Advocating for Independence in the RIA Space with Chuck Failla

In this episode of the DealQuest Podcast, I’m joined by Chuck Failla - founder of Sovereign Financial and passionate advocate for the Registered Investment Advisor (RIA) space. As the host of the InvestmentNews podcast Go RIA, Chuck has become a key voice in helping financial advisors transition to independence and thrive in the RIA model. His firm, Sovereign Financial, is one of the country’s fastest-growing RIA platforms, offering comprehensive support for advisors who want to build their own future on their own terms.

We dive into why so many advisors are making the shift to independence, the infrastructure and mindset it takes to succeed as an RIA, and how Chuck’s own journey has fueled his mission to help others do the same. If you're a financial advisor considering your next move or simply curious about the rise of independent advisory firms, this episode is packed with insight, real-world experience, and powerful takeaways.


INTERNAL SUCCESSION: A SMART STRATEGY FOR FOUNDERS WHO AREN’T DONE YET

When people hear “deals” in the RIA space, they usually think of private equity (PE) buyouts. While that path makes headlines, Chuck Failla reminds us that internal succession is still a strong, relevant option, especially for founders who aren’t ready to exit.

Chuck sees PE as ideal for advisors who want out, but he’s different. He’s passionate about Sovereign and plans to lead it for 20–25 more years, launching new projects and driving growth. Rather than handing over control to PE and “having a boss for the first time in 30 years,” he’s focusing on internal succession, passing leadership gradually to team members who share his commitment. For founders with vision and energy, internal succession preserves culture, builds lasting value, and lets them shape their firm’s future on their own terms.


TO INSPIRE TRUE LEADERSHIP, OWNERSHIP MUST BE EARNED AND SHARED

Chuck is clear: to get your next leaders to treat the business like their own, they need a real stake in it. For him, internal succession isn’t just about continuity, it’s about creating genuine financial and emotional buy-in. He’s grooming someone on his team to become COO or even President of Sovereign, with one rule: they must be an equity owner.

Ownership changes how people show up, inspiring deeper care, responsibility, and pride, like the love a parent has for their child. Chuck isn’t giving away “lottery ticket” equity. Instead, he’s building a buy-in plan so his team earns their ownership and truly values it. In short, equity isn’t optional if you want your firm to thrive beyond you. It’s the bond that links personal ambition to the company’s vision, building leaders who care as much as you do.


KNOW YOURSELF FIRST - THE RIGHT RIA PATH DEPENDS ON YOU

The RIA industry offers more career paths than ever - wirehouse, IBD, or launching your own firm. But with all those options comes confusion. “There’s a flavor for everybody,” but that doesn’t mean every flavor is for you. Not everyone is wired for independence. The right path depends on your goals, personality, and risk tolerance. Some advisors thrive building something of their own. Others do better in structured environments with built-in support and that’s not a fallback, it’s a smart, intentional choice.

Before chasing headlines or trends, ask yourself: Do I want to lead and take on risk, or focus on client service within a team? What kind of environment truly supports my long-term vision? The best path is the one aligned with who you are, not what’s trending.

LEGACY REQUIRES REAL EQUITY, NOT JUST INCENTIVES

A key truth of leadership and succession: if you want long-term commitment, incentives aren’t enough, you need to offer real equity. Many firms try to inspire buy-in with phantom equity or profit-sharing. Those tools can motivate in the short term, but as Chuck explains, they don’t foster the same emotional investment. At his firm, Sovereign, they considered phantom equity but ultimately decided it wasn’t enough.

But Chuck had a realization. He says, “Equity is something you give to your kids.” To him, equity represents legacy, energy, and a deep, long-term investment in the future of the firm. If he wants his next generation of leaders to truly care about where the business is 20 years from now, not just how it performs this quarter, they need to know they own a piece of that future.

EQUITY IS THE KEY TO RETAINING AND EMPOWERING TOP TALENT

A recurring issue in the wealth management industry is the failure of firm founders to truly reward and retain their next-generation leaders (G2 and G3). Many talented advisors are walking away from firms—not because they lack opportunity, but because promises of ownership never materialize. One advisor he mentions was told “soon” for 11 years. “Soon” never came.

Chuck Failla drives this home by stating plainly: if you want people to act like owners, they need to actually be owners. Phantom equity or verbal assurances don’t create the same long-term buy-in. Real equity, true ownership, is what keeps your top people engaged and invested in the future of the business. Without it, talent walks. And when they walk, they often become your competition.

INTENTIONAL TEAMS DRIVE SUSTAINABLE GROWTH

When Chuck launched Sovereign, it was a lean operation, just him and a junior advisor managing $110M. Fast forward a few years, and they’re approaching a $1 billion firm with 17 advisors. That kind of growth doesn’t happen without scaling people and systems, and the needs of a billion-dollar firm are vastly different from a lifestyle practice.

The key lesson? Your team must evolve as your firm evolves. Chuck shares that he’s finally locking in his leadership team, the folks he wants around for the long haul, and those are the individuals who will have the first shot at equity.

If you’re serious about building a sustainable firm, you can’t afford to treat your team as temporary labor. You must intentionally cultivate leadership, recognize contributions, and make space for shared ownership if you want to avoid painful growing pains, or worse, a talent exodus.

TO TRULY GROW, YOU HAVE TO OUTGROW THE “LIFESTYLE PRACTICE” MENTALITY

What got you to $100M or even $500M in AUM won’t get you to $1B. Here's a critical shift that firms must make when scaling: you can’t rely on informal processes or a few people juggling everything “in their heads.”

At a certain point, often around $5–7M in revenue, you need to invest in infrastructure: hire non-revenue-generating roles, implement systems, and step into true leadership. Chuck shared that during this phase, his income actually dipped because he reinvested in his team and operations. It was a strategic sacrifice, and now he’s confident the next billion will be far more profitable. Real growth requires real investment. You have to let go of old habits and be willing to earn less today to build a business that scales tomorrow.


LET GO OF THE “I CAN DO IT ALL” MINDSET

Chuck candidly admits that for most of his career, he resisted systems, processes, and operational metrics. He even joked that one of his superpowers was "not knowing what the hell I'm doing." But as the firm grew, he realized he couldn’t scale effectively by relying on gut instinct or informal workflows. Real infrastructure was needed: KPIs, workflows, accountability measures, and most importantly, people whose full-time job is operations.

Many founders of growing firms hit a wall when they try to scale their “lifestyle practice” approach. To grow beyond that phase, they must stop trying to do it all themselves and instead invest in real systems and specialists. It’s a mindset shift from being the hero of the business to building a business that runs with or without you. Chuck saw dramatic improvements in a matter of weeks after hiring a seasoned Head of Operations. It was a clear signal: investing in operational excellence isn’t optional if you want to grow—it’s a prerequisite.


A “DEAL MAKER” MENTALITY OPENS DOORS BEYOND TRADITIONAL GROWTH STRATEGIES

Think about business challenges or opportunities not just from the usual angle, but by asking: who already has what I need? If you want to reach a certain market or audience, instead of trying to grow it all organically (through SEO, content, or social media), think about who already has access to that market.

I partnered with Investment News, which already has the audience I want to reach. By working together, both sides benefit, the partner gets value, and I get distribution. This kind of partnership is a “deal” even if it doesn’t look like a traditional business transaction.

It’s called the “deal maker mentality,” which means looking for creative ways to collaborate or partner with others to get access to resources, markets, or solutions that might be hard to build alone. For example, if you struggle to hire talent, besides posting jobs organically, you might consider acquiring a company or partnering with a recruiter, that’s another form of a deal.


Tune in as Chuck Failla discusses the evolution of the Registered Investment Advisor (RIA) space and what it truly means to be independent in today’s financial landscape.


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FOR MORE ON CHUCK FAILLA

Chuck Failla’s LinkedIn
Sovereign Financial Group's Twitter
InvestmentNews podcast: goRIA

FOR MORE ON COREY KUPFER
Corey Kupfer's LinkedIn
Corey Kupfer's Website

Corey Kupfer is an expert strategist, negotiator, and dealmaker. He has more than 35 years of professional deal-making and negotiating experience. Corey is a successful entrepreneur, attorney, consultant, author, and professional speaker. He is deeply passionate about deal-driven growth. He is also the creator and host of the DealQuest Podcast.

Get deal-ready with the DealQuest Podcast with Corey Kupfer, where like-minded entrepreneurs and business leaders converge, share insights and challenges, and success stories. Equip yourself with the tools, resources, and support necessary to navigate the complex yet rewarding world of dealmaking. Dive into the world of deal-driven growth today!