Echelon says it puts together the only comprehensive benchmark in the space. Echelon Partners has released the year-end 2007 edition of its Seivert Report, a quarterly valuation report covering ten different sectors of investment product developers, distributors and service providers. The investment-banking and consulting firm used fourteen valuation metrics and fourteen financial metrics to profile 177 companies representing $10.6 trillion in enterprise value, $3.4 trillion in equity value, and $1.7 trillion in annual revenue.

Echelon figures it's the first outfit to provide of valuation metrics for private companies in the investment-management areas covered in the Seivert Report -- a sub-segment it says accounts for nearly a quarter of the financial services industry.

Leaders and laggards

"Executives have long wanted uniform benchmarks to accurately value companies in this sub-sector, and thus far have come up empty-handed," says Echelon's CEO and managing director Dan Seivert. "We wanted to target that void."

Echelon's "Investment Brokerage-National" sector had the highest total market value -- over $1.005 trillion -- of the ten sectors, narrowly edging "Foreign Money Center Banks" for the second consecutive year. The "Investment Brokerage-Regional" sector meanwhile surged past "Exchanges/Trading Systems" to post the highest median revenue growth rate (22.0%) for 2007. The "Investment Processing Solutions" sector posted the lowest median revenue growth rate at 3.3%, down from 7.5% for 2006.

The "Exchanges/Trading Systems" sector emerged with the highest estimated long-term growth rate at 18.6%, while "Regional and Trust Banks" project as the lowest at 8.7%.

Overall the most consistent sectors were "Foreign Money Center Banks" and "Investment Managers," judging from the number of appearances on Echelon's Sector Leader Board. The least impressive sectors -- based on the number of appearances on the Sector Laggards Board -- were "Insurance Companies in Investments" and "Alternative Investment Managers." You can get a copy of the Seivert Report here.

Los Angeles-based Echelon, formerly 3C Partners, was founded in 2001 to provide investment-banking and consulting services to the investment- and wealth-management industries. -FWR

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