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Fastest-Growing RIAs Add Twice as Many Assets from New Clients

While firms of all sizes experienced growth, the fastest-growing RIA firms paired referrals with comprehensive marketing strategies, attracting new client assets at 2.4 times the rate of all other firms, according to a new study.

Charles Schwab’s 2017 RIA Benchmarking Study also found that independent financial advisor firms are increasingly attracting high-net-worth investors, with average client relationship size reaching $1.8 million in 2016, up from $1.6 million in 2015.

“Independent advisors are continuing to succeed for two important reasons,” said Jonathan Beatty, senior vice president, sales and relationship management, Schwab Advisor Services. “First, high-net-worth individuals with the most complex financial needs are increasingly seeking the independent model and secondly, within firms of all sizes, advisors are making the right strategic decisions to help them retain their valued clients, win the trust of new clients, and expand and scale their businesses.”

Meanwhile, firms of all sizes have thrived over the past five years, as the median firm AUM grew to $593 million in 2016 from $358 million in 2012, a 10% compound annual growth rate (CAGR), the study shows.

In addition, profitability remains strong, with standard operating margins of 25% in 2016. Median revenue at these firms grew at a 9% CAGR to $3.5 million in 2016 from nearly $2.3 million in 2012, while the median client size grew at a 5.2% CAGR from 266 in 2012 to 357 in 2016.

Similar to last year’s study, advisors across the board identified client acquisition via referrals and planning initiatives as top strategic priorities and drivers of growth. At the fastest-growing firms, existing client referrals and referrals from centers of influence (COI) guided 5.8% of new asset growth, while referrals collectively drove 2.7% of new asset growth for all other firms.

Among the strategic priority rankings that advisors intend to implement to foster growth:


  • Acquire new clients through client referrals: 42%

  • Acquire new clients through business referrals: 30%

  • Enhance strategic planning and execution: 30%

  • Improve productivity with new technology: 27%

  • Recruit staff to increase firm’s skill set/capacity: 22%

  • Improve satisfaction for existing clients: 19%

  • Improve productivity using process changes: 15%


The report further emphasizes that the fastest-growing firms not only exceed at winning new assets through referral sources, they also accompanied new client acquisition with additional marketing activities such as networking, community involvement, website presence, and seminars and events. These activities helped drive an additional 3.6% of new asset growth.

For the fastest-growing firms, the report shows a median of 31 new clients in 2016, more than 1.5 times as many as all other firms, and a median of $45 million in AUM from new clients, compared with $23 million at all other firms.

Firms also continue to focus on talent acquisition. The report shows that 96% of firms with over $1 billion in AUM plan to add relationship managers or investment professionals in 2017. The percentage still stays high at more than 70% for firms with AUM between $250 million and $1 billion.

Fielded from January to March 2017, the study contains self-reported data from 1,321 RIA firms representing more than $750 billion in AUM.

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