US firm backs Koda CapitalBY JAMIE WILLIAMSON | THURSDAY, 12 MAY 2022 12:28PM
Read more: Koda Capital, Emigrant Partners, Steve Tucker, Howard Milstein, Forbes, Karl Heckenberg, Paul Heath
The private wealth manager has sold a minority stake to Emigrant Partners as part of a broader strategy that will see Koda Capital make its own acquisitions.
Emigrant Partners is now a minority strategic investor in the HNW firm, adding Koda Capital to its portfolio of more than 18 firms in which it holds non-voting interests.
Emigrant Partners is a New York-based subsidiary of Howard Milstein's New York Private Bank and Trust; the Milstein family was listed by Forbes in 2015 as the 90th richest family in the US.
Under the deal, Emigrant will provide strategic and operational support to help Koda Capital grow, including financial adviser acquisition strategy and funding, wealth advice market insights and professional development resources. It is also providing growth capital for Koda to make its own acquisitions, and also funding structures for equity recycling to support new equity partners joining the firm.
Koda's founders Steve Tucker and Paul Heath will continue to own more than 75% of the business alongside its staff.
"Over the last seven years we have established Koda as a leading independent wealth advisory business, owned by its people and free from the conflicts of interest that come with vertical integration," Tucker said.
"Koda's independent advice model has enabled us to provide a compelling offer to clients, grow client funds to scale and deliver strong revenue and earnings growth over the last five years."
The investment is the outcome of a strategic review process undertaken to identify a partner that would support future growth and wouldn't sacrifice Koda's independence.
"With the growing number and wealth of Australians seeking truly independent financial advice, we see an opportunity to double in scale over the next five years," Tucker added.
Emigrant Partners chief executive Karl Heckenberg said the firm is excited by the deal, which is its first investment outside of the US.
"Koda has successfully established a high-quality independent advice business in the large and growing wealth market in Australia - a market that we see as very attractive," he said.
"Our minority investments in employee-owned, founder-led firms enable our partner firms to continue to grow while maintaining a culture of trust, ownership and service excellence that draws top-tier client and advisers to their firms."
Founded in 2015, Koda Capital has 39 partners and 28 financial advisers, overseeing more than $10 billion in client funds.
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