services and helped increase the company’s EBITDA by ~300% since the time of Stone Point’s initial investment.
EXECUTIVE RECRUITING & ALIGNMENT
Following the spinout from NFP, Stone Point assisted Kestra with the recruitment of an experienced CFO and as well as an operations leader. Stone Point also helped Kestra expand its recruiting team and started an internal sales desk to further lead generation.
CAPITAL RAISING & STRUCTURING
Stone Point facilitated all of the company’s third-party debt financings, which have been critical in the company’s ability to successfully execute on its M&A strategy. Stone Point also led a minority recapitalization with a longstanding Stone Point relationship that resulted in liquidity for both management and Trident while strengthening the company’s equity base and access to additional capital.