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.
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