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Atlanta’s OneDigital has made its first foray into the Canadian market with a purchase of Montreal-based PWL Capital, a wealth advisory firm with C$5.5 billion (just under $4 billion) in assets under management.
PWL, which has more than 70 team members across offices in Ottawa, Toronto and Montreal, will take the OneDigital Canada name but will continue to operate as a subsidiary.
The terms of the deal were not disclosed, but OneDigital reportedly bought 100 percent of PWL in a deal executives at the Canadian firm say was undertaken with the goal of maintaining as much independence as possible.
Both firms talked up their cultural complementarity and shared focus on exceptional client service with low fees.
Founded in 1996, PWL has built a younger-than-average clientele comprising more than 2,300 households, served by advisors who also trend younger than the industry average. Its “Rational Reminder” podcast and YouTube channel boasts tens of thousands of subscribers, helping PWL establish itself as a trusted voice by demystifying wealth management. An influx of tech entrepreneurs, particularly employees of Toronto-based e-commerce platform Shopify, helped fuel PWL’s above-market performance, the Toronto Globe and Mail reported.
OneDigital, meanwhile, got its start as an insurance and benefits broker, in 2000 and later adding a registered investment advisor business. The larger company, based in Cobb County, directly manages $16 billion in assets, and has grown via more than 200 acquisitions since its founding.
In a conversation with PWL CEO Cameron Passmore on the podcast, OneDigital co-founder Mike Sullivan said that through hours of conversation, the firms realized they were “almost mirror of each other from a cultural standpoint,” from the way both companies cultivate employees to how their advisors view their roles as fiduciaries.
That shared focus will help OneDigital avoid pitfalls upon expanding into a new country, Mr. Sullivan said, but it will also build on PWL’s positioning to create a differentiated offering throughout Canada.
“It took us some time to realize that culture is the No. 1, No. 2 and No. 3 thing,” Mr. Sullivan said in the podcast with PWL. “You’re basically a proxy for OneDigital in the marketplace, and you’re going to lead in terms of where we go have additional conversations, but I do believe that we have a deep understanding of scaling businesses, and I think we’re going to lead from a technology development and AI standpoint.”
Mr. Sullivan hinted a more acquisitions to come as OneDigital brings more capital to the table.
“We want like-minded teams in Canada to understand we are open for business we are going to build something significant in the marketplace together that we don’t think exists in Canada today, so done the right way we create a gravitational pull of teams and talent to your organization,” Mr. Sullivan said, which in turn, he added, should be followed by more clients.
OneDigital investing in Canada in a way is a homecoming — at least for the capital deployed.
Toronto-based Onex, a private-equity fund, acquired a majority stake in OneDigital in a $960 million investment that valued the company at $2.65 billion. OneDigital, the trademarked brand of Digital Insurance LLC, serves 75,000 employers and 13,000 households across more than 200 offices. This is the firm’s first international venture.