My guest on today’s podcast is Scott Hanson. Scott is a co-founder in Hanson McClain, an independent RIA based in the Sacramento area that manages nearly $2.5 billion of assets under management for nearly 4,500 clients, most of which are telecom and utility workers.
What’s fascinating about Scott’s firm, though, is not merely that they managed to turn a niche in working with Pacific Bell retirees into a mega-RIA, but how their steady focus on reinvesting into marketing has allowed Hanson McClain to build an advisory firm where none of the advisors are responsible for their own marketing and business development, and instead can focus entirely on serving their clients – which in turn has led Hanson McClain to achieve a stunningly high Net Promoter Score of 85 with its clients!
In this episode, we talk about how Hanson McClain markets itself, what it took to get established in their initial niche working with Pac Bell employees, how they expanded successfully into marketing with a call-in radio show (although Scott isn’t very upbeat on the potential of marketing through radio today!), why direct mail for seminars and other marketing events still works for business development, and the depth of the marketing team that Hanson McClain maintains to sustain its growth.
In addition, Scott shares his own journey as an advisor, from starting out at a financial-planning-centric life insurance firm, to transitioning to work at an independent broker-dealer while building his hybrid RIA, why he eventually decided to let go of his FINRA licenses to focus solely on the RIA, and the challenges in managing and maintaining growth in an ever-larger advisory firm.
And be certain to listen to the end, where Scott shares why he decided with his partner to sell 70% of Hanson McClain to a private equity firm – despite the fact that he thinks the firm can grow to double or even quadruple its size in the coming years – because ultimately, the reality is that growth requires cash, and in the end it can still be a better deal to own a smaller slice of an ever-growing pie… and have the benefit of taking a few chips off the table as well!
And so whether you’ve ever been curious to know how a startup RIA ultimately grows to become $2.5B under management, are looking for marketing ideas and perspective on the benefits of having a radio show, or simply want to understand why an experienced and successful advisory firm would decide to sell to private equity (even when there’s no desire to retire), I hope you enjoy this episode of the Financial Advisor Success podcast!