Is Dynasty Financial Partners Inc. IPO A Good Buy?

Though the do-it-yourself industry represents a multi-billion-dollar ecosystem, the massive dollar amount hides a central irony. While people can save some cash performing desired endeavors on their own, money is a multi-dimensional concept. In other words…

excessive time expenditures can easily create economic inefficiencies.

And that’s the central premise behind Dynasty Financial Partners Inc., essentially an administrative accelerant for independent wealth managers. Sometimes, it’s better to let the experts handle specific concerns, although the unique headwinds of the new normal present serious challenges that you shouldn’t ignore.

What Does Dynasty Financial Partners Do?

Founded in 2010, Dynasty Financial Partners specializes in supporting financial advisors in setting up and operating independent wealth management firms. Primarily, the company’s core business involves providing middle-office (transaction processing) and back-office support roles. This segment was responsible for slightly over half the total revenue that Dynasty generated in 2020.

Today, the brand is perhaps best associated with its “wealthtech” platform or the integration of wealth management strategies with the latest technologies. As Dynasty’s website claims, its mission is to unlock the potential for independent advisors to branch out on their own, thus providing a custom-made solution for their clients.

To accomplish this task, Dynasty cuts the learning curve for entrepreneurs in the wealth management segment, offering myriad proprietary software and technology platforms to accelerate progress — ultimately guiding individual clients to financial success.

When is the Dynasty Financial Partners IPO Date?

After a scorching heat wave of new listings over the trailing two years, 2022 was almost inevitably due for a healthy correction. As with anything in life, excessive exuberance is not an indefinitely sustainable endeavor. However, after a choppy month in January, companies appear more interested in launching an initial public offering (IPO), or the first time a private enterprise distributes its equity shares to retail investors.

In Dynasty Financial Partners’ case, management filed a Form S-1 (colloquially known as an IPO prospectus) with the U.S. Securities and Exchange Commission (SEC) on Jan. 19, 2022. Under the terms of the deal, the wealthtech firm will be looking to raise up to $100 million. Likely, this figure is a temporary placeholder, with the demand profile for the offering poised to modulate it.

At the time of writing, no per-share data for the IPO was available. As well, management has not yet provided a firm date for inclusion into the IPO calendar. However, Dynasty disclosed that it was seeking to list on the Nasdaq exchange under the ticker symbol DSTY. Goldman Sachs Group Inc. (NYSE: GS), JPMorgan Chase & Co. (NYSE: JPM), Citigroup Inc. (NYSE: C) and Royal Bank of Canada (NYSE: RY) represent the joint bookrunners for the deal.

An intriguing idea among upcoming new listings, DSTY stock also finds itself in an awkward situation. Mainly, the surrounding circumstances that have caused much volatility in global capital markets — including for risk-on subsegments like IPOs — are also the possible upside catalyst for Dynasty’s core business model.

A famous adage states that “you make most of your money in a bear market; you just don’t realize it at the time.” Theoretically, then, the downturn presents an excellent opportunity for financial advisors seeking to set up their own independent wealth management firms. Fortuitously as well, those who sat on the sidelines during the spring doldrums of 2020 have seen with their own eyes how lack of participation could yield deep regrets.



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