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Malcolm Lui:
Welcome to the High Value Sales Show of Eversprint.com. I'm Malcolm Lui, the Managing Member of Eversprint, and today we're speaking with Ron Carson, the Founder and CEO of Carson Group, a fintech, consulting and retail advisory firm . Welcome to the show Ron.

Ron Carson:
Hey Malcolm thank you for having me.

Malcolm Lui:
Ron, you grew your company's revenue from $34.8 million in 2014 to $71.3 million in 2017, a 105% increase, and in 2018 you hit around $106 million. Before we talk about how you grew your company so fast, can you briefly share what your company does beyond my quick intro, and how your company differs from the competition?

Ron Carson:
I sure could and you might find it interesting. Malcolm I actually grew up on a farm just north of here and so I started this was zero revenue out of my college dorm room. But what we are today is fintech. We develop technology to make the complex simple for financial advisors so they can do it for their clients. Then we also have a consulting firm we consult with about 5000 advisors around the country. On growing their business more efficiently and we help them all the way. H.R. issues the tech issues to you know how to market and how to structure their their business. And this also is a really valuable because it gives us truly everyday real time intel from the trenches and then we have Carson Wells which is our retail RIAA and we have run 19 locations maybe 20 now in the US

Malcolm Lui:
Great. Now in terms of a percentage of revenue how much of your business comes from fintech consulting and retail advisory

Ron Carson:
So the fastest by far growing part of our business is really are our fintech offering. It is and I don't have a broken down as a percentage in some of these are intricate and truck connected

Malcolm Lui:
Okay.

Ron Carson:
It you know the success on the retail allows us to have credibility with our fintech offering and our coaching Consulting Group helps us really identify people that might be a good candidate to actually join. We're calling it a movement Malcolm. This is about something bigger than just building a business. It's about helping advisors add value beyond a doubt. And today I think is super interesting that most financial advisory firms are not growing because they're having a they're having a hard time demonstrating to their clients why their fee is justified and those that can do that are growing super fast right now.

Malcolm Lui:
Right. So your of the three cogs of your machine and it emitted it interrelated so it kind of grow on each other. Wouldn't be the same if when one bit was missing

Ron Carson:
Yeah so I started the retail business in nineteen eighty three and because of that success and 93 I started our consulting group because of that success. People wanted to know how on earth me being in Omaha Nebraska was I was doing so well and then in 2012 we decided to divest we looked for technology to do what our clients were asking for what we wanted it to do and so we developed really technology if you think about some of our partners like a Fidelity T.D. Ameritrade or Ryan. They spent billions of dollars but it's almost like the old VCR flashing 12:00 you know no one's getting anywhere close to the capabilities. So we spent a lot of our made a lot of our investments around getting the most out of our partners technology in a in a single saw a single pane of glass experience for the consumer

Malcolm Lui:
Right now on the FinTech side. Can you give a little bit more details as to what your fintech offerings are to the advisors

Ron Carson:
Yeah. So our fintech it's what's interesting. And by the way for your listeners there's an interview that Jeff Bezos did at the Washington Economic Forum last October. It's one of the maybe the best interview on just ideas on how to grow your business and what you should be thinking about. But what we do is imagine this single environment where you put in one piece of data might come and you never have to put it in again. Nothing here I go to the Mayo Clinic every year every year 20 some years I've asked my date of birth I go it's never changed and to make things worse they make me put it on six or seven different paper documents drives me crazy how inefficient that is and I'm paying for that as a client and they're also wasting my time.

Malcolm Lui:
Yet.

Ron Carson:
So in a world where once your date once even as a prospect you put you give us a piece of information we're never gonna ask for it again unless it change certain things don't change. Normally a people's name doesn't change their children's name don't change or spouse. Sometimes they get rid of us spouse but that's a whole other story and stuff. This information all talks with one another it talks with you know opening accounts measuring risk in your portfolio. I go back to the base those comment because we're actually this ecosystem where we're adding in the layering in additional capabilities. We're already talking about things we'll be adding in 2020 but also at the same time we're keeping you know where this technology is very high HQ and I call that something we coined. Carson adaptability quotient because none of us can imagine and the average advisor has no idea what technology is going to become available. So we put a lot of effort on remaining adaptable with clean data and data warehouses. But this is technology that will do everything from compliance marketing asset management the comprehensive planning through subject matter experts so their clients and advisors can go to the single we call it single source of truth and and really have their whole wealth not financial life but their whole wealth life in an easy to understand easy to see portal knowing exactly where they are at knowing things are continuously happening proactively for them behind the scenes.

Malcolm Lui:
So you agree a business really rapidly. Thirty five million in 2014 to one hundred and six million. Four years later. So you almost tripled your business in four years. What were the drivers behind that growth.

Ron Carson:
You know I. So we are in Omaha Nebraska. Could people all the time I was doing an interview from a guy from the Bay Area today and I said once I get you here you'll love it because we are the center of the universe that we you know people always say people but having the right culture you know if you don't get the culture right. You know Culture eats strategy for lunch. You can have the best laid plans but if you can't get real people behind it willing to give it their all even when it's not convenient for them to do so it's gonna be it's gonna be very difficult to exit. So I say no one's culture. Number two you know we're providing a service that others are attempting but nobody has figured out how to integrate it the way we have. And we've been very fortunate and the development teams that we work with because they have strong business understanding as well. And Malcolm I'd say the third which I think has only recently become a huge advantage for us but I'm not building this firm to sell it. I want to I want to have one hundred year firm I've got the next but I know the next generation of succession. I'm relatively young at 54 and I can see succession even after that and the handful of people that compete against us there publicly they're out there building it to sell. So advisors and then the clients they serve don't know who they're who they're actually going to be owned by which I can give some pretty good certainty. So if you think about those three items I think it's it's what's really propelled our growth

Malcolm Lui:
Right. So first item having the right culture where you can have people hundred percent behind that strategy and giving it their all to accomplish it. The second one you're providing a service that no one else has done before so you have a bit of a first mover advantage and advantages that be right to describe it.

Ron Carson:
Yeah that would be very accurate we got people have started to copy us and I know a every day I wake up I think of as the day one company and I wake up paranoid

Malcolm Lui:
Right.

Ron Carson:
And I asked my team to do the same thing. So no we we we I'm absolutely very aware of the fact that hey we had a first mover advantage but people can catch up very quickly today.

Malcolm Lui:
Yep. So he had trouble sleeping from from your paranoia

Ron Carson:
Not at all. I hadn't even since I've been a kid. I pass out like I'm on a call my I've never had a sleeping but I only need I only need about six six and a half hours a night but I rarely wake up to an alarm clock. There's a great book out there by Professor Moss from Columbia University called Power Sleep. I read it when I was thirty six years old. And it revolutionized the way I rest

Malcolm Lui:
Yeah I envy my boy because he could sleep just switch it on. He's asleep right. It doesn't matter where we are. I'm thinking man I guy so efficient. Right. He gets those off just like that whenever and then wake up just like that. No. No trouble sleeping for him. You can do

Ron Carson:
It.

Malcolm Lui:
That. I think

Ron Carson:
Oh

Malcolm Lui:
You have a leg up.

Ron Carson:
And let me just make a comment. I think personally as a CEO that's also been a huge advantage for me as I've protected my sleep you know and everybody listening to this has a different requirement. And I look at what my REM is. My deep sleep every single morning. And if it's not where it needs to be you know I adjust things. But having having a restful body allows me to be a lot more creative. And I also practice transcendental meditation. And I know there's lots of different meditation out there but I strongly recommend it. You know it's hard for type A personalities to take to slow. I always say slow down to speed up. I do these Ron sends videos so I put two or three out a week in or around these little tidbits. But I got a ton of feedback on that when Malcolm is just slow down to speed up and allow your creativity to flourish. And I've had a lot of people try it and they've had tremendous success with it

Malcolm Lui:
Yeah I can hear. I can see how slowing down to speed up makes sense. I mean this from a practical perspective. Do you think a bit more slowly you can get the process nailed down and then you can speed it up and execute a process that's that's optimal fast. Right as opposed to just trying to get something quickly and doing it at the worst possible way.

Ron Carson:
Yeah. And I and as we consult with business owners around the country they're all living in such a hard whirlwind that they rarely can emerge and look down on their business. They're just so sucked into it that you know they can't they can't see the obvious. I'll share a quick story it's you're grown up on a farm overnight. We'd leave our equipment out in the field one particular night. We came back and our truck had sunk full of soybeans that sunk down. My dad tried to pull it out with the combined broke some chains we'd go to town. We've got a four wheel drive tractor. We're having a hard time getting this truck out. One of our neighboring farmers pulls up on the road and says Why on earth are you guys trying to pull it out. Why don't you just pull that wagon up empty the grain into it and then just drive the truck out. My dad is like Oh my God I feel so stupid. So

Malcolm Lui:
Yeah.

Ron Carson:
What we were spending hours doing and turn up chains and equipment someone out from the outside it took you know literally five seconds for them to provide a solution for us

Malcolm Lui:
Yeah. Sometimes having a fresh perspective can give you a solution that you never even thought of. And it's shocking right. Kind of hit yourself on the head and go why don't I think about that first.

Ron Carson:
I some of my big US whores have come from people that you know we don't need new landscapes. We need new eyes. We need different views on the same thing too you know to see to see around our blind spots

Malcolm Lui:
Oh yeah and I'm sure you've seen it as an investment manager right. There are hundreds if not thousands of ultra successful businesses and they're not all startups that came up some brand spanking new idea right. Many of them most of them are are existing businesses they've been around but they just found a better way of doing the same thing that everyone else has been doing. But in a different way that works better

Ron Carson:
Yeah. I would you bring up a great point. I mean yeah you can have a startup but today I mean service in our economy is just awful. So if you just show up and provide good service you're gonna be ahead of most in care you're gonna be ahead of the rest. And also get in a mindset where you're not defending what you know and what you're comfortable with but every day I think of yourself as a day one company I don't care how old your company is and re-evaluate it with all the new information that we have or in they experience age information age and just being you know having an open mind and just imagine the art of the possible. I think for those that do that and execute well there's never been a more exciting time to be alive and to be an entrepreneur.

Malcolm Lui:
Yeah. LEGERE agree with you. Tons of opportunities out there just have to see it. So the third driver you mentioned about how you build your company and not to sell it but to have it continue on you know decades or centuries beyond you. How does that change how you do your business how you grow your business

Ron Carson:
So if I were first of all not just for the listeners you know Wall Street I've learned over my career. Wall Street in my opinion continues to take advantage of everybody even the sophisticated and they have no idea. And just because it's legal doesn't mean it's right. So our whole value proposition is centered around putting the consumer first always. Now in order to do that you've got to make big investments. You've got to be totally transparent. You need to be able to show value beyond a doubt you need to be able to make the complex simple. So these are all things that that you know if you don't if you don't do it you're not going to be in a position to really serve people well being able to take a long term view not having to worry about quarterly earnings because we're not publicly traded not having to worry about an exit because we need to get our earnings and cash flow. We're looking at this. It's amazing and this is why I admire fidelity fidelity is owned by the Johnson family. Fidelity is in my mind one of the greatest corporate citizens the the world has because they've done I think so much in other areas that people don't even know about. But they're a private company. They get to take a long term view. They don't have to be on this on the short term treadmill and suffer from short termism short termism as a condition where you do what you do in the short run for immediate gratification at the expense of what you is a long term benefit and the company you know politicians suffer from this. And so do publicly traded companies because of reporting earnings every quarter.

Malcolm Lui:
Right. Yeah I can see that for sure lets you play the long game much more easily which most people are playing so and we have also less competitive space as well. So in terms of 2019 you know what. What's the biggest opportunity you see and what obstacles that their team need to overcome to achieve it.

Ron Carson:
So the biggest opportunity by far if I if I set the stage for financial services is there's a shortage of financial advisors in in the mid 90s. There's roughly a half a million today there's two hundred eighty eight thousand of the two hundred eighty eight one hundred eleven thousand of those are expected to retire soon and I say soon it'll be around a bear market or dramatic regulatory change which we almost had had Trump not won office we would have had called the deal well rule which would have forced a lot of businesses just to decide to get out of the business. And so for 2019 I like to think your business businesses had this tremendous growth but the game hasn't even started yet. You know using a baseball analogy we're not even a first pitch of the first inning. You know they're just we're just arriving at the stadium and we got the bags and started to get the equipment out. And so the focus for Carson is continued to build in our ecosystem. You know banking capabilities legal docs I mean things that I know are pressure points for the consumer where they could have it done with top tier of subject matter experts knowing that there's proactive ness going on behind the scenes so 2019 2020 will be around us continuing to add capabilities to the services that will allow value beyond a doubt for the consumer. Think of Amazon. Amazon has done. No one thinks twice about renewing their prime membership. You know I see. I saw Amazon delivering packages to my house on Easter

Malcolm Lui:
Right.

Ron Carson:
Didn't see that eggs U.P.S.. I mean they're they're disruptive force because they're doing what other companies won't doing do. They're making the complex simple we get value beyond a doubt. So we want to we want to allow clients in wealth management and financial services I have an Amazon like experience so a 19 and 20 were my Nike focused on building out additional infrastructure

Malcolm Lui:
Okay how but in terms of marketing and sales what challenges do you see there in terms of growing your advisor base growing your investor base and raising

Ron Carson:
That

Malcolm Lui:
Its

Ron Carson:
That's probably I don't want to jinx myself by saying this but I mean we had a fantastic marketing department to begin with and then I acquired or I Carson acquired a marketing firm last year called Mineral interactive. So we added about another 30 marketing people these are riders Web site developers and in some in some case where we are generating a lot of unique subject content every single day. So marketing. Well I mean we'll generate thousands of leads. High quality leads for our partners to actually work with with retail clients and on sales. I mean we are we actually have more people today that want to do business with us I mean if you said today if you had an advisory firm Malcolm and you wanted to join us I couldn't we couldn't even begin. We call it a transformation process until September. So

Malcolm Lui:
About

Ron Carson:
We've got a nice backlog. So you know sales is not it's not our it's not our bottleneck it's but it's properly transforming advisors and their business into the Carson ecosystem

Malcolm Lui:
Right. So when you're saying you can't help advisors come onto your platform in December that you're talking about getting them into your being able to use your eco system right.

Ron Carson:
Yeah. In September like if someone signed today they couldn't even start the process until September of this year

Malcolm Lui:
Right now when you say someone you think about the individual financial advisors or you two met there they're firms

Ron Carson:
Their firms their

Malcolm Lui:
Like

Ron Carson:
Firms. But most of the firms well I shouldn't say that was going to say most of them are owned by a single advisor. But but anymore I mean the last several we've done I've had 2 3 and 4 owners of the firm. So it is it's the entity that becomes a client of Carson although if a small there's an adviser out there that's on his own has a. Small amount of business you know under 100 million in assets. We actually we we we have them join an existing office so they're in some cases it could be an individual advisor

Malcolm Lui:
Right now. Earlier you said something along the lines of There's like four hundred thousand known would share and I think that's now two hundred or so thousand advisors right now right. I think that's what you said.

Ron Carson:
Yeah. In

Malcolm Lui:
Yeah

Ron Carson:
The mid 90s or as roughly a half a million financial advisors. And today it's two hundred eighty eight thousand of the two hundred eighty eight one hundred eleven thousand are expected to retire fairly soon. And so it's a little bit like you know I have a concierge doctor who I love but he's not taking any new clients and my dad's doctor retired recently and he had a heck of a time finding a doctor and we have the same dynamic that's going on. You don't think about how many more people we have than we had in the mid 90s think about how much more wealth there is that we have.

Malcolm Lui:
Yeah.

Ron Carson:
The nice thing about the additional complexity to navigate today versus the mid 90s that's that's why we're so excited about the opportunity because we believe we can provide the best experience at incredible at incredible scale

Malcolm Lui:
Right now. So they're two hundred eighty eight thousand advisors out there how many advisory firms are employing those two hundred eighty eight thousand. You reckon

Ron Carson:
Roughly. There's roughly 50 thousand firms out there. So think about how inefficient that is. We don't need 50 thousand marketing departments 50 thousand compliance departments 50 thousand trading or research departments very very small. No one has name brand recognition. No one has any meaningful percentage of the market and we think because a because our our focus is being consumer advocate sitting on the same side of the table as a consumer we think we're going to be able to consolidate much of the profession with advisers that think the way we do that want to want to be client focused

Malcolm Lui:
Right.

Ron Carson:
So focused not product

Malcolm Lui:
You've actually got a nice chunk of that market because I think earlier you said you're consulting to 5000 advisors right now with advisory firms or individual advisors.

Ron Carson:
Yes.

Malcolm Lui:
You think

Ron Carson:
So on our consulting side we have 5000 advisors that are that pay us a monthly retainer. And we. But we have alumni the numbers if you take existing and alumni people that have been too are used our services because they'll come in and out when they have a need.

Malcolm Lui:
Yet

Ron Carson:
Good point. We've got about you know we have a relationship with about 10 percent of the market. On the other side though on the we're we're actually providing all the services not just telling them what to do. We're actually doing it forum. That's our fintech

Malcolm Lui:
Yet

Ron Carson:
And that is I mean we have less than one half of 1 percent and nobody really has more than one half of 1 percent. And think about what happened in banking Malcolm in nineteen eighty four there was fifteen thousand banks and no one really owned any percentage of the market today. For banks control more than 50 percent of the market.

Malcolm Lui:
Right. Yeah but that banks are going way back. Vendor laws that prevent them from going across states right. Once those regulations are lifted it allowed for a lot more consolidation right.

Ron Carson:
That's correct. We are want to happen anyways. I mean it happened in accounting

Malcolm Lui:
Yep.

Ron Carson:
And in the other you know the other thing I would share is how quickly I was on a call we saw in blockbuster video in our portfolios and I remember that someone is talking about this upstart Netflix was it a real was that a real competitor

Malcolm Lui:
Yep.

Ron Carson:
And they left and I said now they sense these days or scratch and I can relate to this because I was an early adopter of Netflix

Malcolm Lui:
Yeah.

Ron Carson:
But they did the mistake people make when they look at their competition they look as they are at the moment not where they're moving to

Malcolm Lui:
Yep.

Ron Carson:
An arc Randolph the co-founder of Netflix actually brought him into one of our meetings and did a CEO roundtable with him he was talking about the fact that they tried to sell themselves some blockbuster and they basically got laughed out of the building

Malcolm Lui:
Yeah.

Ron Carson:
And people were resting on the fact of their going to want to go there go to one of a great experience not so that's why small companies can disrupt big companies because they're nimble and they have that a Q adaptability quotient which

Malcolm Lui:
Yeah

Ron Carson:
Netflix dramatically changed its offering its pricing they developed a lot of their own content and we know what a success story that was and Blockbuster filed bankruptcy and from their peak to their demise in about six years

Malcolm Lui:
Yeah. Yeah. Netflix is this offers I can be in fact you're right that blockbuster doesn't have when they run out of your titles that you want.

Ron Carson:
Within they save time right time you don't have to go anywhere you don't have to go and you ought to be disappointed you get what you need

Malcolm Lui:
Yeah.

Ron Carson:
And that's where Amazon is brilliant my daughter is just telling me that hey dad I order my groceries I get it the next day the time that Amazon gives me is incredible

Malcolm Lui:
Oh huge

Ron Carson:
Though that that value beyond a doubt

Malcolm Lui:
Yes. I mean why go to the store and buy something that's gonna suck up an hour of your time. And if he just wait two days he could be at your doorstep and it's

Ron Carson:
Or

Malcolm Lui:
A

Ron Carson:
The

Malcolm Lui:
Great proposition.

Ron Carson:
Or the next day in omaha she's able to get she orders it today she has it tomorrow

Malcolm Lui:
Nice. So if you were to have a billboard in Omaha or anywhere else in the nation what would your billboard message say. Keep in mind that people only have six seconds to buy a billboard.

Ron Carson:
Yeah making the complex simple and adding value beyond a out

Malcolm Lui:
All right. Complex simple is good. So it's adding value beyond a doubt. OK. And last two questions Who are your ideal clients and what's the best way for them to reach your teen

Ron Carson:
So our ideal client is someone who wants to become a delegator that really wants to use professionals to proactively think about all of their stuff and we really operate in an environment of five hundred thousand we have several billionaire clients and and I would you know we in a second opinion Malcolm. We get a second opinion. We can look at someone's situation. There is a lot of low hanging fruit that's not being optimized whether it's tax estate asset management asset allocation service tax efficiency on on the way they're managing assets. You go to Carson group dot com or follow me on Linked In. I'm active on LinkedIn and Twitter and then I also put out these little videos called Ron sense and a go to Carson group dot com. They can sign up to those I keep them all under two minutes. So if you like some of the stuff we talked about today I dropped two or three of those out a week

Malcolm Lui:
Right now before your the advisers for your consulting authentic or who are your ideal advisors to invite onto the waiting list of your platform.

Ron Carson:
Yes so an advisor who first of all as a cultural fit meaning that they they they don't want to offer product they want to be totally transparent with their clients. And so if they meet that criteria 100 million minimum of advisory assets and we take firms well over a billion in size so let's call it you know one hundred million to one and a half billion. Although we're working on a deal right now where they're you know they're over 2 billion in size.

Malcolm Lui:
Right. Any contact you at Carson group dot com as well.

Ron Carson:
And my personal email is our Carson at Carson group dot com and I respond to all my emails if someone wants to email me even just with a question.

Malcolm Lui:
All right. Fantastic. It's been great having you on my show Ron. I really enjoyed hearing about how you grew your company so fast.

Ron Carson:
Thanks for having me Malcolm.

Malcolm Lui:
We've been speaking with Ron Carson, the Founder and CEO of Carson Group, about his company's rapid growth. For interviews with other fast growing, high value sales companies, or to learn how we can accelerate your firm's high value sales through automation, visit Eversprint.com.

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