 business owners assume that strong revenue and healthy profit figures are enough to attract a buyer. In practice, buyers look considerably deeper. What they are purchasing is not a snapshot of current performance: it is a stream of future income. How visible, secure and scalable that income is will determine not just whether a deal gets done, but at what multiple.

, explains, "buyers are looking for visibility and scalability from day one." Understanding where businesses fall short is decisive for any owner thinking about a 

Recurring Revenue: The First Metric Buyers Examine

 is the foundation on which valuations are built. Buyers assess it as one of the first indicators of business quality 

Global M&A trends in industrials and services: 2026 outlook

"Anything less than 50% of the total revenue mix will make people feel a little bit uncomfortable," Sykes notes. "Anything north of 65, even 70% of the revenue mix would be seen as highly desirable." A business that has allowed project or one-off revenue to dominate is signalling something about the underlying model.

The percentage alone is not sufficient. The more important question is how that recurring revenue is secured. Businesses relying on goodwill and long-standing relationships, without formal contracts, present buyers with a 

Connecting the dots: M&A deals in technology services in 2024

The absence of robust contracts is one of the most costly oversights Sykes encounters when working with owners preparing for sale.

"The quality of contracts in this sector is absolutely central," he says. Many owners justify the absence of long-term agreements by arguing the service speaks for itself. That may be true, but it misses the point. "You will not convince the buyer to ignore the risk of transitioning ownership of a business," Sykes explains.

The minimum standard is a one-year contract. The strongest businesses go further. "The best and most valuable businesses in this sector take the bolder step to try and extend for three years," Sykes adds. Introducing contracts is rarely as difficult as owners fear, it's never as difficult as they imagine it's going to be. 

The net revenue retention advantage: Driving success in B2B tech

One trap to avoid: contracts with a one-month notice period. "It's meaningless, really. It just defeats the object." Low churn reinforces the picture further. A business on three-year contracts with demonstrably low client turnover presents a materially different risk profile to one relying on informal relationships.

 are another area where businesses frequently disappoint buyers, and the cause is not always obvious.

Building a managed services client base often requires taking on mobilisation and infrastructure projects early in a relationship. These involve significant hardware sales, which carry low margins. Pure support and remote management revenue, by contrast, is very high margin.

"There's a very fine and important balance with an MSP in not doing too much project work at the expense of everything else," Sykes explains 

. A business that has leaned heavily into project delivery may present a margin profile that raises questions about the sustainability of its model. Businesses where recurring support dominates will be in a stronger position.

Driving value creation through M&A in IT services

Customer Base Size and Revenue Concentration

The size of the customer base and how revenue is distributed across it attracts close scrutiny. A business with a small number of clients, where a handful of accounts represent a disproportionate share of revenue, introduces 

 risk that buyers will price into their assessment 

Capturing M&A value: Cost, capital, and revenue synergies

"If a business has a relatively small customer base, then almost inevitably it has high revenue concentration between the top customers," Sykes notes. "That increases the risk for any buyer." The concern is straightforward: the departure of one or two key clients post-acquisition could materially alter the economics of the business purchased. A broad, diversified client base is a clear indicator of resilience and scale.

Owner Dependency: The Factor That Most Often Derails a Sale

Owner dependency is the most common reason businesses fail to achieve the outcome they were expecting.

"Any business owner in this sector who is proud of the fact that they're still the main person in terms of customer interface is going to find themselves short when it comes to actually selling the business," Sykes says.

Buyers want the opposite. "They want to know that there's structured layers of staff within the MSP that will deal with all of those problems, even the big serious ones, and that the business owner doesn't have to get involved," Sykes adds. The simplest test: the business owner should be able to step away for weeks and still have the business running without interruption.

The issue is particularly acute because most IT founders came up through technical roles and remain closely involved, often because they are the best person in the business to do so. From a buyer's perspective, this creates a clear transitional risk: if relationships and knowledge sit with someone about to leave, the business is less robust than it appears.

Internal Processes and Operational Discipline

Buyers will also examine how well the business is run operationally. Well-documented processes and clear systems give acquirers confidence that the business will hold together through a change of ownership. Buyers who see disorganisation in the back-office assume they will inherit it.

Due diligence will surface gaps quickly. The ability to demonstrate clearly how the business operates, without the owner needing to be present, is a signal of genuine institutional value.

How to Prepare: Practical Steps Before Going to Market

"You can't fix any of these things overnight," Sykes says. The businesses that achieve the strongest outcomes have begun building predictable, contracted, scalable revenue stream well in advance. Two to three years is a realistic preparation horizon.

The priorities fall into three areas. First, succession planning: if no one in the business genuinely shares day-to-day accountability, start building that capability now. Second, contract discipline: audit the revenue base, understand what percentage is genuinely recurring, and begin strengthening any weak or missing agreements. "If you're two years out from an intended sale and you've got a lack of contracts in your customer base, start working on that now on a three-year basis," Sykes advises. Third, process documentation: ensure the business can demonstrate its systems clearly to any buyer, on any given day.

"The impact on value that all of them, or to be frank, any of them would have over that period will make it well worth it," Sykes adds. The businesses that achieve the strongest exit outcomes are not the ones that begin thinking about value on the day they decide to sell. They are the ones that have been building for it.

Recurring revenue is the primary valuation driver in the MSP sector:

 Buyers in the IT and managed services space are purchasing a stream of future income, and the percentage of revenue that recurs is the first metric they examine.

Contract quality determines how much that revenue is worth:

 A strong recurring revenue figure means little without solid contracts underpinning it. Businesses with short notice periods or no contracts will struggle to attract serious buyers.

Owner dependency is one of the most common reasons businesses fall short:

 Founders who remain the primary client contact or technical escalation point create a significant transitional risk that buyers will price in, or walk away from.

Gross margins reveal the true health of the business model:

 High project and hardware revenue can inflate turnover while suppressing margins. Buyers look closely at the proportion of high-margin support revenue versus lower-margin project work.

Preparation should begin two to three years before any intended sale:

 Most factors that drive value, contracted revenue, succession planning, documented processes, cannot be fixed quickly. Early planning materially affects exit outcome.

What Buyers Really Look for When Acquiring an IT or Managed Services Business

 are often presented as sophisticated estate planning solutions. In reality, they are best understood as one option among many for families trying to balance growth, control and the gradual transfer of wealth.

Used appropriately, a FIC can play a valuable role in long-term planning. Used indiscriminately, it can introduce cost, complexity and rigidity without delivering proportionate benefit. As with most planning structures, its effectiveness depends less on the mechanics and more on whether it genuinely fits the family’s circumstances 

Family investment companies – how they work

, explains, a family investment company is simply a company structure that has been designed and used for specific 

 purposes. The structure itself is neutral. The outcomes depend entirely on how and why it is used.

 vehicles. More recently, they have gained prominence as alternatives to 

. That visibility has been helpful, but it has also encouraged the idea that the structure itself is the solution, rather than a tool that must earn its place.

Why Families Consider Family Investment Companies

The starting point for a FIC should never be 

 alone. By the time a company structure is appropriate, families have usually reached a clear conclusion that some assets will never be required to support their own lifestyle.

“There’s typically been quite a lot of advice given” before a FIC is set up, Gareth notes. Detailed cashflow modelling is normally required to establish whether assets are genuinely surplus. Without that work, families 

 transferring capital into a structure that later proves restrictive, expensive or difficult to unwind.

Where surplus assets are clearly identified, the attraction is understandable. Assets can be moved out of the estate, with future growth falling outside the inheritance tax net immediately, while the 

How can a Family Investment Company help reduce inheritance tax?

However, that benefit only matters where 

 is a material issue. For many families, estates are either too small for the tax saving to justify the structure, or sufficiently dynamic that locking assets away introduces more risk than reward.

Freezing Wealth and Accepting the Trade-Offs

FICs are often described as a way of “freezing” wealth. The intention is not to limit investment growth, but to prevent future growth from compounding the inheritance tax problem.

In practical terms, once surplus assets are transferred, any future growth on those assets falls outside the estate immediately, even though the original value remains relevant for inheritance tax during the seven-year period. This can stabilise the value of what remains taxable while allowing wealth to build elsewhere.

In practice, freezing wealth also freezes flexibility. Capital placed into a company structure is no longer readily available to meet changing needs, opportunities or unforeseen costs. That loss of optionality is often underappreciated at the outset, particularly where future spending, health or family circumstances are uncertain.

For families whose financial position is still evolving, this rigidity can outweigh the tax advantage the structure was designed to achieve.

One of the defining features of a FIC is the separation of economic benefit from control. Beneficiaries can be entitled to future growth without holding voting rights or accessing assets directly.

This is particularly appealing where families want to begin inheritance tax planning but are concerned about timing. “They want to get the assets outside of their estate,” Gareth explains, “but they maybe don’t want the beneficiary to be able to control or have any access to that asset.”

That concern is often well founded. Significant wealth transferred too early can distort incentives, reduce motivation or expose beneficiaries to risks they are not yet equipped to manage 

Family Investment Companies Unpacked: Corporate Tax and Accounting Explained

The trade-off is administration. Company structures require accounts, filings, professional advice and ongoing governance. They are more expensive and time-consuming than outright ownership, and those costs persist regardless of investment performance.

Family Investment Companies Compared With Trusts

Family investment companies are frequently compared with trusts, and in many respects they perform a similar function. Both can remove assets from an estate while preserving a degree of control.

The differences lie primarily in taxation and long-term flexibility. Trusts can trigger immediate inheritance tax charges on funding and periodic charges thereafter. For larger sums, those charges can be prohibitive. As Gareth notes, “for somebody who wants to put £10 million into a trust… they have to pay £2 million to get the money in there.”

FICs avoid those upfront and periodic inheritance tax charges, which explains their growing popularity for substantial estates.

Trusts, however, offer advantages that companies do not. They allow for classes of beneficiaries rather than named individuals, which can make them more adaptable as families grow and circumstances change. Over longer time horizons, that flexibility can be valuable 

Trusts and taxes: overview

Neither structure is inherently superior. The right choice depends on scale, complexity, family dynamics and the level of ongoing engagement the family is prepared to maintain.

One of the most common problems with FICs is that they are sometimes used because they are available, rather than because they are necessary.

Company structures are more complex than holding assets outright and harder to unwind once established. Gareth has seen situations where families received good initial advice but limited follow-up, leaving adult children constrained by arrangements that no longer serve a clear purpose.

At that point, families face an uncomfortable choice: accept ongoing cost and friction, or unwind structures that were intended to be helpful but have outlived their usefulness.

For this reason, FICs work best where there is a clear rationale for delay and a shared understanding of what will eventually change 

Family Investment Companies

A FIC can support estate planning, but it cannot replace financial education. As Gareth puts it, the structure “doesn’t solve the problem of needing to educate the next generation on wealth.”

At some point, control will pass. When it does, beneficiaries need the skills, judgement and confidence to manage what they receive. A company structure can buy time, but it does not remove that responsibility.

As Gareth notes, a FIC, like a trust or even a JISA for a younger child, can help engage the next generation in wealth and legal discussions “without them being able to physically access the money and run off down the Porsche garage.”

Family investment companies can be effective in the right circumstances. They can reduce inheritance tax exposure, protect future growth and help families manage the transition of wealth across generations.

But they are not a default solution. They are expensive to run, time-consuming to manage and inflexible once in place. For many families, simpler approaches deliver better outcomes with fewer compromises 

Wealth managers issue ‘health warning’ over inheritance tax vehicles

The real value of a FIC lies not in its technical features, but in the discipline it enforces: clarity on what is surplus, realism about control, and a willingness to plan for responsibility, not just tax.

Family investment companies are not one-size-fits-all.

 A FIC can support estate planning and wealth protection, but only where assets are genuinely surplus and long-term complexity is justified.

Tax benefits rely on integrated planning.

 Inheritance tax efficiency comes from aligning a FIC with wider business exit planning or post-sale strategy, not from using the structure in isolation.

Control comes with cost and responsibility.

 FICs offer oversight of wealth transfer, but they are expensive to run, time-consuming to manage and require ongoing professional advice.

Flexibility is reduced once assets are transferred.

 Freezing wealth inside a FIC can limit access to capital, which may create issues after selling your business in the UK or if circumstances change.

 A FIC can delay access to capital and support long-term planning, but successful wealth protection still depends on preparing the next generation.

What Is a Family Investment Company and Is One Right for You?

 and felt overwhelmed by the sheer number of options? Do you know what they offer and whether they align with your financial goals?

Choosing a wealth manager best suited to your needs is just as crucial as financial planning itself. Each firm has its own unique approach, philosophy, and expertise, tailored to different client needs. At Compare Wealth Managers, we recognise the vital role a skilled financial planner can play in securing your future. That’s why we’ve compiled a list of our top UK wealth management firms, highlighting their key strengths and what sets them apart. Discover which one aligns bestwithyourfinancialaspirations.

A good wealth manager combines technical expertise with the ability to deliver client-focused advice. They must understand 

, and portfolio construction, and then integrate these elements into a coherent strategy tailored to each client’s circumstances 

What is a Private Wealth Manager?

Equally important are communication and trust. The best wealth managers listen carefully to their clients, explain complex ideas in straightforward language, and build long-term relationships that extend across generations. This ability to foster confidence and clarity helps clients remain committed to their strategies through different market cycles 

How to choose a wealth manager

Transparency and accountability are also critical. A good wealth manager is clear about fees, explains how investment decisions are made, and ensures that all actions align with the client’s stated goals and 

 tolerance. Strong governance and ethical standards underpin this approach, giving clients the confidence that their interests always come first 

Dear CEO letter: FCA expectations of wealth management and stockbroking firms.

Finally, leading wealth managers offer a clear value proposition. They provide services that are designed for the specific needs of their target clients, whether that is high-net-worth families, 

, or institutional investors. This specialisation allows them to deliver bespoke planning, tailored portfolios, and innovative solutions such as sustainable investing or access to private markets 

Five Keys to Consistent Success in Wealth Management

For investors with £500,000 to £25 million in investable assets, wealth management rankings provide a valuable benchmark. They allow you to compare firms not only on assets under management (AUM) and scale, but also on reputation, service quality, and investment approach. Rankings highlight which firms are best equipped to manage complex portfolios, which specialise in bespoke advice, and how each positions itself within the competitive UK market. As the 

 notes, wealth managers increasingly compete on scale, reputation and client differentiation, underscoring why rankings offer meaningful context to investors 

Wall Street is racing to manage your wealth. That is a good thing.

How to Use Wealth Management Rankings Effectively

Wealth management rankings should be used as a guide to narrow the field, not as a definitive verdict. They provide an objective way to compare firms on scale, reputation, and service quality, helping investors identify which are best suited to complex portfolios or bespoke advice. The key is to align these insights with your personal goals, ensuring that the firms you consider reflect your risk appetite, investment horizon, and long-term priorities.

If you need support finding the right wealth manager, Compare Wealth Managers offers a free service to help you find a wealth advisor/manager suited to your needs. Simply click the orange "

" button to get started and check out our 5* reviews from Trustpilot.

 – Firms such as James Hambro & Partners, Saltus, and Evelyn Partners feature among the best wealth managers UK, recognised for strong client service and consistent portfolio results.

 – The leading wealth management firms collectively oversee significant AUM, demonstrating financial strength, resilience, and the scale to support high-net-worth clients.

 – Top firms provide bespoke strategies across investment management, tax planning, and estate structuring to help clients protect and grow wealth across generations.

 – Many of the best wealth managers combine international investment expertise with local insight, offering diversified opportunities across markets.

 – Established names in the rankings are known for long-standing reputations, governance standards, and multi-generational relationships with clients.

 – The top wealth management firms in London and across the UK integrate ESG, alternatives, and diversified portfolios to deliver sustainable long-term growth.

This article ranks the top ten wealth management firms in the UK in 2025, highlighting their scale, client service, and long-term expertise.

The ranking compares firms across assets under management, minimum investment requirements, and bespoke services, offering investors insight into the diversity and strengths of the UK wealth management industry.
Compare Wealth Managers

It reflects strategies focused on integrated financial planning, personalised investment advice, and the ability to balance global capabilities with local market knowledge.
Compare Wealth Managers

The article is not about finding a single “best” firm, but about providing context on how leading wealth managers operate — a useful benchmark when selecting the right partner for your wealth.

Top Ten Wealth Management Firms in the UK

Client services director at Compare Wealth Managers.

Paul Dredge

Bio

Articles from author

What Buyers Really Look for When Acquiring an IT or Managed Services Business

What Is a Family Investment Company and Is One Right for You?

Top Ten Wealth Management Firms in the UK

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Financial well-being

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Paul Dredge

Bio

Articles from author

What Buyers Really Look for When Acquiring an IT or Managed Services Business

What Is a Family Investment Company and Is One Right for You?

Top Ten Wealth Management Firms in the UK

Start your journey to your Financial well-being

FIND OUT MORE

LEGAL

CONTACT US

Start your journey to your
Financial well-being