MIB: How to Build A Powerhouse RIA

How do you take an unknown Kansas-City firm with 150 million dollars in assets, and build it into a $45 billion powerhouse?

To find out, I sat down with Peter Mallouk, CEO of Creative Planning, and author of “The 5 Mistakes Every Investor Makes and How to Avoid Them.”  Mallouk explains how he used investor education to ensure clients understood the challenges of investing in markets that rise and fall. The firm grew through the 2007-09 financial crisis, even as other firms were losing clients and advisors. GFC presented an opportunity to distinguish the firm, and he credits this proactive approach for much of their success.

We also discuss why Mergers & Acquisitions in the Registered Investment Advisors (RIAs) space is the hottest it has ever been. Low rates and abundant capital has sent the private equity sector hunting for steady yielding cash flows, and they found it in advisory firms. Prices paid for the steady cash flow of asset management earnings of RIAs has driven multiples higher, and increased valuations significantly. Mallouk believes we are near peak M&A in the space.

His favorite books can be seen here; A transcript of our conversation will be available here.

You can stream/download the full conversation, including the podcast extras on Apple iTunesOvercastSpotifyGoogleBloomberg, and Stitcher. All of our earlier podcasts on your favorite pod hosts can be found here.

Next week, we speak with investor Sarah Cone, founder of Social Impact Capital, a New York based VC firm focusing on “teams doing good with technology.”




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