FinServ Bracketology: How to Be a Cinderella RIA in an Industry of Giants

Written by: Kelly Forst

Much like college basketball in March, the financial services arena is experiencing its own sort of madness in the registered investment adviser (RIA) space.

Merger and acquisition (M&A) activity within the industry has reached an all-time peak , and firms are left with no choice but to eat or be eaten.

According to DeVoe & Company’s annual review , M&A activity among RIAs set a record-breaking high of 123 transactions in 2015, exceeding 2014’s record by 37 percent. In fact, the industry saw an enormous uptick in the number of “mega-deals,” transactions that involve sellers with more than $5 billion in AUM. A growing number of sellers is largely driving the uptick in activity as aging baby boomer firm owners seek retirement. This trend is expected to continue, and it’s possible we could watch the consolidation of the RIA space unfold before our eyes.

It’s now up to you, the RIA, to adapt or perish. How can you ensure your firm stands out in an industry of giants? Candidly, the average RIA can learn a great deal by taking a page or two out of the college basketball playbook. Will your firm eke out to become the next Cinderella story?

Here are three tips to improve your chances:

1. Go full court press on content:

Having a blog and utilizing social media to share content is no longer optional. Social media not only encourages interaction and communication with clients, it allows RIAs to meet new ones and stay in touch with industry news. It should also go hand-in-hand with your blogging strategy. A well-thought-out blog should serve as a hub of activity that drives thought leadership and steers traffic to your site. Not sure where to begin? Follow these 5 blogging commandments for financial services firms to get started.

2. Make recruiting part of your game plan:

Just as coaches need to spend time scouting fresh talent, the advisory industry needs to follow suit as the adviser workforce ages. As baby boomers get older, there’s a huge opportunity to hire young talent entering the industry. RIAs need to spend time recruiting to stay ahead of the curve by attracting and retaining younger advisors. It will also help serve millennial clients, as they continue to represent a growing market in financial services.

3. Hop on the bandwagon:

Are colleagues, competitors or others in the industry attending or speaking at an upcoming event? Make sure you’re there too – there’s no better way to keep an ear to the ground while having a voice in the conversations that are shaping the industry. More than that, use headlines to your advantage and make your voice heard. Take for instance, why Gregory FCA clients are keeping a finger on the pulse of the election to know how candidates’ positions will impact their businesses. Being able to jump into the news cycle or a conversation about trending topics will set your RIA apart from the pack.

If RIAs want to survive in an environment of accelerating consolidation, they need to better prepare and adapt to the future industry landscape. It’s time to dance.