This week, we speak with Dave Welling, CEO of Mercer Advisors. The Denver-based RIA has 450 employees and manages more than $21 billion. Welling’s nontraditional career path involves experience in consulting, private equity and technology, which has given him a unique perspective on the financial services business. Welling was named “RIA Firm Leader of the Year” by Wealth Management magazine.
Despite this being a “knee cap to knee cap business,” the firm was able to complete numerous acquisitions in 2020 during the pandemic lockdowns. He explains how the firm, which has been around for 35 years, began to grow through acquisitions over the past 4 years. We discuss the process the firm has deployed to do acquisitions, helping succession planning for small firm owners. The aging advisory industry also contribute to increased consolidation of independent RIAs. He discuss how deal structure has evolved in the face of plentiful capital available from private equity, and the alternative of very low rates. The buyers get a steady cash flow, effectively creating a higher yielding bond.
Welling explains how the firm manages to maintain a corporate culture, despite the distances. Rather than set up events and functions for different regional offices, they create specific events for specific company groups — all of the RIAs, or Tax professionals, or staff that work on Trusts, etc.
We discuss the lack of diversity in the industry, which Welling describes as “Male, Pale & Stale.” He explains what InvestHERs is — Mercer Advisors’ women’s initiative designed to promote diversity in the advisor industry. He believes that RIAs can “become a positive force for change.”
Welling talks about joining Schwab in 1997, instead of Amazon (!). He did not believe that was the best path for him and has never looked back at that decision.
A list of his favorite books are here; A transcript of our conversation is available here Monday.
You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here.
Be sure to check out our Masters in Business next week with Sébastien Page, head of T. Rowe Price’s Multi-Asset Division, which manages $363.5 billion. T. Rowe Price’s total AUM was $1.31 trillion.
Dave Welling’s Recommended Books
The Culture Code: The Secrets of Highly Successful Groups by Daniel Coyle
The Talent Code: Greatness Isn’t Born. It’s Grown by Daniel Coyle
Books Barry Referenced
Talking to Strangers: What We Should Know about the People We Don’t Know by Malcolm Gladwell