Ep 462: Making The Tough Decision To Change Firms To Find The Path To Equity Ownership You're Seeking with Maggie Rapplean

Summary

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Financial Advisor Success Podcast: Ep 462

“Making The Tough Decision To Change Firms To Find the Path to Equity Ownership You’re Seeking”

Host: Michael Kitces
Guest: Maggie Rapplean, Partner at Moneta Group
Date: November 4, 2025

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Episode Overview

In this episode, Michael Kitces interviews Maggie Rapplean, a partner at Moneta Group, about her unconventional journey toward equity ownership in the financial advisory industry. Maggie discusses her transitions through different firm models—from a wirehouse to a startup RIA, and ultimately to Moneta—detailing the motivations, challenges, and decisions that shaped her path to partnership and building her own successful advisory team. The conversation delivers candid insights into the complexities of equity paths, practice growth, business succession, integrating work and family life, and the importance of business development for advisors seeking long-term independence and success.

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Key Discussion Points & Insights

1. The Drive for Ownership and Autonomy

Motivation for Equity:

• Maggie’s entrepreneurial mindset was present from the start of her career.
• Early wirehouse observations revealed that lack of equity limits end-of-career choices for advisors.
• Ownership provides flexibility and control in how to serve clients, design teams, and monetization at exit.

“I wanted the opportunity to own my own business or have some level of ownership in whatever entity it was that I was operating in.”
—Maggie [04:49]

2. Career Path & Firm Transitions

a. Starting in the Wirehouse Model

• Benefitted from extensive training, camaraderie, and resources—“the training was amazing.”
• Saw the limitations: “the advisors don’t really actually have ownership equity in their client base.” [06:33]

b. Moving to a Startup RIA

• Joined mentor in breaking away as an independent RIA, becoming direct with a custodian.
• Realized loss of support: resources, camaraderie, infrastructure—all missing.
• No clear, defined path to partnership or equity.
• Maggie’s business development skills made it “demotivating to help create something I couldn’t eventually own.” [13:56]

c. Searching for a Sustainable Equity Path

• Realized ownership opportunities are rare, especially for younger advisors.
• “I was essentially selling my future for a comfortable salary.” [08:34]
• Moneta offered clear, structured paths to both practice and firm-level equity, with flexibility in team design and ownership.

3. Transition to Moneta Group

• Brought ~$200,000 in revenue and several self-developed clients. [21:27]
• Took over clients from a retiring Moneta partner (inheritance plus opportunity to buy the book via earnout).
• Clearly outlined metrics for partnership (“four pillars”: business development, operations, leadership, and practice management) [23:22].
• Unique model: full ownership over clients she brought in and those purchased, with the ability to grow into additional firm equity as revenue increases.

4. Practice Structure & Growth at Moneta

• Started with ~26 inherited clients/$450k revenue and own clients/revenue; now at 108 clients and $1.6M revenue. [36:13, 39:27]
• Successfully transitioned most clients from the prior advisor by:
  • Extended, multi-year handoff (3 years), building “relationships with both advisor and clients.” [54:45]
  • Providing new value (re-doing financial plans, deeper tax/estate advice, enhanced communication, generational connections).
• Grew additional client base through direct business development, another internal advisory team (Moneta Advisory Services), client referrals, and being visible in the community.

“Clients seem to be relieved that there was a plan.”
—Maggie [40:25]

5. The Partnership Process & Economics

• Partnership eligibility: minimum $500k in revenue PLUS demonstration of operational/leadership capabilities.
• Two streams of profit/equity:
  • Ownership of team/practice client base.
  • Option to buy units/shares in Moneta’s holding company, with distributions based on firm profits.
• Earnout structure for purchasing book; designed over a 6-year period, motivated by both growth and risk minimization.

“It was like a Roth conversion...the sooner I do this and the younger I do this...the more upside I’m going to have.”
—Maggie [76:51]

6. Business Development and Growth Mindset

• Early focus: “If you can bring on $1M in assets, over time you can bring on $10M or $100M.” [14:18]
• Modern growth comes 50% from client referrals, the rest via visibility, accolades, and proactive outreach.
• Advice to young advisors: prioritize business development and soft skills EARLY, even if not required by your firm.

“Even if you get into a role where you’re paid a salary and not really required to bring on clients, you should still focus on business development.”
—Maggie [81:24]

7. Balancing Ownership and Work-Life Integration

• Surprised by the level of flexibility and control that practice ownership allows while still being able to “be present as a parent.”
• The journey included navigating family changes, COVID disruptions, and building a support network (“built an army” for family/child care support).

“I have more freedom and flexibility than I thought I was going to have...young parents in the industry should know that over time it does get easier and you can design your own life.”
—Maggie [73:09]

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Notable Quotes & Memorable Moments

• Finding the right firm:

  “Do thorough research on the firm...making sure they 100% align with your values.”
  —Maggie [79:18]

• On supporting clients through succession:

  “We gave them three years...he was sitting with me in every single review...eventually worked his way out of the relationship.”
  —Maggie [54:45]

• On setbacks and perseverance:

  “I wasn’t sure I made the right choice at that time...in hindsight, it was the smartest thing I ever did.”
  —Maggie [75:38]

• On defining success:

  “I just want freedom...to do things with my family, take good care of people, set an example for my kids. As long as I know I’ve taken good care of people, that’s success to me.”
  —Maggie [85:06]

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Timestamps for Key Segments

| Timestamp | Segment | |------------|--------------------------------------------------------------------------| | 04:49 | Why Maggie pursued equity and ownership | | 08:34 | From wirehouse to independent RIA: Pros, cons, and turning points | | 13:56 | Realizing need for clear equity path; misalignment at previous RIA | | 20:19 | Transition to Moneta; timing with family and pandemic | | 21:27 | What Maggie brought to Moneta; succession opportunity | | 23:46 | Moneta’s four pillars and partnership process | | 36:13 | Starting base (“about $250k revenue”); growth to present | | 40:25 | Building trust in client transitions; emotional responses | | 54:45 | Details on three-year client transition process | | 73:09 | Work-life integration surprise: achieving flexibility | | 76:51 | Reflecting on early transitions as “like a Roth conversion” | | 81:24 | Advice to younger advisors: develop business development skills early | | 85:06 | Maggie’s current definition of success |

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Conclusion

Maggie Rapplean’s episode is a rich resource for advisors seeking real-life guidance on navigating career choices, practice growth, and the pursuit of equity in advisory firms. Her story is one of initiative, strategic risk-taking, and the persistence to build a business that provides both personal and professional fulfillment.

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Listen to the full episode for a granular, behind-the-scenes perspective on building ownership, leadership, and balance in today’s financial advisory world.

Transcript

[A]

Welcome to the Financial Advisor Success Podcast where you go behind the scenes with financial planner, speaker and consultant Michael Kitces to hear stories of how leading financial advisors navigated the inevitable challenges that arise on the path to success and get insight from leading industry consultants about how to break through to the next level in your advisory business. And now, here's your host, Michael Kitces.

[B]

Welcome everyone. Welcome to the 462nd episode of the Financial Financial Advisor Success Podcast. My guest on today's podcast is Maggie Raplin. Maggie is a partner at Moneta Group, an ria based in St. Louis, Missouri where she oversees $250 million in assets under management for 108 client households. What's unique about Maggie, though, is how she made the tough decision to switch industry channels and firms to eventually find the path to equity ownership that she was seeking and building a successful advisory team in the process. In this episode we talk in depth about how Maggie began her career working within a wirehouse where she benefited from strong business development TR and camaraderie with fellow advisors but didn't have a path to ownership how Maggie then transitioned with her team from the wirehouse to start an independent RIA but found it challenging without the resources of a larger firm and saw no clear path to equity ownership and how Maggie decided to move to Moneta Group, which offered her the resources of a larger firm from technology to advanced planning expertise as well as a well defined path to partnership. We also talk about how Maggie has built her team within Mineta not only by transitioning some of her previous clients and adding new clients through a growing referral network network, but also by taking over the clients of a retiring advisor how Maggie retained the vast majority of these clients by first working alongside the retiring advisor, creating a warm handoff that built client confidence in her and then by showing how she could offer additional value by refreshing these clients financial plans and offering deeper advice in tax planning in other areas and how Maggie's success serving these clients and growing her business led to both an opportunity to buy the book of business from Mineta through an earnout structure and to eventually become eligible to buy a stake in the firm as a partner and be certain to listen to the end Where Maggie shares how her early success winning new clients gave her the confidence that she could have long term success in the industry and how she encourages newer advisors to seek out business development training to develop those skills why Maggie wanted to pursue an ownership stake in a firm not only to share in the success of the business where she worked, but also for the flexibility it could provide her down the line when it comes to her own succession. And how Maggie has found that leading her own team has helped allow her to balance her career and growing practice with the ability to be engaged with her family at home. And so with that introduction, I hope you enjoy this episode of the Financial Advisor Success Podcast with Maggie Raplin. Welcome Maggie Raplin, to the Financial Advisor Success Podcast.

[A]

Thank you, Michael. I'm excited to be here.

[B]

I really appreciate you joining us today and I'm looking forward to getting to talk a bit about just paths to equity and advisory firms, which I find has really gotten kind of complex in our advisory world in, in recent years is some firms just don't have a path to equity. And like it's not even the attention, you know, you, it's a job, you get to serve clients, you earn a nice salary and bonus. You maybe don't have the upside of equity. You also don't have the risks and the hassles, maybe the debt buy ins of being an equity partner. But for a lot of advisory firms, I think like a lot of other professional services firms like a law and accounting, like there is some path to equity, particularly as firms get larger and either they want to retain their talent or they need to retain the talent, especially the talent that's doing business development and causing the firm to be larger. So at some point as a founder, you decide to own a smaller piece of a larger, grow faster growing pie and expand equity. But for individual advisors, it's a lot to navigate. Do I need to be at a firm that offers a path to equity? Do I actually care if there's a path? Do I really want to do the things that they are going to require me to do in order to get to being a partner? Do I really want to take the risk that comes with the debt and the buy in as a, as a partner? And to what extent does that give me like an actual seat at the table to make decisions about the firm or not? If it's like a really big firm with lots of partners that doesn't want to do everything by committee. And I just, I know you have traveled this path with like multiple decision points along the way about how important is it to be at a firm where there's a path to partnership? Are you at the right firm to be able to pursue equity and then going through a buy in process? So I'm excited to talk today about like what that path has been like for you in this, you know, pursuit to becoming an equity partner and advisory firm and I don't know, the trials and tribulations and like learnings and discoveries along the way.

[A]

Yeah, I'm, I'm excited to discuss that. I think I've had a unique path in this industry, seeing multiple platforms throughout my career and really early on in my career. I think I've always had an entrepreneurial mindset. And I think I decided really early on that I wanted the opportunity to own my own business or have some level of ownership in whatever entity it was that I was operating in. So excited to talk to you about that.

[B]

So. So I'd love to even just start right there. I mean, can you just share a little bit more? Like why this, why this drive for ownership?

[A]

I think for me it's the autonomy to be able to create something and culture that I want to create over time. Being that I'm going to be doing this for 40 plus years and working on the different platforms that I've worked on. I've always desired to have something that I'm creating and something that I can own and monetize over time. Early on, starting out in a large wirehouse, I saw several advisors that had committed their working careers to building something over time and then coming to the conclusion at the end of that that they didn't have as much freedom of choice on how they wanted to either pass it on to next generation or monetize it as an exit strategy. And seeing that firsthand at such a young age, I think that opened my eyes to what this industry can offer over time. And so I decided that I was going to seek out a firm or an opportunity that was going to offer me the freedom to make that choice at the end of my career.

[B]

Interesting. So the. So for you, having started in large firm wirehouse, right. You know, employee W, two models, we kind of say there are books, but they're, they're really not, as you notice when you try to sell an exit that you're, you're kind of subject to the terms of the firm. So you started at one of those big firms where at the end of the day the advisors don't really actually have ownership equity in their client base. And said it's important for me to have the choices at the end.

[A]

Yeah.

[B]

So there's the beginning where we are, there's the end when we're ready to be done in exit and there's all the journey along the way. And so just I guess inferring from hearing like a lot of this for you was about controlling the end, like how this winds down, freedom of choice of who. Who will take over or how I exit or how I monetize the exit, or who actually will serve my clients after I'm gone. Like, just the. The endpoint stage seems very important for you here.

[A]

Yeah. And then I think as I got further into it and deeper into my research and started to experience it, you know, working in a fee only ra, I saw that culturally there was things that came along with ownership that were attractive to me as far as how we serve our clients. Autonomy to serve our clients, no conflicts of interest, flexibility on how we design our teams. You know, some of that freedom I didn't really see in the larger employee models. And that was, you know, kind of helped me stick with my conclusion that that was the path that. That I wanted to take.

[B]

So I guess help us understand a little bit of your path, because I'm hearing like, there was wirehouse at some point. There was fee only RIA at some point. So what's. What has this journey been for you?

[A]

Yeah. So I started out my career, like I said, in a large wirehouse. The training was amazing. The leadership. I learned a lot. I got a full scope of what the industry offered. I was able to get licensing. I had great camaraderie among the firm, lots of experience, and working with different types of clients with a lot of volume. So I think that the training was great. I joined a large team within that wirehouse. We had a focus on 401k plans and institutional business and then private wealth management. Learned how to function on a team, Learned a lot from that leader. He, you know, taught me how to do business development. Really early on. He taught me how to serve clients. I sat in countless meetings and got great trading. And then the culture at the firm changed. There was some headline risks and some things that occurred at the firm. And I saw him have to come to some conclusions at the end of his career. Nearing the end of his career, we decided to exit that large wirehouse and start a standalone RA that was 100% owned by the original founder of the team. We were direct with a custodian. So there was a small intermediary that helped us transition. But at the end of the day, it ended up being us. With a custodian. There was no resources. There was no more camaraderie, in my opinion. We were writing our own HR policies. Everything was from scratch, which I admire some people, they desire to do that, and I admire anyone that does that. I admire my past partner, or however you want to name that relationship, mentor, leader. But at the end of the day for me and what that meant for my career path was I didn't have a lot of resources anymore. There wasn't really a clear path to partnership at that point. I was starting to gain my own clients and notice that I had the ability to do business development and bring on clients and that I had a real desire to do this for the long term. And I had to decide with myself, is this really where I see myself the next 30 years? Not having a clear path, path to ownership or a defined path? I'm not the type of personality that can deal with vague visions or opportunities that may come up in the future. I need more of a defined path as far as like motivation. So I made the decision that that was not the right model for me. And so I started seeking out other firms and opportunities that were going to offer me the path to ownership. I found out really quickly that is very rare in the marketplace, especially for someone at that stage in my career. I was offered multiple salaries, great salaries, along with a non solicit agreement and indefinitely. Me, I was essentially selling my future for a comfortable salary. I was not comfortable with that. And I came upon Mineta and the more I dug into it, it's 100% privately owned. The first conversations that I had were, well, you could take the path to partner route, you could take the advisor route and, and both are great lucrative careers. And they, they can be for some. I was just wired a little bit differently and knew that internally and I knew that I had a lot of potential over the long term and I wanted to start something for myself and I wanted to have interest and equity in the firm that I was at. And Mineta was the only firm that I could find that gave me a distinct path to partnership and that would allow me to start out on my own from that point that I was at in my career. And so that was five years ago. I'm going on six years in January.

[B]

So I'm fascinated by this and kind of the transitions or the transitional moment that came at the initial ra. So the RA you were at was effectively the wirehouse team that had broken out on their own. And you went with the team and the clients at that point, like that was how you got there.

[A]

Yeah.

[B]

But then the challenge point is, I guess ironically they taught me to do biz dev. Now I can do biz dev now I'm excited to this for long term and build my client base. And I don't think I really want to do this where I don't actually have any equity in what I'm doing building.

[A]

Right. It was essentially a startup. So everything that I was doing was helping to create that entity. And I didn't own any portion of it, nor did I have a path to ever own any portion of it.

[B]

And. And so particularly given that you were bringing in clients, that feels mismatched for you? Yes, because I'm just from, from what I'm inferring, it's the, like, it's the point that the biz dev got going for you that this across birds moment, not, not before.

[A]

Right.

[B]

Is that fair?

[A]

Yeah. When I started to realize, I mean, mind you, I got into the industry in my mid-20s, so around the age of 30, I started to notice that I most likely was going to be successful in this industry. You know, it's my opinion and I tell other advisors as, as they come on, you know, if you can bring on a million dollars in assets, I'm pretty sure that over time you can bring on $10 million and $100 million in assets. And so for me, seeing my potential, it was really important to me that I had a vision and something that I was working towards. Especially when you're in a startup mode of an RIA and the, what that really takes in terms of time and stress to start that from scratch.

[B]

So I guess I'm also struck or just fascinated with that conversation. So you mentioned a few times earlier, one of the challenges around going from the Wirehouse to the RA was the change or like the reduction in resources. So can you share a little bit further? Just what does that mean to you? Like just when you say resources, what are the resources that you had in the old firm that you didn't have with the RIA plus custodial platform?

[A]

So with the Wirehouse, what you have is you have an influx of resources and data and planning tools that has gotten a lot better since when I was there. But planning tools, investment research, management, leadership, client events, anything that you could really think of that in a small startup ira, you don't have those and maybe those are luxuries that I didn't realize I had while I was there. Right. But when you leave and you realize there's no more team lunches, there's no more wholesalers every five minutes walking through your door offering some kind of golf event or a lunch. There's no more investment analysts that's offering you this nice written up email every morning promptly when the market opens on exactly what's happening that day. There's no more trading platforms with models Already designed, which, those are some of the things that I saw some conflicts in from the very beginning. So I knew that I was going to have to do some of that. But when you go from that to completely startup, it's definitely an adjustment in culture. And I was a little bit younger and naive then to where I'm at today. Now I'm comfortable creating, I do a lot of creating now on my own team and I don't necessarily have all the resources that I had when I was at the Wirehouse, but with Mineta, I feel like it's a smaller firm but with a whole lot more resources to where I can really focus on what I'm good at. But those are some of the examples of things that you give up when you leave an employee model, a large employee model, I would say.

[B]

And so that was, I'm going to presume that part of the appeal of finding, at least in the independent channel, a larger firm like where you went with Monetta. Because at least, at least as independent firms go, like you have many hundreds of employees and a lot more resources than we're a startup and we have six people and we're figuring everything out. We're building everything from scratch while we fly the plane.

[A]

Yeah, yeah. And I mean, I think that's admirable to start firms from scratch or even operate as, as a one owner and you know, build your tech stack and do everything from the start when, when you own it and you have interest in it. That was an issue for me because I felt like I was creating something that was never going to make mine and potentially not even mine long term. And that just from my personality that was really, really devote demotivating to me and I needed to have a longer term vision for myself to continue to grow at the pace that I wanted to grow at. And I wasn't sure that that was the right things for my clients. I had some clients at that point and some of the oversight and compliance and some of the things that were not there I wasn't really quite comfortable with. And I wasn't sure that that was going to be the right thing for my clients long term either.

[B]

So, so what was the actual next step like? You're, you're, you're at the Breakout Ria with I guess some clients of the team that you serve and some clients that you brought in. And here's this big firm that says they have some paths to equity, but presumably they're still stuff to do and figure out. So what actually happened next? How did this proceed?

[A]

Well, I stayed at that firm for some time. I was loyal to my team. I cared deeply for them. I cared deeply for the clients that I had served over the last five, six years. So I stayed at the firm. I stuck it out, I watched, I observed. I started doing some research on other firms. I had, you know, recently been married, and I was actually pregnant with my daughter at the time. And so I think, you know, having my daughter and starting my family really, really got me thinking deeply about the path that I wanted to take. And I knew in order for me to really be happy and be bought into the vision, I had to, to make a change. So shortly after having my daughter, I. I had been interviewing with firms and I came to the conclusion that Moneta was the best option. And so I made that leap. I did that in February of 2020, which was.

[B]

Oh, that was some fun timing.

[A]

Yeah, it was a great time to do another transition. But I did. I was custodied at the same custodian, one of the custodians that we custody with here at Mineta. So that transition was not as big as going the wirehouse to the initial custodian. So that transition wasn't as difficult as the first one. However, it was right before COVID so that made it all the more challenging. But I made that second leap.

[B]

So I guess I'm just trying to visualize how, what the, what the flow or plan was at this point. Are you, are you bringing a full size book of clients with you? Did you have to leave clients behind because of other employment agreements and start over? Did like Moneta have firm clients for you to take over? Like what, what were you, like, bringing or not bringing or getting into as you made this transition?

[A]

It was a unique opportunity I was able to bring. It ended up being around 200,000 in revenue is what ended up coming on. Now I had been doing some business development at the time as well. So, you know, I landed a few clients those first couple months and then I had transitioned some clients. But walking in the door to Minetta, I would say I had about 200,000 in revenue. The opportunity at Minetta, alongside the path to partnership was there was also a prior partner at Mineta that did not have a succession plan in place. He had a retirement date and there was an opportunity for me to help him transition his book to where I would be the lead advisor. So it wasn't at that point, any type of a transaction. It was, you know, for that I would be essentially an employee in helping with that transition. But Had I met, or if I met the business development goals of Path to Partnership here at Mineta, then I would have the opportunity to buy that business.

[B]

Oh, interesting. All right, so it has. I want to. I'm kind of processing through that. So you've got some revenue that's coming along, but they've got an existing advisor with a client base. The advisors retiring, you can come in and be the lead advisor on that. That's not a equity partner gig thing, that's an employee gig to service the clients of the firm that get transitioned to you. But the firm, I guess like separately or in parallel has a path to partnership if you do enough business development. And so if you did enough business development, you would have a path to partnership kind of built around that client base.

[A]

Yeah. And we have four pillars for partnership. So not only did I have to do business development, I had to learn operations and practice management and leadership and meet all of those metrics to eventually qualify for partnership. And you're voted in as a partner based on the metrics that you meet. But I knew that that path existed and I knew that that was achievable.

[B]

Can. Are you able to share more details on just what those metrics are like, what do they measure and how do you get scored? What do you have to do to actually follow the path?

[A]

Yeah, so the business development aspect, I would say the minimum is 500,000 in revenue. My situation was unique because I knew that I had to be sustainable. So 500,000 in revenue, when you look at all the expenses that go with hiring staff and then paying the firm a management fee, which is fair, you need a little bit more than 500,000 in revenue. Right. But for some of the other teams, we've got 27 teams. All those circumstances are unique, but I would say a minimum of 500,000 in revenue. Leadership is important. There's different metrics and I wouldn't say metrics, but things that you need to be able to represent and do on a day to day in terms of leadership, to keep and mentor and grow your team and help it operate functionally. Operations, learning the ins and outs of how to build processes out, how you serve your clients, reporting those types of things, and leveraging our enterprise service team for the different resources they have as far as onboarding payroll, how do you design compensation for your team, how do you grow your team and hire properly practice management, all that, Some of that falls into practice management as well. But there's defined training that we do. Once you meet the business development qualifications, the path to partner program is around two years long where you've got mentors at the firm. So we've got 60 partners now. So you get various different mentors throughout that two year program covering all of these different metrics and different things that you need to work on and focus on and make sure you've got a good understanding of. And then the end of that two year program you're voted in by the board to partnership.

[B]

So I'm trying to process how this works at least for a lot of larger firms. At the end of the day, clients are clients of the firm and when you become a partner and get equity, you get a piece of the equity in the, you know, the aggregate firm that everybody's collectively shared in. And it sounds like your structure is different because you're at least you're framing it as more in teams. Like I get equity in my client base, my book, my team. Can you explain more of. I don't know if I'm a misunderstanding or if you can explain more of how that works.

[A]

Yeah. So my situation is unique because I came to Mineta and started my own team from scratch. So I have full ownership of my clients. I do not have a non solicit essentially for the book of clients that I have. Some of the other teams have larger, I would say practices that have been around a long time. They'll have a key partner that's been there and then they have a succession of like G2 partners. Right. And so that's structured a little bit different among the teams.

[B]

Right. When you're, when you're internal successoring versus effectively you were. You're like an external successor coming in to solve their internal problem.

[A]

Right? Yeah. And I am, you know, I didn't. There's partners here that have been here since the day they came out of college and so they've been here longer. I'm a little bit unique in that I came in from an outside firm with a book of business and could do the business development and had a desire to start my own team versus joining a larger Morris established team.

[B]

Right.

[A]

And had I joined a larger, more established team, you'd still have ownership in the clients that you have maybe purchased or brought on yourself and have a different arrangement within maybe that senior partner's older book of business. But with mine I started my team from scratch. So every client that I'm essentially serving is my client and I've have ownership of those clients.

[B]

Meaning like no non solicits or restrictions from for you on leaving with those clients?

[A]

No.

[B]

So I guess I'm trying to understand how it works financially though. I mean, are you like, did you buy shares in your, like your individual client base or you still ultimately have shares of the firm and the aggregate and you participate in profits of the firm and the aggregate?

[A]

Yeah. So the way that what I was able to purchase in terms of ownership in the firm is a function of what I'm paying in management fees. So I was capable or able to buy 100 units of the firm that's separate than the interest that I have in my own practice that allows me to participate in profits and distributions from the firm. And then I did a transaction where I purchased the book of business that I was leading those relationships on for that three year transition period at the point that I made partnership. So the firm actually purchased the prior partner's practice.

[B]

Okay.

[A]

And then once I met the partnership goals, I was able to purchase those clients back from the firm.

[B]

Okay. Which effectively means like the firm, you know, the, the firm finance and cash flow to the transaction for you. So you didn't have to do like a big old bank loan or something equivalent.

[A]

Right. And I had the option to do that each transaction. And these transactions are rare, I would say. And each transaction that occurs at Mineta, you know, being it succession planning partners that have worked with a senior partner for 10 to 20 years, those transact might look a little bit different than mine. And that's the uniqueness of what we do at Moneta. It's not a cookie cutter transaction for everyone. But for me, what made the most sense, because the reality is you can't own clients. Right. And so I had to work really hard to secure the relationships I had and take very good care of the clients that I transitioned. But the reality is they can leave. And so I had to really work hard to secure those relationships and then was able to do an earn out for the transaction so that I didn't have to take out a big outside loan in the event that, you know, there's different risks with the capital transaction versus an earn out. So you've got market fluctuations, clients can leave, there's a lot that can happen. And being that I work with those clients for such a short period of time, it made sense for me to do the earn out.

[B]

Yep. So. So if I'm understanding just like the Minetta structure, then you, it sounds like you effectively have like two, two profit streams or two layers. There's like, there's your book of clients, which is some entity structure you own that you get profitability on. At like your level for your clients. And then you pay a management fee to Moneta off your, off your client book for all the overhead and services they provide. But then you also get an ownership stake in Moneta. So to the extent the, to the extent the mothership serves you well and profitably, the profits come back to you as a shareholder in the management company that's providing the services.

[A]

Yes.

[B]

Am I understanding those layers correctly?

[A]

Yes.

[B]

Okay. So you essentially have like, I don't know if it's literally like your own entity for your own client base at your own layer, in addition to the fact that you own shares up the line to Mineta for the management fee that's paid up to them for the services they provide.

[A]

Yes.

[B]

Okay.

[A]

And so that's also unique to each team. So because I was a standalone team, I was able to buy up essentially what I pay in, in a management fee in terms of the amount of shares that I was able to buy. And we have a unique structure that we recast that every three years based on growth or reshuffle that every three years based on growth. So if I continue to grow, I may in another two years have the opportunity to buy more equity.

[B]

Okay. And so at the, like at the practice level, then Moneta essentially bought the exiting advisor and then sort of resold it, allowed you to buy in with the caveat that you had to actually hit the partnership thresholds in order to be eligible to buy the client base. Otherwise you're quote, unquote, you're just going to get to serve it as a salaried advisor. But you don't get to buy the clients in equity and then they gave you a way to buy it with an earn out structure to manage, I guess. So you still have to deal with the cash flow, but you don't have the same kind of giant debt that you do in a capital transaction.

[A]

Right.

[B]

Okay. And so then how long does the earnout lasts? Like how long, how long does this linger over your head before you're like free and clear and just back into a normal. I've completed the transaction run rate.

[A]

Yeah. And so that's a good question. I didn't want this lingering over my head for an extended period of time. So I decided to go as aggressively as I could that I saw fit for the team to where I could still provide the right career path for my team, still invest in the team to a degree that I needed to. So I decided to do that over a six year period of time.

[B]

Okay. Okay. Which for most just typical Valuations on advisory firms. If we can stretch it over somewhere between five and 10 years, it usually cash flow's okay. Slightly higher valuation needs slightly more years in the time window, but you can cash flow it.

[A]

Yeah. And I wanted to get it behind me. So I would say that I wish I could hire more and invest a little bit more than I am right now. But I'm really happy with my team and my team understands all this. Right. They know that I'm a new owner, a newer partner. They understand the long term vision and we've done a great job building this together. I've got great synergy on my team and we're growing. So the whole point of growing too is being able to reinvest back in the team the way that I want to and make those key hires so that I can continue to grow over the next six years versus staying stagnant for six years waiting for the earn out to be done. So I'm really focused on growing the practice and building out and building the team around my clients and creating something that fits my clients needs and continue to grow. And the debt will certainly help you grow. Right.

[B]

It's an interesting motivator that, that, that payment looming definitely, definitely gives you a little bit of a kick to want to grow, grow a little more faster and clear that. That hurdle rate as it were.

[A]

Right. And we've been successful at that. So things are going good so far.

[B]

So I guess I'd love to understand just the sort of like the overall arc of what, what was the revenue base when you actually came in to start this? Right. You brought some. They had a person successoring out. Where was the revenue or assets then and what do they look like today? Fast forwarding five and a half years later.

[A]

Starting out, like I said, I had about 250,000 in revenue maybe that first six months. I did have some successful business development there at the very beginning. And the practice and the client base that I took over was about 26 clients with 450,000 in revenue.

[B]

Okay.

[A]

By the time I.

[B]

That's a like really nice client base. I mean for. It's a lot of revenue per client. Like these were, these were good clients.

[A]

They're great clients. They're great, great people. Great clients. I was fortunate. The partners practice that I took over was a wonderful human being and very supportive and really helped me transition the clients and was excited about. We ended up having really great synergy. But I didn't know him very well, you know, so that was, it was, you know, there was no guarantees on any of this. So I worked really hard to, you know, build a relationship with him, build a relationship with the clients. But starting out, you could say I was at about 700,000 in revenue.

[B]

Okay.

[A]

And today we're doing about 1.6 million in revenue. And so I started in 2020.

[B]

Okay. So it's had a lot of friendly growth that makes that Earn out math probably feel a little bit better. Although I guess they. So you had to do two years to work towards partnerships. So I'm assuming that the, like the transaction trigger didn't actually happen in 2020, it happened a few years in.

[A]

Yep. So I became partner in 2023.

[B]

Okay. Okay. So you're almost halfway through Earn Out. Earn Out Navigation.

[A]

Yeah. And I didn't buy the clients I came in with. Right. And they were.

[B]

Oh, right, right, right.

[A]

Yeah. So they were, they're growing clients and that revenue grew. And then I was able to be pretty successful in the transition for those three years. I worked really hard to do new plans for every client. I told them I wanted to get to know them. I wanted to make sure that I knew all the ins and outs of their life. And I felt comfortable writing a new financial action plan for all of those clients which demonstrated my value, demonstrated what value I could add with planning, and it helped me really solidify that relationship. So I think that was really smart on my part. And then over time, outside assets consolidated, continued to grow, and that's where we're at today.

[B]

And so what does it look like in terms of clients and team today? You said 1.6 million in revenue. What's the client team structure around it?

[A]

So I'm the partner leading advisor. I have a advisor. I have a senior client service manager that will soon be an ops manager, and then I have a client service manager.

[B]

Okay, and how many clients is it now?

[A]

108.

[B]

Okay. Oh, wow. Up from 26 clients. Plus. Plus the ones you were biz devbing. So it's like, it's a lot of new people come on board.

[A]

Yep.

[B]

So you, you noted that, like part of what made this work, you were able to build a, a relationship with the advisor who was leaving, who was, who was very supportive in the transition. So I'm, I just, I'm curious to hear more, like what did he do? Or what did the two of you do to make sure, like, all of these high value clients actually transitions? Because that's just, that's a, it's a hard transition with high dollar clients who know they can go elsewhere and get service. There will be other people who will be asking for their business and you're in a high stakes situation to keep them all.

[A]

I, we, we called and talked to, you know, we did the typical review cadence that we were on and he gradually introduced me to the relationship. I would say, surprisingly to him and I. Clients seem to be relieved that there was a plan. You know, he was about the same age as some of these clients and they knew at some point he was going to retire and there wasn't a plan. And so they were relieved to see that one. Mineta had a plan, I had a plan. And we were here to serve them and build a team around them. So we did a lot of planning and I also built out the team. So prior to me coming on board, there was the senior partner and a, what we would call a client service manager and an ops person. So there wasn't a team. And so we invested and I invested in the team. So hiring an advisor, which actually turned out to be his son, which was really unique. I didn't hire him until he's been with me. It'll be three years.

[B]

So his son didn't become the successor, but you hired his son into the team after.

[A]

Yes.

[B]

Okay. Interesting.

[A]

It is interesting. So he, I got along so well with the partner that I helped retire and did the succession plan with. I admired his values. I admired how he served clients. And as I got two years in, no, maybe it was probably a year and a half, two years into it, it was clear that in order for me to continue to grow, I was going to need to hire an advisor. And so he became a mentor. He's still a mentor. I could call him anytime I need to. And I was talking to him about it and he called me back about a week later and goes, you know, I think my son might be interested in the industry. Would you be interested in just talking with him and me and my client service manager, senior client service manager, soon to be ops manager, who's been with me this entire time, took him to lunch and we just hit it off. We got along well. He has a master's in accounting, had a real desire to learn the industry. He kind of grew up in the industry and so had a little bit more knowledge of it than I think he realized. He started learning about money at a really young age. And so, yeah, I decided to hire him. And he's, he's been with us for three years now.

[B]

Interesting, interesting. So he, he wasn't already in the business. Like that was actually a transition in for him in the first place as well.

[A]

100%. He came from internal audit, has a master's in accounting. And so I developed and trained him and he's been really successful. But no, he was not already in the industry.

[B]

Okay, so. So now I'm. I'm curious to hear more about where all this growth came from. I mean, just in. In the middle of all the rest of the craziness of buying in and transitions and trying to take over from the. The senior advisor like this went from 26 clients to 108. So what else was. Was happening? I guess. Are there other things and how he was supporting the transition, Are there things that you're doing that just makes that much growth come along the way?

[A]

I think we've just been able, I mean, with the target goals for the partnership, I had some really good years of business development. I would say if you look at our average client household with market growth and then being able to consolidate assets and client referrals, we've been able to be really successful since I started. Now, keep in mind, out of the 108, I would say my average household size starting out or the clients that I was bringing on, I probably brought over about 25 clients when I came over. So it was an average per size, a smaller household. But those clients have grown exponentially. I would say those were younger, more affluent, accumulating clients and then client referrals over time. The other thing that was unique, that when I came over to Mineta, another task that I had working at the wirehouse, I saw a subset within the wirehouse of it was basically the department that I started in. It was where if an advisor was retiring or a client wasn't maybe the right size household or wasn't a good fit for a team, there was a department within the firm that they could refer clients to with advisors like myself that wanted to serve clients and wanted to grow and be able to help people. So when I came over to Mineta, I helped them launch a similar type of team within Mineta. So this is called the Mineta Advisory Services team, which I'm really proud of. So it was brand new. There was another advisor that was already on the team that was out in Denver, and then we had another advisor that was here in St. Louis. So while I was starting my own team and starting to bring on my own clients, I also launched that because I had the experience of doing that. And it was a leadership opportunity. And so we started Mineta Advisory Services at the same time. And so what that served for partner teams. And even for some of the teams that have merged into Minetta, they were able to refer clients over to the Mineta Advisory Services platform that would maybe service households that weren't quite up to their complexity or their minimums. And so that grew twofold also while I was in the Path to Partnership program, so we helped launch that. I would say I led maybe 20 relationships over there during that period of time. So some of the partner teams had referred some clients over to me that I was able to help. And so when I became a partner, I was able to buy a portion of those clients. And that Mineta Advisory Services team is doing great. It's a great service within the firm. And it's a lot of young, growing planners and CFPs that want to learn the business but aren't necessarily ready to be partners. And so that's a whole nother division within Mineta that I was able to start. So a few of those clients came from that as well.

[B]

So can you explain more of, of how that works? Like just as an advisor at the firm, if I want to send, send people in, right? So I've, I've got a prospect. It's not a great fit for me directly. It would be nice if the firm ultimately can work with them. So I've got this Manetta Advisory resource. I mean, am I, do I just send them in out of good graces because I want to see them served well and not like thrown back to the proverbial wolves to find their own way. Do I like, do I participate financially? Do I get a revenue share or am I like, selling? Like, is it the equivalent of a partial book sale? Like, how does that, how do the economics work?

[A]

Yeah, that's a great question. So they will typically start the relationship to a degree, right? So answering some of those on, you know, questions in the beginning, determining whether or not it's a good fit for their team, and they'll help transition that client over to a advisor within the Mineta Advisory Services team. And that team will build out the plan, take over the relationship over time. The originating partner advisor may participate in the very beginning, but eventually the Mineta Advisory Services will take the lead with that client. And that's what we want. We don't want to turn people away and like I said, send them out to proverbial wolves, like you said. So this is a good solution within the firm to make sure that people of all varying different complexities have a solution. And that was really successful. I'm really proud of that because I knew it could work. I saw it work within the wirehouse. And Mineta really wanted a solution like that. Some of these teams being a high net worth planning firm, they're not the right fit for everybody. But we needed a solution for the accumulators and some of the retirees and the opportunities we had to serve people. And we want to provide a platform for advisors that want to learn the business and want to grow over time. Book of clients to serve. So that, that really worked out.

[B]

I guess I want to make sure to understand like how do the dollars get, get split? I mean, am I, am I getting paid a business development bonus? Because I brought people to mendement at.

[A]

Advisory so they give a revenue share for a period of time.

[B]

Okay. Okay. So I have some financial incentive to hand off. But I'm not building an annuity stream by. No, it's not a permanent advisory.

[A]

No, no. And we had to design that with the leadership at Minetta, which was an opportunity for me. I've had great leadership and mentorship since I've been here. But that was a huge opportunity for me to learn leadership and to learn the operations and practice management of the firm. Is leading that Mineta Advisory Services team before becoming a partner and that was a huge opportunity and learning to talk to some of the other partner teams about how we were going to structure that and presenting that. And it's been really successful and the partnership's really happy about it and it's grown twofold. And those advisors on that team, you know, they're learning business development, they're bringing on their own clients and they're doing great. So that was actually a tough decision in my career to decide to truly break away from that too. By the time I left Mineta Advisory Services, I think there was eight or nine people on that team. And I decided that I couldn't do the business development and grow the team around the clients that I was able to lead and serve and do the Mineta Advisory Services team. So I succeeded that to another advisor that's doing a great job over there. And then I started my own team officially in 2023 when I became partner.

[B]

Okay, so you noted as well that much of the, much of the growth also came from like referrals and expanded, expanded revenue, expanded asset opportunities from the existing clients. I'm assuming a lot of that is clients that you bought into where there was still more, more opportunity. So can you I guess just share for like it's always, I find a, an interesting and sometimes challenging dynamic when you're coming into someone else's book of clients who have been served a certain way and say, I want to, you know, no disrespect to my predecessor, but I want to do more and go deeper than my predecessor may have. Like, how do you. How did you do that? How did you. How did that play out as you're trying to get deeper with. With his clients and hopefully having him be supportive of this and not. Not feeling like he's being thrown under the bus for you doing more than he did.

[A]

He was amazing in that way and that he acknowledged that he was. We were open and transparent with them. You know, he said, maggie has a great passion for planning. Maggie has a lot of new ideas. Maggie is really good at technology, and Maggie wants to bring some of this to the table. And he did a phenomenal job managing their portfolios. Maybe he didn't go as deep into the estate planning and the tax planning and some of the things that we do now, but we were transparent about that. And I told them, literally I would get on some of these calls and they would say, maggie, what do you think about me retiring in two years? And he had plans in place, but I didn't know them like I wanted to know them, to help them make those types of decisions. And so I offered to write them financial action plans from the very beginning. Now, I probably didn't do as much business development that year as I would have liked to because I spent a lot of time intimately getting to know them. But when I walked them through the new financial plan and demonstrated my value to them, they were excited about it. And I told them my story. I told them my desire to grow the practice, that I wanted to bring new things me to. To the table, that I wanted to make partnership and I wanted to create this vision for myself, the team, and my clients over time. And I think it's really important to tell your clients that because they bought into that and they still to this day support me in that and that, you know, generated referrals over time. But it wasn't me sitting down saying, hey, what's your neighbor's name? Do you think you could introduce to them? Right. It was really natural. And he, he did not take offense to any of it. He was really supportive of it, told me I was doing a great job and really supported me. Mind you, we were going through Covid, so some of these clients had never even been on Zoom calls before. I had a 9 month old in the background or whatever was going on with the family life at the time. So it really worked out well. But I would say there was definitely some things working against us from the very beginning. But it's really think it's really worked out well.

[B]

So can you share a little bit more? I'm just thinking very practically, like, what was the actual process to go out to all these clients and say so and so is retiring. Meet Maggie, like, how did you do it? How did you break the news?

[A]

I would say the other thing that was huge, that made the clients and we got compliments from our clients on how we did that transition. We gave them three years, technically. So those first couple years, he was sitting with me in every single review and explaining to them what my role was going to be over time. And then he eventually, towards that third year, just worked his way out of the relationship. But there was a three year transition period. So it wasn't like, this is your new advisor, see you later. Like I've seen at some other firms. Right. I think that's more disruptive.

[B]

So how did he do the initial introductions? I mean, did you send an email in advance? Does Maggie just show up in a meeting and everyone says, who's this? And he introduces you, how did it work?

[A]

Pretty much like that. He just introduced me to them, told them that over time I was going to be taken over his practice. That you know and I know that I'm eventually going to retire at some point. And this is the plan that we've got in place for you. And Maggie's a great planner and she wants to help you. And then over time, I just earned their trust through great planning and service.

[B]

So what were you doing to try to earn the trust?

[A]

I did the financial action plan. So I redid their entire plan. So that means I walk them through all their goals and objectives, updated all of their modeling, asked deeper questions on tax, tried to solve any problem that they had that was presenting at the time. And then I sat in every review from there on out.

[B]

So how does that get introduced when they've already got existing advisor in the room? Like, I want to do a financial plan. I thought he already did a financial plan for me.

[A]

We tell him that the last time that he wrote because really, if you think about it, you write an original plan for a client and then from then on you do like a. For most, it's a review packet. Right now I would say that he had more of an emphasis on investments. There wasn't as much emphasis on like financial modeling and digging into tax returns. And he organized all their estate planning documents but maybe didn't get into the weeds about how everything was titled. And if that was up to date, if they had new assets, I would say there was definitely some proactive things that I picked up on, but for the most part, it was, I want to get to know you. This is the best way for me to go about it. I'd be comfortable writing a plan for you so I have the opportunity to get to know you better. Because I had a written plan, but I hadn't had all the conversations with them and asked all the questions that I wanted to ask. And most of them were willing to go through that process. Some of them didn't feel that they needed to, or there was not enough complexity to where we didn't need to do that at the time. But I would say a majority of them went through that process.

[B]

And. And financial action plan in your world is just like the label for a financial plan or is that something very.

[A]

No, it's just a financial plan. That's what we call it.

[B]

Okay, and so what's the planning process for you at this point? When you're trying to do new plan, existing client, but not existing client for you? It's kind of new client for you.

[A]

What are your goals today? Right. So 10 years ago, when Carl wrote this plan, this was your goals. You've achieved the majority of this. Right. So what are our goals today? And really, like writing all of that out and then doing all the updated modeling, I would say I introduced Emoney.

[B]

Okay.

[A]

So I wanted a different planning software. I think at the time, some of the teams here were using MoneyGuide Pro, and that's a whole nother podcast. Right. But I introduced some new planning software. I don't think we had a holista plan at the time, but there was just some technology that I introduced and really was able to kind of show some retirement modeling. And then any comment we've got in house estate planning attorneys. So any comments that they had and help to answer their questions.

[B]

And. And so this becomes a big part of the process in the. In the first year or two to start earning trust. Let me actually do a plan for you. I'll take you through E Money. We cry. Your goals today are probably different than the ones you talked about with Carl 10 years ago when you started with the firm. And now they're actually doing some planning work and getting to know you. And you're getting to know them.

[A]

Yeah. And little things. I did my best to never miss an email. Right. I'm sending summary emails following up the Review. He never really wrote out a summary email of what we talked about and just little process things that I think showed some improvement over time. And then we got holista plans shortly after that. So when I was able to offer some tax planning advice and help with.

[B]

That.

[A]

Talking to their kids, that was a huge thing. So there was some proverbial client kids within the practice that were now 35 and 40 years old. And that was a huge value add that we were able to do as well in talking about those things. And for them to know that there's gonna be someone there that's gonna help them transition their assets over time and make sure that that's done the way that they want and someone that can relate and communicate with their kids was a huge value add as well.

[B]

Okay. Because much respect to predecessor, but he was their generation, not the kids generation.

[A]

Right.

[B]

And you speak the kids generation because you're the next generation advisor coming in.

[A]

Yeah. I think that was the first time in my career my age was actually working for me.

[B]

Now, finally, it's an asset.

[A]

Yeah. Now I turn 40 this year. And now everybody told me once you get to 40, all the referrals start coming in and your friends start to actually have money, and some of that stuff starts to work out. And I'm starting to feel some of that as well, which is great.

[B]

So I'm curious what other tidbits. I'm intrigued by these. So let's do an updated plan, because your goals today may not be the ones that you set originally, since you've been here for a decade or more and you've achieved them. Started just doing summary emails after meetings. So a little more documentation and proactive communication, offering to talk to clients, kids, so they've got some confidence about what happens if they're gone. So what. What else?

[A]

I would say just good, solid communication and service and any opportunity I saw to demonstrate my value to them, I did. And I did it over the top. I worked really hard to solidify my relationships with them, and I enjoyed them. There was a natural mix in terms of relationship. The partner that I took over was a really nice, charitable, great person, and so he naturally attracted clients like that. And I think that there was just some good personality fits. There was some that were not right openly. I think there was. I lost two or three clients in the very beginning, and that was hard, but overall it was really successful, and I just really, really serviced them.

[B]

So how did it work or get communicated by the time you're getting two and three years in and now I think you said his name's Carl, like now Carl's. In the later years of this sequence and getting ready to wind out, they.

[A]

Were comfortable with it. By three years they were comfortable with it. And we got compliments that three years was a good enough period of time that they felt comfortable working with us at that point. And a lot of these clients are comfortable with Mineta. You know, some of these clients have been with Mineta for 20 years and Mineta is a world class firm and has done a great job servicing clients. So they were comfortable knowing that there was consistency in the firm as well and the leadership. So I think there was some comfort level with that as well. And they wanted to continue the relationship with Mineta over time.

[B]

Interesting.

[A]

So when you talk about a non solicit, you know, I am in the middle of an earn out, I don't think it would be wise for me to up and try to leave Mineta today. Right. And I can admit that clients have a connection. Yeah, there's a connection to the firm. You can't deny that. And I'm grateful for that because it's nice to actually have a brand that's working for me.

[B]

Because you were at a firm where the brand was a liability instead of.

[A]

An asset both times. Well, the one is, you know, I would say Mineta is an established brand and we've got eight offices and growing in that way. So. But when you, when you hang your own shingle and you've got a brand nobody's heard of, that's tough. Right. You've got to kind of tell that story. I think a lot of firms do it successfully over time and there's certain clients that seek that out. But I do think that having the backing of Mineta, the balance sheet of Mineta and the history of Minetta helped those clients to stay as well.

[B]

And I guess as I'm struck by this, relative to some advisor transitions to next generation advisors where it gets a little bumpy because sometimes the exiting advisor or just sometimes the first generation advisor doesn't fully let go of clients or get out of the way. You add this natural forcing mechanism like Carl is retiring and has a timeline. This, this, this is going to come to an end.

[A]

That made a huge difference. And he did, he helped get out, he got out of the way 100% and he participated in it and he was excited about it and he was confident in me and I, you know, he had to watch me for a couple months. I could tell at the beginning he was a little he's wondering what you.

[B]

Really served his clients well.

[A]

Yeah, but over time I earned his trust too. And like I said, we still, I could call him anytime and ask him, you know, I would call him. Not so much anymore, but for a while. And what did, what happened with this and how did this go and how could I help them? What's their personality, you know, and he was really helpful of it the whole time. But I would say to his credit, he got out of the way and was really supportive and really transparent with clients. And that was the only reason I really was open to doing this. Right. There was a, there was an end date because that can go on. And it's a hard thing to walk away from. You know, to his credit, right, you, you build something over 40 years and suddenly deciding that you're just leaving. Right. That's hard to do.

[B]

You, you make good money. And the client meetings usually aren't that hard at that point because you've known them for a long time and they really like you. It's like you get paid really well to hang out with your friends, your friends who are also technically clients because they pay you like. Yeah, I mean I, I see a lot of advisors of the like, of the founder generation who struggle with this because it's hard to leave or even if you kind of think you want to leave, it's hard to leave when the moment comes and you actually have to cut off. But it sounds like one of the defining pieces here was just Karl really was ready to retire and leave and so he followed and honored that timeline. And then at that point he just wanted to make it work. Well, I'm assuming there were some financial terms that also favored him of client stock. So everyone's aligned in the, in the interests here. And so then it went well because he really actually was ready to get, get out.

[A]

Yeah.

[B]

So, so now as you kind of are at this point where it's, it's your client base, you've started building your team. We're still working through the earn out. But as you, as you noted, you've got a very long time horizon on this. So what comes next? Like, where does it go from here? What do you look at in the, in the years to come?

[A]

I want to continue to grow. I have, I think, you know, I'm at a point right now where, you know, I'm deciding, you know, what's the next hire going to be, how am I going to develop the advisor on my team, what path does he want to take? I've got My long term senior client service operations manager designing this to benefit them over time and design that path for them so that they can, you know, get their self actualization in their careers as well. So growing to keep up with that and then, you know, what's my next hire? You know, I'd like to hire someone that maybe has a little bit more of a niche background that can add value to the team. Maybe a jd, somebody from public accounting, you know, one of those bigger hires or a business development advisor that wants to help grow. So that's kind of digesting all of that, taking really good care of the clients that we have and trying to streamline our processes, which I think we've done a great job of. Over the last couple years I've entertained partnership. I think that's something that I've wrestled with. I listened to that Kitces and Carl podcast on do you need a partner or study group? I think I'm getting to that.

[B]

Partnership meaning whether you want to. A partner? Yeah, you are a partner in Mineta, but like a partner at your team level.

[A]

At my team level. You know, keep in mind there's some teams that have three or four partners and 50 people on their team. So there's different structures at Mineta, which is kind of the beauty of it. So I've seen, you know, what those teams have evolved to over 20 years and just designing to meet that at some point. Is that what I want or kind of entertaining all of that? Right. I don't know. So I've got to kind of decide that. But is a is partnership makes sense for me at this point. Do I continue to go on as a solo partner team? How do I build out my succession over time? Which I know it seems like I'm young to figure that out but you know, is that next hire potentially going to be my succession plan 20 years from now? So those are the things I'm thinking about.

[B]

Are you feeling like you're at capacity now with I think you said 108 clients? The second advisor with you and two team members in support, are you feeling at capacity?

[A]

No.

[B]

Okay.

[A]

No. We strive to have about 50 clients per advisor, so I'm definitely still acting as a partner advisor and we really leverage technology and streamline how we service clients to make it to where we are not at capacity. So we don't have paper in the office. We're using some AI tools for documentation and heavily using Salesforce. Brad or the advisor on my team has done a great job building out processes with technology. So no, I Don't feel like we're at capacity now, but I will probably hire another person within the next year or two to keep up with growth.

[B]

Yeah. So what is the growth pace and where does growth come from at this point?

[A]

So the advisor on my team is doing advisor boot camp in house, so he's starting to do some business development and looking into that. A majority of it comes from me. So the advisor and the senior client service manager, operations manager, do a really good job of organizing and monitoring the clients in house and servicing them. And then I'm looking for opportunities for growth and servicing clients. So I'm doing the majority of business development.

[B]

So what are your biz dev paths? I mean, what are you doing for growth?

[A]

Well, like I said, where I'm at my career right now, I'm getting a lot of referrals. I'm getting a lot of referrals. A strategy that I have is always try to stay visible. And so LinkedIn some of my social media posts, I've won some accolades in the last year or so, word of mouth. There's a lot that I'm doing. I would say I just kind of do a little bit of everything and see what sticks. I don't have like a sound strategy for growth, which I'd like to eventually evolve, but 50% of our growth typically comes from client referrals.

[B]

Okay, so as you reflect back on this journey, like, what's surprised you the most about this path through the advisory business and finding paths to equity and ownership?

[A]

I think the flexibility and freedom I have to be a parent where early on in my career I was growing my business and at the same time growing my family and not really sure if I was going to be making all of these major sacrifices, which I'm not going to say that I don't. Of course I work a lot and I think about work a lot, but I'm fairly present and don't miss much. So when my daughter started kindergarten, I was there in her classroom. If she wants me to come to lunch with her one day, I'm able to go. So I feel like I have a lot of freedom and flexibility to be present as a parent.

[B]

And that was a surprise. You didn't.

[A]

It was.

[B]

You didn't expect it to come out that way.

[A]

No, I perceived at the very beginning partnership and ownership is this grueling task and you're going to work 12 to 12. And I think I saw a little bit of that example early on in my career. And don't get me wrong, I work A lot. And I also don't miss anything for clients. Right. So if they need me to be here at 6 o' clock at night, I make it work. But yeah, I have more freedom and flexibility than I thought I was going to have and I didn't perceive it that way early on in my career. So I think young parents in the industry should know that, that over time it does get easier and you can design your own life, especially in a ownership position.

[B]

There is a weird humor to me in our industry versus I feel like almost any other where I just feel like the conventional wisdom is if you want reasonable work, life balance and some flexibility to be a parent, you find a good stable firm with a good stable salary, job that has good benefits and parental leave policies and you take the stability of the firm so that you can go start a family. And only in our strange world is like, oh yeah, I wanted to have more flexibility and firmware for my family. So I became an entrepreneur and started a business from scratch. It's like really? But I see that a lot in our world. I'd see it a lot in XYPN members who start their firm that it's like, oh, I actually feel like I can have more freedom and flexibility if I make my own business and build it around my life in the way that I want to control it. And I actually can do that more than the, the traditional path of firm with stable salaries and benefits.

[A]

Yeah.

[B]

Strange phenomenon to me.

[A]

Yeah. And I would say, you know, I'm not, this is definitely not a lifestyle practice. I'm definitely geared for growth and motivated to continue to grow the practice. But I do have a lot of flexibility.

[B]

And I was saying the fact that you were doing all this at the same time, I think you said because you had your like you had a baby and then immediately did the transition. Oh, and then Covid happened all in early 2020.

[A]

Yep.

[B]

So how does that balancing work?

[A]

Well, I would say one of the smartest things that I would tell young advisors or really anybody is choose your partner wisely. My partner has been supportive throughout my career and I have an army of people within my life that help support me. So during COVID luckily I had a sister in law that was willing to watch my daughter during the day so that I could still work in the COVID life. So it worked out up.

[B]

Wow, you've got, so you've got family around as part of where you are 100%.

[A]

I have built an army around me to help support me and my family, you know, so that I can grow my practice. Yep.

[B]

So what was the low point in this journey for you?

[A]

I would say the low point would be that first transition, you know, going from the large employee model, lots of shiny things everywhere, lots of camaraderie, to a startup Ria that I wasn't sure I made the right choice at that time. You know, in hindsight, I think it was the smartest thing I ever did. But at that point in time that, that was a lower point. I lost my mom about it'll be two years in January and that, that, you know, she was declining health wise and that was 100% the sandwich generation. You know, I had young kids and a declining parent. She taught me a ton. She was, she was very independent and taught me so much and I miss her dearly. But that was definitely a lower point in my career.

[B]

So I am wondering, you commented like when you went to the startup Ria, you weren't sure you made the right choice. In hindsight, it was the smartest thing. Like what, what made it the smartest thing? What changed between what you thought you were happening at the time and why it turned out to be good after the fact?

[A]

Well, in hindsight, and I have said this and given this analogy before, but it was like a Roth conversion. I kind of perceived it. The sooner I do this and the younger I do this and the soonest I can get to the ability to own my own business, the more upside I'm going to have. Now sitting here, you know, turning 40 this year and having ownership in a practice and having a growing business, it was the smartest thing I ever did. But it was hard. It was really hard. It was hard to digest a whole new way of doing things and a whole new industry and figuring out what was what. And it took a lot of time, but now I couldn't be more happy.

[B]

With where I'm at because getting from the wirehouse world to the startup Ria was what like showed, oh, there is a world where you can have equity and own the thing just doesn't really exist in the, in the W2 employee wirehouse world. Right.

[A]

Yeah.

[B]

So that was the chain.

[A]

And then when finding Mineta and realizing that I had a defined path to partnership and had this opportunity and was able to do that and achieve that and in full. I mean there's not even. I had looked at other RIAs that didn't offer any ownership. Right. So if there's a PE interest in it somewhere, a lot of them aren't offering that anymore either. So it's Strictly salary based. And this was a unique opportunity at Mineta because there's not a lot of other firms that are structured this way. And we are 100% privately owned.

[B]

Which is important to you for being privately owned or just because the fact that they're not, not PE driven means they, they treat their equity a little differently?

[A]

Well, both, I think. You know, I've seen there's a lot of private equity in our industry and I do think that impacts how you're able to serve clients over time and I think it changes the dynamics within the firm. So it was attractive to me that they offered the path of partnership. They were 100% privately owned and there was no PE interest at the time.

[B]

So. So what else do you know now that you wish you could go back and like tell you from five, ten years ago, earlier in your career about the path through the industry and, and what you're pursuing?

[A]

I think just doing thorough research on the firm that you're entering with and making sure they 100% align with your values. I think I have some people that I interview now that know 100% out of college, out of the gate, that they want to work for a fee only firm and have done their due diligence on the firms versus just saying, you know, I want to be a financial planner and joining whatever, whoever will hire them without really investigating what's underneath. I think that's a really wise thing to do today because I do think the industry's changing and has continued to change, you know, even since I originally left.

[B]

So, so where, whereas when you came into the industry as I'm referring, so you, you didn't feel like you knew what questions to ask or what to diligence. And so that impacted where you, where you went and landed.

[A]

100%. Yep.

[B]

So what, what else would you, I don't know, be asking now? Or like, what do you, what do you want to go back and tell prior you that you should have been asking in the interview process?

[A]

I think just understanding the ownership structures of the firms and how they service clients and the paths over time. I mean, of course, now that I know the industry, there's a million questions that I would have asked. But I think there was something about some of those prior firms that struck a chord with me and my values that didn't align and that was not something that was sustainable over time. I think with some of the larger firms, some of the conflicts of interest you see here and there and they pop up and then you're like, man, could I do this for 20 years and kind of not knowing the direction of the firm. I think those are good questions to ask early on.

[B]

So what other advice would you give younger, newer advisors coming into the industry today and trying to figure out their. Their career path or their career and family path or their Korean family inequity path, since those seem to have been very intertwined for you?

[A]

Yeah, I think do business development early. Make sure you learn soft skills and make sure you do business development. Because at the end of the day, the only reason that I've gotten to where I've gotten is because I've got an ability to grow and to bring on clients and to help people. Right. If I didn't have those skills and I wasn't able to do that, I wouldn't be a partner today. And I think early on, the original mentor that I had, the original team that I worked on, and maybe even the platform that I was on, right. There was a eat what you kill mentality. I learned that in order to have full independence, I needed to learn to bring on clients, and I started seeding those relationships really early on. And so even if you get into a role where you're, you know, paid a salary and you're not really required to bring on clients, I think you should still focus on business development and build out your own network and focus on that and learn whatever you need to learn to be able to do that successfully.

[B]

So was that a natural thing for you or. I feel like for some folks like build biz, dev is part of their personality, and for others, it's a skill set you have to spend a lot of time and effort building to figure out how to do. Was it a natural thing for you or was this like. No, I really had to go through all the stuff to learn and figure out how to do it.

[A]

I think it was. Yeah. I do think some of the natural soft skills I learned early on, just with the odd jobs that I had growing up, I was always talking and dealing with people. I think some of the life experiences I've had early on has given me a tremendous amount of empathy and ability to connect with other people. So maybe I had a little bit of an advantage, but I think a lot of it I had to learn. And I just forced myself to be uncomfortable in figuring it out. And I didn't really take no for an answer. So I dealt with plenty of rejection early on, But I had a plan, and I continued to build relationships and network and go to events and to be uncomfortable. And I think that Paid off over time.

[B]

And so the learning for you with this was in the wirehouse environment.

[A]

Yeah.

[B]

So is that still like is. Does that then become a. A path you would recommend to others because that's a good place to learn business development? Or would you. Would you learn or pursue it differently now?

[A]

Well, I. Yeah, I mean, I. Like I said, the training that I had there and some of the business development that I learned and some of those skills there were great. I think as long as you find a firm that has that type of training and development and you ask about it, I think that's. I'm just saying I think that's important. I don't know that you have to necessarily go through a larger wirehouse firm to get that. You just need to make sure to ask for it and advocate for yourself and make sure you're getting that training while also learning some of the technical skills that are important to service and take care of clients.

[B]

So as we come to the end, this is a podcast about success. And just one of the themes that often comes up that that word success means like, very different things, different people. Sometimes it changes for us as we go through our own life journey. So it just seems you're in this wonderful place now for having built the business. You've got the ownership, you've got the equity, you've got the path to. Or not path. Partnership. You've got the partnership. We'll be done with yearn out in a few years. So the business seems to be in a wonderful place now. How do you define success for yourself at this point?

[A]

Yeah, and that's something that I am continuing to evaluate. Being an achiever. Right. It's like you get somewhere and you're satisfied with it for about a minute and then you're on to the next thing. So that's something I think I really need to continue to define. But. But I just want freedom. I want freedom to do the things that I want to do with my family. I want to really take good care of people and know when I sleep at night that my clients are really taken care of and I'm doing the best thing that I can do for them. I want to set a good example for my kids. I want them to see what hard work is and have look up to the hard work that I've achieved over time and maybe ideally pass something down to them if that's something that they're interested in. But at the end of the day, as long as we've got freedom to do what it is that we want and that I know that I've taken good care of people. That's success to me.

[B]

Freedom and taking care of people.

[A]

Yeah, I'm a helper.

[B]

I love it. Yeah, I love it. Thank you, Maggie, so much for joining us on the Financial Advisor Success podcast.

[A]

Thank you so much for having me, Michael.

[B]

Thank you.

[A]

Want even more ideas, tools, and resources on how to break through to the next level of success as a financial advisor? Check out the leading financial planning industry blog, Nerd's Eye View, at www.kitsis.com, where Michael covers the latest practice management trends and financial planning strategies. And by joining the Members section, you can earn IMCA and CFP continuing education credits along with exclusive member content. Get it all now at www.www.kitsis.com.