True Potential has sold a majority stake to private equity house Cinven to facilitate continued business growth and platform development. The company said it had a “highly scalable business model”, having built a bespoke and proprietary technology platform to serve both financial advisers and clients.
True Potential, headquartered in Newcastle, was founded in 2007 by father and son chairman David Harrison and chief executive Daniel Harrison. It operates across wealth management providing advice, an investment platform and fund management to more than 1.4 million retail clients. The business employs more than 350 people and works with about 800 restricted advisers. About 20% of the financial adviser market in the UK uses True Potential’s technology and support services, the firm said.
True Potential is expected to have in excess of £20bn of assets under management (AUM) and to generate c. £135m of EBITDA for the year ending 31 December 2021, “reflecting the company’s strong growth over the past five years, during which time AUM and EBITDA have grown at CAGRs of more than 30% and more than 40%, respectively”.
David Harrison said: “We identified Cinven as the right partner for True Potential’s next phase of growth due to its financial services and TMT expertise. Its investment will enable us to continue to deliver on our mission to revolutionise the way wealth management is provided. We have a shared vision and I am certain that this investment in True Potential alongside the existing management expertise will deliver continued growth for many years to come.”
