John Euart of McKinsey & Company - Buzzwords or Gamechangers?

09/05/24 • 53 min

The Fuse Show

This Week on The Fuse Show, Natalie and Brian talk with John Euart, Associate Partner at McKinsey & Company.

Key Takeaways

[04:11] - John’s professional background and what led him to McKinsey and to specialize in industry trends?
[07:09] - As an industry, we have talked extensively about the great generational wealth transfer and also succession planning for the advisors planning to retire by 2035. Considering this, why are we seeing a reluctance among advisors to take action with the younger generation and with their own retirement?
[12:46] - Does John think that advice is becoming more scalable as more private equity comes into the industry?
[13:22] - Does John think that the generational wealth transfer is more of an industry game changer or just a current buzzword or focal point?
[15:28] - How does John think AI use will evolve within the RIA space going forward?
[21:25] - Since AI is such a rapidly evolving feed, where should advisory firms look to invest within the AI space to help them grow down the road?
[22:27] - Everyone’s take on whether AI is an industry game changer or just a buzzword.
[24:53] - How important is it for a client to have a “one stop shop” experience?
[27:23] - Is there a certain section of the financial services industry that is doing a particularly good job of using “coopetition” to their benefit?
[31:23] - Is hyper personalization something we should be investing in as an industry in John’s opinion?
[34:05] - Is the industry doing a good job of building and distributing the tools that advisors need for this type of personalization?
[39:10] - Does John think we are in a bubble with private equity or does he think that its growth is sustainable?
[42:15] - Is it potentially beneficial for some investors to have less liquid investments?
[47:22] - Does John think that the benchmarking against other advisors is really critical?
[50:26] - Is benchmarking a buzzword or a game changer in everyone’s opinion?

Quotes

[08:47] - "Another thing that I’d like to get your thoughts on as well, is that I do think there is a broader consumer preference shift that’s happening. I think it’s being influenced by the younger generations. Younger generations want experience and they are more focused on life goals, as opposed to...growing that nest egg as big as possible, and I think we are starting to see that actually impact their parents and grandparents...I’m seeing more and more older generations start to trickle that wealth transfer and actually...[they often want to] see the impact of that wealth transfer before they pass on." ~ John Euart

[23:15] - "I do believe that you are both right. [Adopting AI] is going to require us, whether you’re an RIA, a consultant, a tech leader or a CEO, to think about work fundamentally differently and to think about our data fundamentally differently...I’ve talked about this many times...I think that Financial Services biggest limitation is actually a data problem. " ~ Natalie Wolfsen

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Compliance Code: 2268-OAT-9/4/2024

This Week on The Fuse Show, Natalie and Brian talk with John Euart, Associate Partner at McKinsey & Company.

Key Takeaways

[04:11] - John’s professional background and what led him to McKinsey and to specialize in industry trends?
[07:09] - As an industry, we have talked extensively about the great generational wealth transfer and also succession planning for the advisors planning to retire by 2035. Considering this, why are we seeing a reluctance among advisors to take action with the younger generation and with their own retirement?
[12:46] - Does John think that advice is becoming more scalable as more private equity comes into the industry?
[13:22] - Does John think that the generational wealth transfer is more of an industry game changer or just a current buzzword or focal point?
[15:28] - How does John think AI use will evolve within the RIA space going forward?
[21:25] - Since AI is such a rapidly evolving feed, where should advisory firms look to invest within the AI space to help them grow down the road?
[22:27] - Everyone’s take on whether AI is an industry game changer or just a buzzword.
[24:53] - How important is it for a client to have a “one stop shop” experience?
[27:23] - Is there a certain section of the financial services industry that is doing a particularly good job of using “coopetition” to their benefit?
[31:23] - Is hyper personalization something we should be investing in as an industry in John’s opinion?
[34:05] - Is the industry doing a good job of building and distributing the tools that advisors need for this type of personalization?
[39:10] - Does John think we are in a bubble with private equity or does he think that its growth is sustainable?
[42:15] - Is it potentially beneficial for some investors to have less liquid investments?
[47:22] - Does John think that the benchmarking against other advisors is really critical?
[50:26] - Is benchmarking a buzzword or a game changer in everyone’s opinion?

Quotes

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Compliance Code: 2268-OAT-9/4/2024

Previous Episode

Innovation in Alternatives with Phil Huber of Cliffwater

This Week on The Fuse Show, Natalie and Brian talk with Phil Huber. Phil is a Managing Director and Head of Portfolio Solutions for Cliffwater, based in their Chicago office. Prior to joining Cliffwater, Phil was the Chief Investment Officer for Savant Wealth Management. He earned a bachelor’s degree in finance from the Kelley School of Business at Indiana University. He is a CERTIFIED FINANCIAL PLANNERTM professional, has attained his Chartered Financial Analyst® (CFA®) designation and is a member of the CFA Society of Chicago. Phil has been featured in a number of notable media outlets, including The Wall Street Journal, The New York Times, InvestmentNews, CityWire RIA Magazine and Bloomberg TV. From 2018-2020, he was named one of Investopedia’s Top Financial Advisors. Phil was also named CIO of the Year by RIA Intel in 2023. Phil and his wife Christie live in the northwest suburbs of Chicago where they enjoy reading, yoga and spending time with their daughter Hannah. He is also a lifelong, die-hard professional wrestling fan. Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNERTM in the U.S., which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

Key Takeaways

[03:47] - Learn about Phil’s background, how he got into the industry and how he ended up focusing on alternative investments in particular.
[06:36] - What inspired Phil to write his book, ‘The Allocator’s Edge?’
[10:17] - In his book, Phil states “that we are living in a golden age of alternative investments.” Why does he think this and what ushered this change into place? Also, what is driving the move of active investing out of the public markets and into alts?
[15:09] - Is technology helping make alternative investments more accessible to investors and advisors in Phil’s opinion?
[23:00] - What should advisors consider when sizing their positions in alternative investments?
[26:23] - What are some other hurdles that RIAs face to get into alternative investments and how might we be able to help them overcome these?
[28:38] - What, from Phil’s perspective, are some of the biggest opportunities that advisors are overlooking in alternative investments?
[33:32] - If Phil could give listeners one key takeaway on alternative investments, what would it be?
[37:27] - If he could snap his fingers and make it happen, what futuristic or sci-fi tool would Phil wish for the most?

Quotes

[16:31] - "Most people don’t view fund structures as technological breakthroughs...[but] I kind of think of them though, as technology, in a way...I think of the ETF as a technology that has really democratized beta...and to bring down costs and increase liquidity, and so the ETFs have now become this ubiquitous fund vehicle that pretty much everyone uses as their default way of gaining market exposure." ~ Phil Huber

[23:18] - "[When allocating to alts] it has to be enough to matter, but not so much that it’s going to introduce behavioral risk into the portfolio or to the end client, so I think there’s a middle ground range there...of 10-30% of a portfolio across alternatives." ~ Phil Huber

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Compliance Code: 2011-OAT-8/8/2024

Next Episode

Stacy Havener of Havener Capital - Growth Through Storytelling

This Week on The Fuse Show, Natalie and Brian talk with Stacy Havener, Founder and CEO of Havener Capital. Stacy Havener has made a career raising $8B+ for new/undiscovered funds that led to $30B+ in follow-on AUM. Prior to finding her niche in raising capital, she was an award-winning writer who dreamed of becoming a literature professor. Ironically, her love of words is one of the secrets to her success in an industry dominated by numbers. Growing up the only girl on all-boy soccer teams, it’s no surprise she’s now a female entrepreneur in one of the toughest “boys clubs.” At the heart of it all, there is one thing Stacy believes in – underdogs. Stacy is the Founder/CEO at Havener Capital Partners, a sales and marketing agency that helps boutique asset managers build, launch and grow funds. Havener Capital is on a mission to level the playing field in asset management by raising $100B for boutiques over the next decade. Stacy holds her Series 6, 7, 24, 63, 66, and 79 licenses and is a registered representative of Compass Securities Corporation. She received her Bachelor of Arts in English Literature from Western Connecticut State University, graduating summa cum laude in 1998. That same year, Stacy was named to both the NCAA and the GTE/CoSida Academic All-American teams for Division III Women’s Soccer and subsequently nominated for NCAA Woman of the Year. Based in Newport, RI, Stacy often spends her mornings walking the beach, sipping a Dunkin’ coffee, and listening to 90’s hip hop.

Key Takeaways

[02:41] - What is Stacy’s “origin story” and how has her soccer background informed her finance career?
[04:18] - What are some of Stacy’s favorite old school hip-hop and rap artists?
[07:91] - How did Stacy make her way into the industry and founding her own wealth management company?
[09:54] - What role does storytelling play in Stacy’s business, her success and her clients’ success?
[16:03] - Why are stories, and words, so powerful in an industry often dominated by numbers?
[19:20] - How should advisors leverage storytelling to better differentiate themselves and communicate their passion?
[22:32] - Concrete examples of how differentiating your business can lead to a lot of growth.
[25:20] - Why does the financial services industry often fall short on marketing efforts and how could we improve as an industry? How cutting edge should our marketing strategies be?
[29:51] - How can small businesses harness a lot of the tools we’ve discussed, in spite of some of the unique obstacles they face?
[33:05] - Where does Stacy think the biggest opportunity for innovation is within advisor marketing, business development and storytelling?

Quotes

[11:18] - "If we really think about it, especially with a new firm, what are we buying? Like in Venture Capital, what are they buying with a startup? They’re buying the people...almost more than anything else, and story allows that connection to occur." ~ Stacy Havener

[17:48] - "Whether we want to admit it or not, the heart buys first and the brain rationalizes that decision. So what story does is it gives you a direct line to the heart [and] to connection." ~ Stacy Havener

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Compliance Code: 2509-OAT-9/30/2024