Ep 028: Scaling Up A $6B Independent RIA Using A Full-Time CEO As Chief Inspiration Officer with Michael Nathanson
Financial Advisor Success
Michael Kitces
4.8 • 696 Ratings
🗓️ 11 July 2017
⏱️ 99 minutes
🧾️ Download transcript
Summary
Our guest today is Michael Nathanson, chief executive officer of the Colony Group. Michael’s private wealth management firm has over $6 billion in assets under management and a 39% profit margin. Michael has driven this phenomenal growth through strategic acquisitions, high-level systems thinking, and targeted organic growth.
Michael walks us through how he operates as an effective CEO to nurture his seven offices, recruit top-level talent, and delegate effectively. He gets into the details of compensation, leadership and buying other firms. He also shares the company’s trajectory and how it compares to other RIA practices out in the market.
Get the full show notes and transcript for this episode at: www.kitces.com/28
Transcript
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| 0:00.0 | Welcome to the Financial Advisor Success Podcast, where you go behind the scenes with financial planner, |
| 0:08.4 | speaker and consultant Michael Kitsis to hear stories of how leading financial advisors |
| 0:13.6 | navigated the inevitable challenges that arise on the path to success and get insight from leading |
| 0:19.2 | industry consultants about how to break through to the |
| 0:22.0 | next level in your advisory business. And now here's your host, Michael Kitsas. Welcome, everyone. |
| 0:29.1 | Welcome to the 28th episode of the Financial Advisor Success podcast. My guest on today's podcast |
| 0:34.9 | is Michael Nathanson. Michael is the CEO of the Colony Group, a private |
| 0:39.2 | wealth management firm based in the Boston area that has nearly $6 billion of assets under management and has managed to systematize its wealth management and investment solutions to the point of driving a whopping 39% profit margin and nearly quadruple the size of the firm in just the past five years |
| 0:55.3 | alone through a combination of both a series of major acquisitions and organic growth across |
| 1:00.6 | multiple niches, including corporate executives, athletes and entertainers, and an ultra-high |
| 1:05.4 | net worth family office division. What's unique about Michael, though, is how he truly functions as a CEO to the |
| 1:13.0 | colony group, whereas he puts it, his primary job is to be the chief inspiration officer |
| 1:17.8 | that sets the vision for the firm, visits with nearly 100 employees across seven different |
| 1:23.5 | locations trying to get them excited about achieving that vision, and crafting a focus |
| 1:28.2 | strategy to attract, develop, engage, and retain the top talent in the industry. |
| 1:33.9 | In this episode, Michael gives us a behind-the-scenes look at how a large independent RIA operates, |
| 1:39.6 | where investment management duties are entirely separated from the wealth managers who may |
| 1:43.7 | help clients select |
| 1:45.0 | strategies and formalize it an investment policy statement, but then let the investment management team actually run and manage the portfolio. |
| 1:52.1 | Where the firm has formalized its career track into a progression from associate to senior associate to financial counselor and senior financial counselor, |
| 2:00.0 | and how the partners have formalized |
| 2:01.4 | criteria to buy units of their LLC entity with financing arranged by the firm. |
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