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Brave Thinkers

A Growth Strategy

Wealth managers Charles and Lynn Zhang leveraged their Kellogg MBAs to take their business to the next level — and help others in the process

Charles Zhang '04 and Lynn Zhang '04 already had an incredibly successful business. In 1996, Charles was named the number-one advisor out of 10,000 American Express Financial (now Ameriprise) advisors. He went on to achieve the top spot six more times — and the second spot four times.

By 2002, the Zhangs' Michigan-based firm — Zhang Financial — managed more than $400 million in assets for its clients. But the couple knew they could do even better.

"At a certain point, managing the business becomes very important," Charles explains. "We decided to get executive MBAs so we could apply what we learned back into our practice right away."

Both Charles and Lynn applied to Northwestern's Kellogg School of Management and the University of Chicago Booth School of Business. "We were accepted by both but chose the best — Northwestern," says Charles.

A focus on leadership

The couple says their decision continues to pay off. "We had the best two years. We loved all of our professors and got a great education," Lynn adds.

"People who start their own businesses have a tendency to micromanage," Charles explains. "The MBA program really helps you to develop as a leader — to pull yourself from the day-to-day operations and look at it more from a macro perspective."

In addition to helping them better manage their practice, the Kellogg Executive MBA program cemented the Zhangs' desire to change their business model on a fundamental level. "In one of my Kellogg classes," Lynn recalls, "the professor explained that compensation changes people's behavior. That is absolutely true.

"We decided to get executive MBAs so we could apply what we learned back into our practice right away."

"A lot of advisors have incentives when they choose financial products for their clients," Lynn continues. "Some financial advisory firms say they're fee-based, meaning they receive fees, commissions and/or kickbacks. But if you still have a financial incentive to recommend specific products, you're not free from a conflict of interest. Any commission kickback isn't the right incentive system."

The Zhangs committed to avoiding those incentives. By 2011, their practice was fee-only.

"We adopted a compensation structure that removes the conflict of interest from our practice. So it doesn't matter what we recommend to a client — it's 100 percent objective," says Lynn.

Sharing their success

Thanks to this approach, along with the lessons learned through the EMBA Program, the Zhangs' practice flourished. "Kellogg taught us how to manage a business," says Charles. "It used to be we were more like a small business. At that point, we managed $400 million. Now we manage more than $3 billion." Charles was also ranked seventh in the nation on Forbes' list of America's Top Wealth Advisors for 2018. He is the highest ranked NAPFA-registered, fee-only financial advisor and the highest ranked independent advisor on the list.

"What we learned in the classroom that we've applied back to our practice is incredibly important."

The Zhangs are enthusiastic about sharing their success. "We believe in giving back. For the past several years, we've given back 20 to 30 percent of our total income," says Charles.

Their generosity benefits a wide range of organizations, both local and global. Just a few examples include animal shelters, counseling centers, leading universities and global organizations that help at-risk children. The Zhangs have regularly given back to Kellogg, most recently in naming the Charles and Lynn Zhang Recruitment Lounge in the Global Hub.

'We're very thankful'

"We're often asked by people, 'Is an MBA truly worthwhile? Or is it just networking?'" says Lynn.

"Honestly, we still remain friends with some of our fellow students," Lynn continues. "But that's only part of it. What we learned in the classroom that we've applied back to our practice is incredibly important. That has helped us a lot, and we're very thankful."


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