Moss Adams launches growth strategy with its first RIA acquisition in a decade

Editor’s note: Moss Adams is famous among financial advisors for telling them what they should do. What’s interesting is that the Seattle-based accounting firm is now practicing what it used to preach. It is growing itself as an RIA practice in near textbook fashion. This article looks at how it is and will continue to use the full playbook to supercharge its growth.

It was the worst of times in the summer of 2008 when Rebecca Pomering left her post on the consulting side of Moss Adams LLP to take the reins of the company’s wealth management firm.

Her job was to take her knowledge as a consultant and drive growth of Moss Adams Wealth Advisors LLC but economic conditions did not cooperate with her mission.

But with time and markets now on her side, Pomering’s plan is starting to take shape.

Major leap

It took a major leap forward with the purchase – announced yesterday — of Rowling, Dold & Associates LLP, a firm of four employees with about $200 million of assets under management in San Diego. The practice will be folded into Moss Adams’ San Diego office under the Moss Adams brand.

It gave Moss Adams Wealth Advisors a 25% growth in size from $800 million to $1 billion – a hallowed milestone in the advisory industry.

The acquisition brings Moss Adams Wealth Advisors to 9 locations with 32 people. The other locations beyond Seattle include: Portland, Santa Rosa, Calif., Los Angeles, Sacramento, Calif., Yakima, Wash., Everett, Wash., Spokane, Wash and Tacoma, Wash.

The acquisition of Rowling, Dold was the first by Moss Adams in a decade when it started its wealth management division with the purchase of a Seattle-based RIA. All of the growth since then has been a matter of putting an employee or two in a Moss Adams accounting satellite office.

Pomering now expects that Moss Adams will get more aggressive in making its acquisitions, with perhaps one purchase in the next year and two withing 18 months. Moss Adams is targeting Portland, Ore. first.

Though it would not rule out a deal with another firm of its size, Moss Adams is likely to target practices of $200 million or less.

“Another $1 billion firm isn’t what I’m looking for,” Pomering says.

Consulting experience

So what about Pomering’s consulting experience helped her to forge the deal with Rowling Dold?

“Knowing what made other deals fall apart made us more confident,” she says. “We didn’t waste a lot of time on things that aren’t important.”

In other words, Pomering and Sheryl Rowling, the principal of Rowling, Dold focused initially more on how they could form a cultural fit and less on financial terms. Both sides want to be in the business for the long term, do comprehensive planning and to serve business owners and high net worth individuals.

That approach carries over to their investment approach. Moss Adams has a conservative core-satellite philosophy that utilizes both index funds and active management, Pomering says

Though Moss Adams plans to step up its acquisitions, Pomering is also pursuing two other strategies to achieve growth.

High on her list is trying to better intregrate Moss Adams’ product offering on the accounting side with wealth management services.

“Every CPA has an RIA that they can refer clients to but not every CPA an RIA that they’ve integrated services with,” she says.

The other mode of growth that Moss Adams hasn’t partaken of much to date is conventional marketing. For instance, it plans to do more to educate clients and to get exposure through public relations.