Disclaimer: Unless noted otherwise, views and analysis expressed here are the author's own and based on public sources. The article is intended for informational and entertainment purposes only. This is not financial advice. Please consult a professional for investment decisions.

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Two summers ago, we wrote about an obscure wealth manager in the North of England called True Potential (TP). You guys loved the writeup! Founded in 2007 by a former builder David Harrison, TP might well be Britain’s, if not Europe’s, most prolific financial services compounder. Between 2008 and 2025, TP’s gross revenues surged from less than £3M to £525M, and EBITDA from £1.4M to £266M - a stunning CAGR of 36%: 

TP’s extraordinary growth recipe comprised 3 ingredients:

TP’s integrationist modus operandi is however atypical. 

Mainstream UK wealth consolidators acquire advice firms and run them on third-party custody platforms with third-party or semi-outsourced “product” funds. It’s not a stretch to say that TP was an “AI rollup” years before the term appeared. It was valued as such, too. The US growth equity investor FTV took a 27% stake in 2016, valuing the firm at £150M. In 2018, TP came close to selling itself to KKR. According to Companies House, the following year, it bought back two-thirds of FTV’s stake (18.5%)… before flipping the entire firm to Cinven in early 2022, for £2.6B (18x EBITDA). 

4.5 years later, how’s it going, True Potential? On the face of it, still amazingly well. 

According to investor reports, on a run-rate basis, the business is generating c.£560M ($760M) in gross revenue and c.£280M ($380M) in adjusted EBITDA. Between 2021 and 2025, AuM, revenue and EBITDA all grew by more than 80% cumulatively. Cash conversion remains robust. The ratio of net debt to EBITDA has fallen from 4x to sub-3x. 

But look closer, and you will notice the sharp deceleration in the last two years. Gross inflows have halved, while net inflows (excluding withdrawals) are down by 85%. Accordingly, revenue growth has slowed to a crawl (+3% in 2025). 

What’s going on?    

Turns out, TP’s mercurial dealmakers had to be reined in, after an intervention by the UK’s Financial Conduct Authority (FCA). Specifically, in 2024, TP “worked with the FCA and a skilled person to deal with issues related to historic client onboarding practices, as well as completing an assessment on the adequacy of client investment reviews” (source: TP 2024 annual report). 

Wait, what issues? Read on to learn about:

But first, so there are no regrets later…

One, If Autumn 2026 is the time you finally want to get going on your serial acquirer - and could do with some help and momentum - sign up to our Rollup Bootcamp starting on 23 September.

Two, if you haven’t got your ticket to the 4 September Serial Acquirer Summit… Hurry! Only 40 seats left. When they’re gone, they’re gone. Full agenda + registration link. See you in London in a month’s time?

Lots going on, we know. But who doesn’t love a good spike of activity after the summer lull!

Ok, back to this week’s story…

Historically, about half of TP’s gross inflows has been M&A-related. Crucially, the firm has eschewed large, complex share deals in favour of smallish asset deals - buying books of business from advisers. 

Between 2018 and 2024, TP operated a two-tier scheme. Advisers willing to hang up the boots were offered payments of 8% of AuM, provided they were able to complete the transfer within 6 months. No mean feat considering that everything - the product and the platform included - had to be switched over. By comparison, advisers that wanted to stay received only 2%. In both cases, the advisers were supposed to be merely forwarding TP’s direct offer to a client - as opposed to explicitly endorsing it. That way, at least in theory, both parties would be shielded from liability.  

And in practice? 

A complaint lodged with the UK’s Financial Ombudsman Service (FOS) explains how these generous payments were funded. In late 2020, Customer E “received recommendations from True Potential to transfer his Firm A personal pension over to TP” - presumably following an acquisition. 

This transfer didn't come cheap:

Customer E accused TP of withholding fee schedules. The ombudsman disagreed on the basis that TP “did fairly inform Mr E of the initial and ongoing fees […] and that TP completed annual reviews and confirmed the ongoing suitability of Mr E’s pension savings and investments”. 

The ombudsman was more sympathetic to Mrs. C, who was prompted to switch pension to TP by an adviser who had just moved there. Importantly, even though Mrs C explicitly consented to the transfer, she subsequently claimed no involvement in the application: 

“The application … was submitted via Mr H’s computer at his office…. [Mrs C] says she never used Mr H’s computer to submit the application … and says that Mr H created and had access to their client log in details from the previous meeting”. 

The case centres on whether or not the transfer was advised. TP argued that, since the adviser had not drawn up the suitability report, he was in breach of contract. The ombudsman disagreed, on the basis of TP having "apparent authority", “which isn’t concerned with what was actually agreed between the parties (for example by way of the agency agreement), but rather, how the relationship between those parties appeared to third parties” i.e. customers.    

This was not the first time TP attempted to deflect the blame. The inner workings of the 8% scheme were inadvertently exposed in late 2023, when the firm sued another adviser for breach of contract. You can read the full story on Citywire, but here’s TL;DR:

TP’s growing notoriety alarmed the FCA, which appointed a “skilled person” to establish the facts under the so-called Section 166 review. Under scrutiny, TP conceded that “there may have been clients whose investments were not appropriately transferred into the Group due to payments made to advisers” (source: Kane Bidco 2024 annual report). Oops! 

In response, Cinven proceeded with a three-part shake-up plan: