B. Riley Financial, Inc. (RILY): Business Model Canvas [Dec-2025 Updated]

You're trying to make sense of B. Riley Financial, Inc.'s strategy after all those recent debt adjustments and portfolio carve-outs; it's defintely not a simple setup. This firm blends high-touch advisory, capital markets access, and principal investing into a full-service model aimed squarely at the middle market, but the structure is complex. Honestly, looking at the numbers-like the estimated $1.46 billion in total debt against an expected H1 2025 revenue range of $405 million to $425 million-shows the tightrope they walk. This company is a fascinating mix of boutique advice and balance-sheet muscle. So, let's break down exactly how B. Riley Financial, Inc. is structuring itself for the next cycle using the Business Model Canvas below.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that keep B. Riley Financial, Inc. running smoothly, especially as they work to regain timely financial reporting. These partnerships are critical for capital structure and operational support.

The relationship with Oaktree Capital Management, L.P. is central to the capital structure, following the amendment to the senior secured credit agreement in July 2025. This amendment, which followed the initial agreement in February 2025, significantly altered the facility terms.

Here are the key financial figures related to the Oaktree amended Term Loan Facility:

For external assurance and compliance, B. Riley Financial appointed BDO USA, P.C. as the independent registered public accounting firm for the 2025 audit. BDO is noted as one of the world's top five accounting firms, with over 12,000 professionals across 75 U.S. offices.

The Great American Group businesses are now structured under a partnership with a global asset manager, finalized via a definitive agreement in October 2024. This partnership involves the following implied valuation and consideration:

• Implied total enterprise value for Great American NewCo: $386 million
• Oaktree stake via Class A Common Units: Approximately 53%
• B. Riley cash consideration received: Approximately $203 million
• B. Riley Class B Preferred Units initial liquidation preference: Approximately $183 million
• B. Riley retained Class A Common Units: Approximately 47%

Affiliated entities, like B. Riley Securities Holdings, Inc. (BRS), which carved out in March 2025, are key for internal cross-referrals and generating revenue. BRS reported specific financial performance metrics for Q3 2025:

• BRS Q3 2025 Total Revenue: Approximately $109.1 million
• BRS Q3 2025 Adjusted Net Revenue: $75.7 million
• BRS Q3 2025 Net Income: Approximately $41.8 million
• Capital raised for clients by BRS (Q3 2025): Approximately $10.5 billion
• BRS Cash and securities as of September 30, 2025: Totaled $145.9 million
• BRS outstanding debt: No outstanding debt

Regarding clearing firms for brokerage services, B. Riley Financial's preliminary estimates for the first half of 2025 mention calculating 'brokers net of due to clearing brokers'. B. Riley Securities' Q3 2025 results show total revenue of approximately $109.1 million, which reflects activity across its institutional brokerage business.

Finance: draft 13-week cash view by Friday.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Key Activities

You're looking at the core engine driving B. Riley Financial, Inc.'s operations as of late 2025. These are the actual activities that generate revenue and deploy capital across the platform.

Investment banking and capital raising for middle-market companies

The B. Riley Securities (BRS) segment is definitely active in advising middle-market clients. For the three-month period ending September 30, 2025, the firm reported robust deal activity. This included both equity and debt financings that totaled approximately $10.5 billion in capital raised for their clients. BRS's third quarter preliminary unaudited total revenue for this period was approximately $109.1 million.

Here's a quick look at the BRS Q3 2025 financial snapshot:

Corporate restructuring, financial consulting, and appraisal services

A significant part of the activity involves advisory services, often tied to asset monetization or restructuring mandates. The ongoing restructuring efforts, for instance, followed the bankruptcy of Franchise Group in November 2024. The first half of 2025 saw material gains from asset sales related to these advisory activities.

These activities are quantified by realized gains:

• Estimated gain on sale from GlassRatner: $66 million.
• Estimated gain on sale from Atlantic Coast Recycling: $53 million.
• Profits earned from equity participation in the JOANN's liquidation: approximately $29 million.

Principal investing and asset monetization of portfolio companies (e.g., Targus, Lingo)

B. Riley Principal Investments deploys capital opportunistically. As of June 30, 2025, total investments were estimated to be in the range of $310.0 million to $340.0 million. The company maintains ownership stakes in various entities, including the technology solutions company Targus, which was acquired in October 2022, and Lingo, where the ownership interest increased to 80% in May 2022. The portfolio also includes positions in publicly traded entities like Babcock & Wilcox Enterprises, Inc. (BW) and DoubleDown Interactive Co., Ltd. (DDI).

Wealth management, asset management, and financial planning

The wealth management business provides services across several areas for corporate, institutional, and high-net-worth clients. These services include:

• Brokerage services.
• Investment management.
• Insurance offerings.
• Tax preparation.

This platform was meaningfully enhanced by the acquisition of National Holdings Corporation in February 2021. Anyway, the parent company, B. Riley Financial Inc., is scheduled to change its name to BRC Group Holdings, Inc. on January 1, 2026.

Debt reduction and capital structure optimization (e.g., $600 million debt reduction by June 2025)

A major focus has been de-risking the balance sheet through aggressive capital structure management. The total Company debt reduction from September 30, 2024, to June 30, 2025, is estimated to be $600 million. This was achieved partly through five separate bond exchanges executed through July 2025, which collectively reduced total outstanding debt by approximately $126 million. For example, a single exchange on July 14, 2025, reduced debt by approximately $18 million. Following these exchanges, the Notes balance stood at $229 million, with $21 million of capacity remaining under the facility as of that date.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Key Resources

You're looking at the core assets B. Riley Financial, Inc. relies on to execute its strategy. Honestly, it's a mix of intellectual capital, hard cash, and a collection of operating entities that provide stability and deal flow. These resources underpin their ability to serve the middle market.

The firm's proprietary research and deep sector insights are channeled through B. Riley Securities (BRS), their preeminent middle market investment bank subsidiary. This network is active; for instance, BRS helped clients raise over $8 billion to support AI-driven investments over the past year. Also, their 25th Annual Investor Conference in May 2025 gathered approximately 200 public companies and over 1,000 attendees, showing the reach of their professional network.

A significant resource is the principal investment capital, which B. Riley Financial, Inc. uses for opportunistic, balance-sheet-driven deals. The management team has been aggressively managing this capital base, focusing on deleveraging while maintaining liquidity. As of June 30, 2025, the estimated cash, cash equivalents, and restricted cash stood at $268 million.

Here's a quick look at the balance sheet actions taken through H1 2025, which freed up capital for other uses:

The company's diverse portfolio of operating businesses provides a revenue base outside of pure advisory and investment banking fees. B. Riley Financial, Inc., which is set to change its name to BRC Group Holdings, Inc. on January 1, 2026, holds a portfolio that includes more than just financial services.

• Financial services platform for small cap and middle market companies.
• Telecom businesses offering consumer and business services like cloud phone, internet, and data.
• Retail companies providing home furnishings and mobile computing accessories.
• Realized cash proceeds from sales of operating units like GlassRatner and Atlantic Coast Recycling totaled approximately $187 million.

The network of financial professionals is key to deal origination and execution. This includes the professionals within B. Riley Securities and those managing principal investments. Their capital deployment activities in H1 2025 included achieving approximately $126 million of debt reduction via five bond exchanges. Furthermore, the amended senior secured credit agreement with Oaktree Capital Management now includes a new investment basket enabling an incremental $100 million to facilitate transactions.

Finance: draft 13-week cash view by Friday.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Value Propositions

You're looking at how B. Riley Financial, Inc. positions its core offerings in the market as of late 2025. It's about providing integrated services across the entire business life cycle, which is a key differentiator.

Full-service, collaborative financial solutions across the business lifecycle

B. Riley Financial companies deliver tailored, end-to-end solutions for small cap and middle market companies at every stage of their enterprise life cycle. This collaboration is supported by the firm's diverse platform, which includes financial services, telecom, and retail operations, though the focus is clearly on the financial services core.

Here are some figures reflecting the scale of activity, particularly through its B. Riley Securities (BRS) segment:

Ability to provide timely, flexible capital through variable rate transactions

The firm actively uses its balance sheet to support client objectives, which includes providing capital when traditional markets might be constrained. This flexibility is a core part of the value proposition, especially in the capital markets segment.

The B. Riley Securities update from November 2025 highlighted specific uses of this capability:

• Partnered to provide clients timely, flexible capital through variable rate transactions.
• Supported funding for emerging client priorities in AI investments.
• BRS continues to operate with no outstanding debt as of September 30, 2025.

Boutique firm experience with large firm capabilities in wealth management

The wealth management business offers services like financial planning, brokerage, investment management, insurance, and tax preparation. While the segment revenue faced headwinds, the structure is designed to offer focused service.

The reported revenue for this segment in Q1 2025 was $46.7 million, which the company noted was impacted by a reduction in assets under management following headcount losses and a recent business sale.

Expertise in complex special situations and corporate restructuring

B. Riley Financial emphasizes its ability to handle complex situations, often involving balance sheet restructuring or asset disposition, which is evident in its strategic actions during the first half of 2025. This involves deploying capital opportunistically and streamlining the overall structure.

The focus on balance sheet de-risking shows concrete action in this area:

• Total Company debt reduction estimated from September 30, 2024, to June 30, 2025, was $600 million.
• Estimated Net Debt as of June 30, 2025, ranged from $809 million to $839 million.
• Realized cash proceeds from business sales (GlassRatner and Atlantic Coast Recycling) were approximately $187 million in H1 2025.
• Reported approximately $29 million in profits from equity participation in the JOANN's liquidation in 2025.

Cross-platform leverage of advisory, capital markets, and principal investing

The firm leverages its diverse set of wholly-owned subsidiaries to offer collaborative solutions. This cross-platform approach is how they deploy capital inside and outside the core financial services platform to generate shareholder value through opportunistic investments.

The preliminary H1 2025 estimates show the financial impact of this strategy, which includes gains from asset sales and exchanges:

For B. Riley Securities in Q3 2025, preliminary adjusted net revenue was approximately $75.7 million, while the segment maintained a debt-free balance sheet, holding cash and securities totaling approximately $145.9 million at September 30, 2025. Finance: draft 13-week cash view by Friday.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Customer Relationships

You're looking at how B. Riley Financial, Inc. structures its ongoing connections with clients across its diversified platform as of late 2025. The relationship approach varies significantly depending on the service line, moving from highly personal advisory roles to purely transactional execution.

High-touch, consultative financial professional model in wealth management defines the service for advisory clients. This model is supported by B. Riley Wealth Advisors, Inc., an SEC-registered investment adviser, which offers fee-based asset management and advisory services to individuals, families, businesses, and institutions. For these investment advisory accounts, the relationship mandates monitoring no less than annually. This contrasts sharply with the brokerage side of the business.

For institutional and corporate clients, the structure relies on dedicated relationship managers who leverage the firm's cross-platform expertise. B. Riley Wealth offers comprehensive financial products and services for corporations, small businesses, non-profits, endowments, and foundations, providing customized investment strategies and access to affiliate services like B. Riley Securities, Inc. (BRS) for capital markets expertise. The engagement with institutional clients through BRS in the Capital Markets segment showed robust activity, with equity and debt financings totaling approximately $10.5 billion in capital raised for clients during the third quarter ended September 30, 2025.

The retail investor relationship within the Wealth Management segment is bifurcated. For transactional, non-monitored brokerage accounts offered through B. Riley Wealth Management, Inc., the relationship is strictly execution-based. In this setup, B. Riley Wealth Management, Inc. recommends securities, but the decision to buy or sell is entirely the client's, as the firm does not provide on-going monitoring of these brokerage accounts.

The firm's overall client base is broad, encompassing:

• Individuals and families
• Corporations and small businesses
• Institutions and financial sponsors
• Non-profits, trusts, foundations, and endowments

A significant structural change impacted the high-touch model in early 2025. Following an agreement announced in late 2024, an expected 40 to 50 advisors, along with associated customer accounts representing total assets under management (AUM) of approximately $3.5 billion to $4.5 billion as of September 30, 2024, transitioned to Stifel. This followed the segment's reported AUM of approximately $20.7 billion as of December 31, 2024.

Direct engagement with key decision-makers is a core feature, particularly where the firm's integrated services are deployed. For corporate executives, B. Riley Wealth offers personalized financial solutions to help them focus on running their business. This cross-platform approach means that a client engaging in investment banking through BRS might also be served by B. Riley Wealth Advisors for asset management or B. Riley Wealth Tax Services for tax preparation.

Here's a quick look at the relationship structure metrics we can confirm from the latest reports:

The firm, which announced its name change to BRC Group Holdings, Inc. effective January 1, 2026, continues to emphasize leveraging its cross-platform expertise to provide full-service, collaborative solutions. Finance: draft 13-week cash view by Friday.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Channels

You're looking at how B. Riley Financial, Inc. gets its services to clients as of late 2025. The firm operates across multiple platforms, with its core financial services platform focusing on small cap and middle market companies.

B. Riley Securities (Investment Banking and Institutional Brokerage)

B. Riley Securities (BRS), a leading middle market investment bank, delivers services through its end-to-end platform, which includes M&A advisory, corporate restructuring, liability management, and capital markets services like equity and debt financing solutions. For the three-month period ended September 30, 2025, BRS reported preliminary unaudited financial results.

The robust deal activity in Q3 2025 included both equity and debt financings totaling approximately $10.5 billion in capital raised for clients. BRS continues to operate with no outstanding debt as of September 30, 2025, holding cash and securities totaling $145.9 million.

B. Riley Wealth Management (Financial Advisors and Advisory Services)

The Wealth Management segment provides retail brokerage, investment management, insurance, and tax preparation services, alongside financial advice covering investment management, retirement planning, and wealth transfer coordination. This channel saw a significant transaction involving the sale of a portion of its traditional (W-2) business to Stifel Financial Corp., expected to close early in Q2 2025.

Prior to this transaction, B. Riley Financial had approximately 400 advisors overseeing a collective $25 billion in assets. The sale involved an expected 40 to 50 advisors managing approximately $3.5 billion to $4.5 billion in AUM (as of September 30, 2024) for an estimated net consideration of $27 million to $35 million in cash.

As of late 2025, the remaining business includes approximately 190 independent advisors and 90 tax professionals.

B. Riley Advisory Services (Consulting, Valuation, and Restructuring)

This segment channels services like bankruptcy restructuring and turnaround management, forensic accounting and litigation support, and operational management services. B. Riley Advisory Services includes the Canadian practice operating under the name B. Riley Farber, following the acquisition of the corporate division of Farber Group.

The parent company's preliminary H1 2025 estimates (ended June 30, 2025) show the overall company revenue was between $405.0 million and $425.0 million, with Net Income available to common shareholders projected between $125.0 million and $145.0 million.

• Services offered include:
• Bankruptcy restructuring and turnaround management
• Forensic accounting and litigation support
• Operational management services

Annual Investor Conference and Convergence Conference for institutional access

B. Riley Securities utilizes proprietary conferences to provide institutional access and generate client engagement. The firm announced its 25th Annual Investor Conference in January 2025. Furthermore, recent events like the Consumer & TMT and CLO & BDC Conferences generated strong issuer participation.

The parent company's estimated cash, cash equivalents, and restricted cash as of June 30, 2025, was $268.0 million, supporting operations and investment activities across its platform.

Digital platforms for account access and trade confirmations

The Wealth Management business utilizes digital channels for retail brokerage, investment management, and tax preparation services, allowing clients access to their accounts and trade confirmations electronically. The overall B. Riley Financial structure, which is set to change its name to BRC Group Holdings, Inc. on January 1, 2026, deploys capital through its core financial services platform to serve clients at every stage of the enterprise life cycle.

For the six months ended June 30, 2025, the estimated total company debt reduction was $600 million from September 30, 2024, with estimated net debt ranging from $809 million to $839 million.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Customer Segments

You're looking at how B. Riley Financial, Inc. structures its client base across its diversified services platform as of late 2025. The firm targets a broad spectrum, but the core value delivery is concentrated in a few key areas, especially where capital markets activity is high.

Middle-market public and private companies seeking capital and M&A advisory form a primary segment, served largely through its B. Riley Securities (BRS) subsidiary. BRS is positioned as a preeminent middle-market investment bank. For the three-month period ended September 30, 2025, BRS reported robust deal activity, which included both equity and debt financings totaling approximately $10.5 billion in capital raised for clients. This group relies on B. Riley Financial, Inc. for capital raising, M&A advisory, and liability management services.

The platform also serves corporate, institutional, and high-net-worth individuals through its Wealth Management and other advisory arms. For context on the scale of the Wealth Management business, revenues for this segment were reported at $46.7 million for the first quarter ended March 31, 2025. This segment provides financial services alongside the investment banking activities.

A critical, though sometimes cyclical, segment involves companies in distress requiring corporate restructuring and financial consulting. B. Riley Financial, Inc. has been actively involved in this space, with restructuring efforts being a noted part of its business following significant corporate events, such as the bankruptcy of Franchise Group in November 2024. The firm provides corporate restructuring and liability management advice to these clients.

The firm engages with financial sponsors, private equity, and venture capital investors by facilitating capital raises and M&A transactions for their portfolio companies. The overall investment banking franchise, B. Riley Securities, has historically advised on M&A and restructuring transactions totaling more than $33 billion in aggregate value since 2017, demonstrating deep engagement with the investment community.

While B. Riley Financial, Inc. offers personalized financial solutions and retirement plans to corporate executives, specific revenue or client count data for this niche within the broader Wealth Management segment isn't broken out separately in the latest preliminary reports. Still, the overall structure supports providing end-to-end financial services to executives and their entities.

Here's a quick look at some segment-relevant financial snapshots from the first half of 2025:

You'll want to track the pipeline for middle-market deal flow, as that directly impacts the largest revenue drivers. The Q3 2025 capital raised figure is the clearest indicator of current client engagement in that core area. Here's what that breakdown looks like:

• Middle-market companies: Primary focus for capital markets.
• Corporate/Institutional/HNW: Served via Wealth Management segment.
• Distressed Companies: Engaged for restructuring and consulting.
• Financial Sponsors: Supported via M&A and capital placement.

Finance: draft Q4 2025 client engagement pipeline by next Tuesday.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Cost Structure

The cost structure for B. Riley Financial, Inc. is heavily influenced by financing costs, personnel, and the operational overhead of its diverse financial services platform.

Significant interest expense due to total debt estimated at $1.46 billion is a primary cost driver. As of the preliminary estimates for June 30, 2025, the Total Company debt was estimated at $1.46 billion. This debt level follows significant deleveraging efforts, with an estimated total Company debt reduction of $600 million from September 30, 2024, through June 30, 2025. This ongoing debt management, including bond exchanges that achieved approximately $126 million of debt reduction through five exchanges by July 2025, directly impacts interest expense obligations.

Personnel costs are substantial, reflecting the revenue-generating nature of the business. Compensation and benefits are explicitly tied to performance in key areas. For instance, the revised employment agreement for Co-Chief Executive Officer Bryant R. Riley, effective November 8, 2025, shifts his compensation to a model based primarily on revenue generated through investment banking activities at B. Riley Securities, Inc. (BRS). For revenues generated between March 9 and September 30, 2025, Mr. Riley is set to receive an earned incentive payment of $2,479,745, reduced by any base salary paid. On a broader scale, the Accrued compensation and benefits for B. Riley Securities Holdings, Inc. as of December 31, 2024, stood at $27,075 thousand.

Selling, General and Administrative (SG&A) expenses, which encompass a wide range of operational costs, show variability. The prompt cites an example figure of $759.777 million in 2024. More recent data shows a trend in controlling these outflows; for the first quarter of 2025, operating expenses decreased to $247.5 million from $313.6 million in the first quarter of 2024.

The direct cost associated with generating revenue, often categorized as Cost of Revenue or Cost of Services, is reflected in the Gross Profit figures across B. Riley Financial, Inc.'s operations. For the fiscal year 2024, the Annual Gross Profit was reported as $716.43M. Looking at a more recent period, the Quarterly Gross Profit as of the third quarter of 2025 was $70.56M.

Ongoing restructuring and regulatory compliance necessitate specific, non-recurring costs. Legal and accounting costs are a component of this. Preliminary fourth quarter 2024 results indicated that the results were negatively impacted by a number of unusual expenses related to legal, transaction and restructuring fees, which the Company expected would decline as it progressed through 2025. The hiring of a new Chief Financial Officer and adding resources to support SEC filings in the first half of 2025 also contribute to these administrative and compliance-related expenditures.

Here is a summary of key cost-related financial data points:

• Estimated Total Debt as of June 30, 2025: $1.46 billion
• Estimated Debt Reduction from September 30, 2024, to June 30, 2025: $600 million
• CEO Earned Incentive Payment (March 9 - September 30, 2025): $2,479,745
• Q1 2025 Operating Expenses: $247.5 million
• FY 2024 Annual Gross Profit: $716.43M
• Q3 2025 Quarterly Gross Profit: $70.56M

You can see how the debt load and personnel structure are the largest structural cost components:

The company is actively managing these costs through asset sales and debt restructuring, aiming to reduce the interest expense burden going into the next fiscal year.

B. Riley Financial, Inc. (RILY) - Canvas Business Model: Revenue Streams

You're looking at how B. Riley Financial, Inc. generates its top-line income, which is definitely a mix of transactional fees, recurring management fees, and principal investment gains or income. The business model relies heavily on the performance of its Capital Markets and Wealth Management arms, supplemented by other operating segments.

For the first quarter of 2025, the total reported revenue was $186.1 million. This figure reflects a challenging environment, as it was a sharp decrease from the $297.6 million reported in the first quarter of 2024. Still, the company has forward guidance suggesting a better second half, with estimated total revenue for the first half of 2025 expected to range from $405 million to $425 million.

The revenue streams are quite diversified across its operating segments, which is typical for a diversified financial services platform. Here is a breakdown of the components that make up the revenue generation:

• Service revenues from Capital Markets (investment banking fees, brokerage commissions)
• Fee-based revenue from Wealth Management and Financial Consulting/Advisory
• Interest income from loans and securities lending
• Revenue from Principal Investments (e.g., sale of goods from Targus, Communications revenue)

The Q1 2025 segment performance gives you a clear view of where the money came from in that specific period. Note that the Financial Consulting segment revenue is not explicitly broken out in the Q1 2025 data found, but it is a reportable segment.

Interest income, which falls under the lending and investment side of the business, showed specific figures for the first quarter of 2025. This is income generated directly from the assets B. Riley Financial holds on its balance sheet, separate from the fee-based services.

Here's the quick math on that interest component for Q1 2025:

• Interest income from loans was $3.2 million.
• Interest income from securities lending was $0.84 million (or $840K).

The Capital Markets segment, which includes investment banking fees and brokerage commissions, generated $4.36 million in Q1 2025, showing a significant year-over-year decline, impacted by reduced corporate finance activity. To be fair, Wealth Management also saw a dip, with revenues at $47.28 million for the same quarter, partly due to changes in assets under management following business sales, such as the partial sale to Stifel for up to $35 million.

Revenue from Principal Investments is captured across several segments listed in the table above. For example, the Consumer Products segment, which includes Targus, contributed $42.10 million in Q1 2025. The Communications segment, which saw revenue fall due to divestitures like the Lingo wholesale carrier business, still brought in $64.47 million in Q1 2025.

Finance: draft 13-week cash view by Friday.