The Financial Advice Gap: Why Technology Is Now Central to M&A in Financial Services

In today’s fast-paced economy, the financial services sector is undergoing profound transformation. One of the most concerning insights from the FCA’s latest Financial Lives Survey reveals that nearly 90% of UK adults lack access to regulated financial advice. This is more than a troubling statistic—it highlights a systemic issue that presents both risk and opportunity for firms involved in mergers and acquisitions (M&A).

M&A is no longer just about combining balance sheets. It is about aligning expertise, unlocking operational synergies, and—most critically—delivering real client value. In an advice-starved market, firms that fail to address access, technology, and integration risk leaving significant value on the table.

The Advice Gap: A Market Challenge and a Growth Opportunity

The advice gap reflects a major unmet need across the UK financial landscape. For M&A activity, this signals two important realities:

• There is significant untapped demand for scalable advice solutions.
• Firms that successfully integrate advice-led technology gain a clear competitive advantage.

For example, acquiring a fintech-enabled advisory firm can create rapid growth—but only if the buyer understands how to integrate the technology effectively. Without a clear tech integration strategy, potential value creation can quickly erode.

For acquirers, the message is clear: understanding how advice is delivered is now as important as understanding revenues and assets.

The Technological Edge in Modern Financial Services M&A

Technology is no longer a support function—it is a core driver of value. Innovations such as robo-advice, AI-driven financial planning tools, and data-led customer engagement platforms are reshaping how advice is delivered at scale.

From an M&A perspective, technology must be evaluated as a strategic asset during due diligence. Key questions include:

• What customer engagement technologies does the target business use?
• How mature and secure are its data and analytics processes?
• How easily can its infrastructure integrate with the acquiring firm’s systems?

Data is no longer confined to spreadsheets. It defines customer relationships, operational efficiency, regulatory compliance, and long-term scalability. A structured technology assessment reduces post-deal risk while uncovering hidden synergies.

Valuation in the Age of Fintech and Digital Advice

Traditional valuation models often struggle to capture the full worth of technology-driven businesses. Intellectual property, proprietary platforms, and subscription-based revenue models require a future-focused valuation approach.

When evaluating tech-centric financial services firms, acquirers should consider:

• Market potential: How defensible is the technology’s competitive advantage?
• Future revenue streams: What does customer lifetime value and retention look like?
• Customer acquisition costs (CAC): Are they scalable and sustainable?

Advanced data analytics and forecasting models enable more accurate valuation in an increasingly digital market. Firms that fail to properly assess technology risk overpaying—or worse, underutilising assets post-acquisition.

Post-Merger Integration: Where Most Value Is Won or Lost

Even the most strategically sound acquisition can fail at the integration stage. Cultural misalignment, incompatible systems, and fractured customer experiences are common value destroyers.

Technology plays a decisive role in smoothing post-merger integration by:

• Aligning operational workflows across teams.
• Supporting consistent client communication and advice delivery.
• Enabling a unified customer experience through shared CRM and advisory platforms.

Successful integration requires clear planning around:

• How teams will collaborate across different systems and methodologies.
• How customer data will be unified and protected.
• How advice delivery will remain seamless throughout the transition.

When technology is treated as a strategic enabler rather than an afterthought, integration becomes a growth accelerator rather than a bottleneck.

The Path Forward: The Evolving Role of M&A in Financial Services

The role of the modern M&A advisor has evolved. Today, we are not only transaction facilitators—we are strategic partners guiding clients through complex technology, regulatory, and operational challenges.

By embedding technology analysis into every stage of the M&A lifecycle—from target identification to valuation and post-deal integration—we can:

• Help close the UK’s growing financial advice gap.
• Unlock sustainable long-term value.
• Future-proof financial services businesses for an increasingly digital market.

Let’s Build the Right Strategy for You

The opportunity is significant—but it demands a nuanced understanding of financial advice, digital platforms, and strategic integration.

If you are considering a merger or acquisition in the financial services sector, now is the time to ensure your strategy is built for the future.

Get in touch today to discuss how we can help you navigate the complexities of M&A, strengthen your technological position, and deliver exceptional value to your clients.

Let’s connect and explore your next strategic move.

brian@ortussp.co.uk