Creative Planning, a $45 billion RIA based in Overland, Kansas, has just announced its third-ever acquisition, which is also its third for this year. Moreover, it expects to announce even more before year-end.
Creative Planning is acquiring OptiFour Integrated Wealth Management, a $400 million RIA based in Reston, Virginia, near Washington. Terms of the deal were not disclosed.
“Our other RIA acquisition, out of Minneapolis went well, which raised our profile,” explained Peter Mallouk, CEO of Creative Planning, referring to its acquisition of The Johnston Group, an RIA with $500 million in assets under management, in February. (Creative Planning also acquired America’s Best 401K in September.)
“More acquisitions are on the way, around year-end … Firms are reaching out to us,” said Mallouk, who grew the firm from $30 million in AUM in 2004.
He explained that Creative Planning looks for advisory firms that share its investment philosophy, which focuses largely on passive investing but embraces certain alternatives such as private equity, lending and real estate for high-net-worth clients, and on a financial planning approach. An affinity with the owner’s core values and with key employees is also important, according to Mallouk.
“We buy the entire firm but the owners stay on board, hopefully for a long, long time.”
In the case of OptiFour, its principal, Mark Cohen, is an estate planning attorney like Mallouk and the firm, like Creative Planning, offers investment, tax and estate planning services.