A Legacy of Uncommon Kindness and Shared Ownership Helped Build a $1.5 Billion RIA
Max Weldon Greer Jr. planned to step down in January from leading the Kansas City RIA he founded in 1980. The transition never took place. In November, Greer died unexpectedly of a heart attack at age 72. But thanks to an ownership structure more than two decades in the making by the caring executive, the company itself was prepared for his sudden absence.
Compared to his industry peers, Greer was on the fast track to getting his professional house in order. According to a 2018 study from the Financial Planning Association and Janus Henderson Investors, only 41% of advisors report having some form of succession plan and just 27% have a formally documented plan. Even among advisors managing $500 million or more of client assets, only 60% have a formal plan.
Why RIAs raid other RIAs for talent
A new study from Charles Schwab indicates that RIAs are increasingly looking amongst themselves for new talent.
According to the RIA custodian’s 2020 RIA benchmarking study, other RIAs were the most popular source of talent for advisory firms with more than $250m in assets under management. Schwab found that 39% of respondents to its survey — which contained self-reported data from 1,010 firms — recruited staffers from fellow independent advisory businesses in 2019.
Most RIAs Unprepared to Strike an M&A Deal: Survey
A large swath of the RIA sector is not prepared to approach merger-and-acquisition deals from a position of strength, according to a new survey from Advisor Growth Strategies, a managing consulting and transaction advisory firm.
The survey results revealed an industry concerned about growth and next-generation talent, but intimidated by the complexity of the M&A landscape.
Has the Pandemic Altered Valuations for RIA Firms?
About Our Episode
It’s rare that anyone outside of a few investment bankers gets to take a look at transaction data for M&A deals in the RIA industry. But the RIA Deal Room 2020 report from Advisor Growth Strategies goes “under the hood” to show how M&A has continued to shape RIAs in recent years, while also providing a first look at how the pandemic will affect transactions moving forward.
About Our Guest
Brandon Kawal has been a principal at Advisor Growth Strategies for over six years and leads client engagements, thought leadership, and research. AGS is a leading consulting firm with a client portfolio of 250+ firms that provides custom business management solutions to the nation’s top advisory firms. AGS projects include assisting RIAs with compensation and equity design, advisor in transition services, growth strategies, management support services, succession and exit planning, and transaction advisory.
Here and Now with Brandon Kawal
Brandon addresses the following questions via video:
What role does equity play in the "flight to certainty" you've seen in the industry?
Why do sellers choose certainty over long term participation?
As M&A activity ramps back up, RIAs need to bone up on the details
As the pace of merger and acquisition activity in the RIA space ramps up following a three-month pandemic-related lull, the latest concern is around a gap in understanding the nitty-gritty details of what business consolidation is all about.
“Deal structures are rapidly evolving, and the industry is too dynamic to just say, ‘I want to do M&A,’” said Brandon Kawal, principal of Advisor Growth Strategies.