Median AuM rose to $588 million in 2015 from $365 million in 2011, at a median compound annual growth rate of 9.2 per cent, while revenues reached $3.6 million from $2.3 million in 2011, at a CAGR of 10.9 per cent. 

“Solid relationships between advisors and clients have been central to driving this growth during tumultuous market environments,” Schwab said.  

For example, in 2015 average client size increased by nearly a quarter , while client retention rates remained at 97 per cent per cent, and around 75 per cent of new clients came through referrals. 

In other survey findings, a quarter of advisors said their top priority was to boost productivity by leveraging new technology. Indeed, firm profitability rose by 4 per cent in 2015 from the year prior, driven by continued improvements in operational processes and technology-driven efficiencies, Schwab said. This is a continuation of a long-term trend reported across these firms, with profitability having jumped 27 per cent in the past five years, the firm added. 

Firms are also focused on human capital, and are looking to strategically source the best talent to propel organizational success. At mid-sized firms with between $500 million and $750 million in AuM, 61 per cent plan to add relationship managers or investment professionals this year, and 57 per cent plan to add support staff. 

While firms will continue developing their technology, talent and client base organically, many are also preparing for inorganic opportunities to catalyze growth. A third of firms that manage over $1 billion, and almost a quarter of firms with under $1 billion in AuM, are actively looking to acquire, for example. Study participants reported 208 instances of some type of M&A activity, and 149 instances of “join” activity, in the past five years. Additional industry M&A data from Schwab shows that, last year alone, transaction volume among RIA firms reached a ten-year high of 84 deals, up 56 per cent from 2014. 

RIAs reported that they have maintained a ten-year growth trajectory despite numerous and varied investment environments, Schwab said. “The study underscores the critical importance of the advisor/client relationship as the bedrock of firms’ strength and resilience, and as a driver of growth. The data also reveals that stable client relationships coupled with robust business fundamentals is a recipe for success in firms of all sizes, as technology and human capital increasingly align to drive operational efficiency.” 

For this year's study 1,128 firms completed the survey, reflecting their experiences in 2015 as well as their annual growth rates from 2010 to 2015.