Welcome back to the Alt Goes Mainstream podcast.

Today’s episode digs into how the CIO of a growing multi-billion dollar wealth management firm thinks about customization and differentiation by building out private markets capabilities.

We sat down with John McArthur, Senior Partner and CIO at $3.6B AUM Krilogy. Founded in 2009, Krilogy provides comprehensive financial planning and investment management services to HNW individuals, families, and business owners.

Krilogy is charting a growth path — and to chart a growth path, John and his team are thinking about how they can thoughtfully grow their business.

With John at the helm as CIO, they have been strategic with their approach to private markets and have increasingly focused on ways that they can create customized and differentiated solutions for their clients.

John took 11 years of experience in wealth management and financial planning at A.G. Edwards & Sons and Morgan Stanley Smith Barney to Krilogy, where he joined his former University of Missouri college football teammate, Kent Skornia, to help quarterback Krilogy and their clients to financial success.

John is thoughtful in his approach to private markets and how to provide solutions to their clients. We had a fascinating discussion about how wealth management is evolving and how private markets are critical to growing a wealth management practice. We discussed:

How John and team have grown and scaled an independent wealth management firm.
How John approaches private markets — and how that approach has evolved as they work with clients of greater size.
How to balance customization and differentiation with scale.
How can asset managers effectively educate and provide solutions to the wealth channel?
What’s still missing from private markets solutions for the wealth channel?
His views on product innovation, including evergreen funds.
Advice John would give to wealth advisors looking to invest in private markets.

Thanks John for coming on the show to share your wisdom and expertise on wealth management and private markets.

A word from AGM podcast sponsor, Ultimus Fund Solutions

This episode of Alt Goes Mainstream is brought to you by Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. In an increasingly sophisticated financial marketplace, investment managers must navigate a growing array of challenges: elaborate fund structures, specialized strategies, evolving compliance requirements, a growing need for sophisticated reporting, and intensifying demands for transparency.

To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. Ultimus offers a wide range of capabilities across registered funds, private funds and public plans, as well as outsourced middle office services. Delivering operational excellence, Ultimus helps firms manage the ever-changing regulatory environment while meeting the needs of their institutional and retail investors. Ultimus provides comprehensive operational support and fund governance services to help managers successfully launch retail alternative products.

Visit www.ultimusfundsolutions.com to learn more about Ultimus’ technology enhanced services and solutions or contact Ultimus Executive Vice President of Business Development Gary Harris on email at gharris@ultimusfundsolutions.com.

We thank Ultimus for their support of alts going mainstream.

Show Notes
00:00 Introduction and Message from our Sponsor, Ultimus Fund Solutions

01:54 Welcome to Alt Goes Mainstream

02:06 Introducing John McArthur

03:51 John's Journey into Wealth Management

04:23 The Role of Sports in John's Career

05:47 Lessons from Big Wealth Management Firms

06:21 Krilogy's Growth and Strategy

07:25 Challenges and Opportunities in Wealth Management

07:36 Private Markets and Customization

08:04 Growth Strategies and Quality Control

09:29 Client Service and Organic Growth

11:26 Differentiating Wealth Management Offerings

12:23 Importance of Private Markets

13:14 Creating Customized Solutions

14:53 Educating Advisors on Private Markets

15:54 Volatility and Market Changes

17:04 Private Markets in a New Economic Environment

17:24 Building a Diverse Private Fund

19:50 Client Understanding of Private Markets

20:25 Educating Advisors and Clients

22:15 Behavioral Bias in Investing

23:42 Long-Term Investing Mindset

24:08 Compounding and Diversification

24:41 Challenges in Advisor Education

25:46 Effective Education Strategies

27:01 The Role of Storytelling in Education

27:22 Future of Education in Wealth Management

27:35 Sourcing and Access in Private Markets

28:46 Networking and Building Trust

29:26 Customization and Differentiation in Wealth Management

30:34 Combining Big Brands and Niche Funds

31:47 The Importance of Being in the Game

32:13 Advice for Wealth Managers

32:24 Evergreen Fund Structures

33:16 Navigating the Evergreen Environment

34:29 Portfolio Construction in Private Markets

35:25 Operational Benefits of Evergreen Funds

36:05 Model Portfolios in Wealth Management

36:53 Favorite and Contrarian Investment Ideas

38:49 Real Estate Market Opportunities

39:09 Large vs. Niche Real Estate Managers

39:52 Conclusion and Final Thoughts

Disclosure from Krilogy

Investments involve risk and unless otherwise stated, are not guaranteed. Past performance is not a guarantee of future results. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed herein.

Editing and post-production work for this episode was provided by The Podcast Consultant.

Krilogy's John McArthur - charting an RIA's growth path by building out private markets capabilities

Alt Goes Mainstream: The Latest on Alternative Investments, WealthTech, & Private Markets

Krilogy's John McArthur - charting an RIA's growth path by building out private markets capabilities