Summit Financial, a Parsippany, N.J.–based registered investment advisor backed by Merchant Investment Management and overseeing around $9 billion in client assets, has made a non-controlling, minority investment in Prostatis Financial Advisors Group—a Baltimore-based firm owned by “The Savvy Investor.”
Representing Summit’s fifth strategic investment of the year, Prostatis manages approximately $310 million and is joining under a minority investment model launched three years ago, Summit Growth Partners. Majority owned by Michael Canet, who founded Prostatis in 2003, the firm will remain on its own ADV at this time.
Canet is also the host of The Savvy Investor radio show. Established in 2011, it airs weekends on WJZ 105.7 The Fan in Baltimore and on a nationally syndicated podcast.
“Mike is not only known for his podcast, but he has also been a coach to a lot of advisors over the years,” said Ed Friedman, Summit’s director of business development and growth. ‘He has a strong reputation in those circles and a lot of those firms that he’s worked with have reached out to us to join the partnership as well.”
With five offices in Maryland and Florida, Prostatis provides tax-efficient asset management, holistic financial planning and consultation for affluent households, qualified investors, businesses and retirement plan sponsors, as well as insurance-based risk management solutions. The firm was introduced to Summit through an associate who knew Canet was looking for a minority partner.
"It quickly became evident that joining Summit Growth Partners would accelerate Prostatis’ growth, both in terms of improving service for our existing clients and in helping us acquire new ones,” Canet said in a statement.
The SGP partnership model combines cash and equity, along with a variety of exclusive services, such as access to certain alternative investments, tax attorneys and an in-house planning department. Laser-focused on firms seeking growth, the invite-only model also includes additional capital made available through Summit’s balance sheet and the Merchant partnership.
"The Merchant team looks forward to the continued partnership and collaboration with both Summit and Prostasis," said Merchant Managing Partner Rick D'Amico.
Summit currently manages around $6.2 billion in advisory assets and advises on another $2.8 billion in brokerage assets through a partnership with Purshe Kaplan Sterling. About half of Summit’s 21 partner firms include breakaways, while the other half were independent RIAs in need of resources and scale.
Earlier this year, Summit CEO Stan Gregor said the firm was working to add Goldman Sachs and First Clearing alongside Fidelity, Schwab and Pershing as custodians.
Summit expects to announce no less than three new additions before next year, said Friedman, and has up to six in the pipeline for the first quarter of 2024.
“We don't have a stated goal with respect to number of advisors or AUM or anything along those lines,” he said. “It’s great to set goals, but sometimes those goals drive your process as opposed to your process driving the transactions, and we want to be sure we’re doing the right type of transactions with the right type of people. And you want to be able to say no to those that need to be said no to.
“I will tell you that our pipeline is probably the best that I've seen in the 3 1/2 years that I've been here,” he noted. “And 2024, certainly, will become a banner year for us.”