Why Pre-IPO Investing Isn't an Advisor Problem — It's a Missing Infrastructure Problem

Dean Rubino of KPC Private Funds on why clients are chasing pre-IPO deals without their advisors — and what fiduciaries actually need before they can say yes.

Your client just watched a segment about the next big AI company heading toward an IPO, and now they want in. You hesitate. According to Dean Rubino, that hesitation isn't a mistake. It's a reasonable response to a market that was never built for fiduciaries.

Dean is Co-Founder and CEO of KPC Private Funds, an SEC-registered adviser that gives independent wealth advisors institutional-grade access to private funds. After 25-plus years in private funds, including a stint as CEO and CIO of Hamilton Lane's Richcourt Group, he joins host Mike Langford on this episode of The Modern Financial Advisor Podcast to explain why access to pre-IPO equity has gone direct to consumers, why advisors have been left standing on the sidelines, and how one set of documents, one signature, and one K-1 can change the equation.

Connect with Dean Rubino on LinkedIn and learn more about KPC Private Funds

What You'll Learn in This Episode

• Why Dean says the real pre-IPO "mistake" is a market structure issue, as access skips the advisor and goes straight to the end investor

• What fiduciary-grade infrastructure looks like: custodial acceptance, proof the seller has the right to sell, and a diligence file that can stand up in a regulatory exam

• Why Series D vs. Series E, common vs. preferred, and anti-dilution provisions matter when buying pre-IPO equity

• Why private companies are staying private longer, and how value creation has shifted from after the IPO to before it

• How one subscription document, one e-signature envelope, and one consolidated K-1 can replace five of each

• How pooling capital and investing through a QP-qualifying vehicle can widen access to funds with $10 million minimums

• Why the complexity in private markets isn't the investment itself — it's knowing how to evaluate it

Why This Matters for Financial Advisors Right Now

Why are advisors hesitant about pre-IPO investing?

Advisors hesitate because most pre-IPO vehicles were designed for the retail buyer, not the fiduciary. Dean's argument is that the market is going direct to the consumer and bypassing the advisor, who is left saying, "I wouldn't do that because it doesn't have the infrastructure." Clients watching CNBC or listening to Bloomberg Radio get excited about SpaceX or the latest AI names, but they often don't know which questions to ask, where fees may be hidden, or whether the vehicle actually owns what it says it owns.

What infrastructure do advisors need to offer pre-IPO exposure?

Advisors need three things: custodial acceptance so the investment appears on the client statement, reasonable assurance that the seller actually has the right to sell, and a diligence document that can be shown in a regulatory exam. Dean also stresses the investment details. Are you getting Series D or Series E shares? Common or preferred? Are there anti-dilution provisions? Understanding where you sit in the capital structure is as important as knowing the purchase is real.

Why is private market paperwork such a burden for advisors?

Each private investment typically comes with its own subscription agreement, often 50 to 80 pages, plus an offering memorandum and a limited partnership agreement. Dean says those three documents together can exceed 200 pages. Make five investments and you're handling five sets of documents, five sets of signatures, and five e-signature envelopes, multiplied across every client. And because financial advisors typically keep around 90% of client assets in stocks, bonds, and ETFs, they can't afford to spend more than roughly 10% of their time on private investments.

How does KPC simplify private fund investing?

KPC's platform is structured as a fund in which every investor is essentially a "fund of one," so the advisor can build a customized allocation for each client rather than a one-size-fits-all portfolio. According to Dean, an advisor can invest a client across hedge funds, private equity, pre-IPO stock, and co-investments with a single set of documents, a single e-signature envelope, and a single consolidated K-1. KPC is an RIA, not a broker-dealer, and Dean says the firm's client is the financial advisor.

Why are private companies staying private longer?

Dean points to two reasons. First, private capital pools, including private equity funds, sovereign wealth funds, and large family offices, have grown larger and more sophisticated. Second, secondary markets for private shares have made it easier for founders and employees to get liquidity without waiting for an IPO. The result, in Dean's words, is that a big part of the value creation that used to happen after an IPO now happens before it.

"The complexity is not the investment itself. The complexity is how do you evaluate the investment."
— Dean Rubino, Co-Founder & CEO, KPC Private Funds

Resources Mentioned in This Episode

• KPC Private Funds — Dean's platform giving independent advisors access to hedge funds, private equity, pre-IPO equity, and co-investments

• Dean Rubino on LinkedIn — where Dean shares updates on KPC and the private markets

Related Episodes

• Why "Curation Over Accumulation" Is the New Private Markets Playbook for Advisors, with Frank Burke of PPB Capital Partners — Frank's approach to building portfolios starts with what the advisor is trying to solve, then relies on manager due diligence to vet funds. A natural companion to Dean's argument that diligence and infrastructure are what make private investments usable for fiduciaries.

• A New Unified Managed Account Platform Making It Easy for Financial Advisors to Customize and Scale, with Katie Hendrix of Dimensional — Dean's "fund of one" approach is about customizing allocations client by client. Katie explains how a UMA platform lets advisors do the same on the public side without adding operational burden.

• Why Asking the Right Questions About Your Client's Values Often Leads to Higher Quality Financial Advice, with Jason Britton of Reflection Analytics — Dean says the advisor knows the client best: their liquidity tolerance, risk tolerance, and goals. Jason shows how discovery conversations can shape what actually goes into a client's portfolio.

Frequently Asked Questions

Why aren't more financial advisors offering pre-IPO investments to clients?

Many pre-IPO access points were built for retail investors, so they lack the custodial acceptance, ownership verification, and diligence documentation a fiduciary needs. According to Dean Rubino, the market is going direct to the buyer and bypassing the advisor, which is why advisors often pass.

What should an advisor check before investing a client in pre-IPO equity?

Dean recommends confirming that the investment can appear on the custodial statement, that the seller has the right to sell, and that the diligence is documented. Advisors should also understand the share class and capital structure, including Series D or E shares, common versus preferred stock, and anti-dilution provisions.

Can an advisor invest a client in multiple private funds with one set of documents?

According to Dean, yes, under KPC's structure. An advisor can place a client in a combination of hedge funds, private equity, pre-IPO stock, and co-investments using a single subscription document, one e-signature envelope, and one consolidated K-1, rather than separate documents for each.

How can clients access private funds with high minimums or QP-only requirements?

Dean explains that by pooling capital, KPC's platform can meet minimums such as $10 million. Because the vehicle is large enough to qualify as a qualified purchaser (QP), investors who don't meet the QP threshold on their own can still gain access to QP-only funds. KPC works through financial advisors, who act as fiduciaries in deciding what to present.

This episode is for informational purposes only and does not constitute investment advice or an offer to sell or a solicitation of an offer to buy any security.

AI Just Exposed This Firm's HR Secrets — Here's How to Avoid It

John O'Connell of The Oasis Group on the AI mistakes already putting wealth management firms at risk — and the boring, overlooked use cases quietly paying off.

A wealth management firm turned on Microsoft Copilot, connected it to SharePoint, and assumed their HR directory was safe. It wasn't. Employees could ask Copilot directly who was on a performance improvement plan — and it answered.

That's the story John O'Connell, Founder and CEO of The Oasis Group, opens with on this episode of The Modern Financial Advisor Podcast. John has spent 2026 doing little else but talk to wealth management and RIA leaders about AI — 20-plus keynotes, a standing gig as Schwab's AI speaker, and a monthly AI WealthTech Map tracking 110+ firms — and he joins host Mike Langford to lay out exactly where the industry is getting AI right, where it's quietly exposing itself to risk, and what a financial advisor should actually do about it starting this week.

Connect with John O’Connell on LinkedIn and The Oasis Group

What You'll Learn in This Episode

• John's five-camp framework for AI adoption in wealth management: Vanguards, Roadrunners, Tasmanian Devils, Bison, and Ostriches — and where most firms actually fall

• How a Microsoft Copilot and SharePoint permissions gap exposed one firm's executive salaries and HR records

• Why "vibe coding" an AI tool without a developer review can open the door to SQL injection attacks and runaway token bills

• Why the best first AI use case in your firm is the most boring task, not the flashiest one

• How AI can help new financial advisors reach "escape velocity" faster, using FINRA's own retention data

• Why "written by advisors for advisors" should raise your guard, not lower it

Why This Matters for Financial Advisors Right Now

Is AI actually a cybersecurity risk for financial advisors? Yes — and the risk usually isn't the AI model itself, it's the permissions sitting underneath it. John's central warning in this episode is that AI tools inherit whatever access model already exists in a firm's systems. If a SharePoint folder is "hidden but not secured," a chatbot layered on top of it doesn't know the difference — it just answers the question. That's exactly what happened to the firm John describes: Copilot didn't break any rules. It followed the access permissions that were already quietly broken.

This matters for every firm in Mike's audience because the fix isn't exotic. John's advice: before you plug any AI tool into existing software, ask where your data actually goes, who can access it, and whether your permissions model would survive someone asking the wrong question. He also makes the case that free AI tools carry a second risk most advisors haven't priced in — firm data like fee schedules can end up used for training or debugging outside the United States the moment it's typed into a free tool.

The episode also tackles a tension every RIA principal feels: the AI tools are moving fast, but most RIAs are small businesses with no developer on staff. John's answer is refreshingly unglamorous — don't start with your flashiest, most client-facing idea. Start with the task your team hates most. Let AI document that workflow, iterate on it, and build comfort before anyone touches a client-facing use case. And if a vendor pitches a custom-built AI tool, John's advice is blunt: get a professional developer to pressure-test it before it goes anywhere near client data, because the kind of vulnerability that leaked over two million people's financial information in the real-world MOVEit breach started with exactly the kind of overlooked "what if" question most non-technical teams never think to ask.

Finally, John and Mike connect AI directly to one of the industry's most persistent problems: advisor retention. FINRA data shows 85% of financial advisors quit before year five — right around the point most successful advisors say it finally "clicked" for them. John's take: firms that use AI to compress the 7-to-9-year runway to owning a book of business, instead of just automating tasks for existing producers, are the ones that will fix this.

"You gave your people a chainsaw, turned it on, and you're asking them to juggle with it and not hurt anybody. That's probably not gonna work out well."
— John O'Connell, Founder & CEO, The Oasis Group

Resources Mentioned in This Episode

• The Oasis Group — John's consultancy for wealth management and wealthtech firms

• The Oasis Group's AI WealthTech Map — a monthly-updated map of 110+ AI-first firms serving wealth management

• Peaks Perspective Newsletter — John's newsletter, published twice a month to 70,000+ subscribers

• "You Are Not Your Client's Document Vault" — John's recent Financial Advisor Magazine article on document risk, closely related to the Copilot story in this episode

Related Episodes

• Redefining Growth for Advisors: Dan Zitting on Frictionless Tech, Sales Skills, & Client Confidence — Dan's take on stripping friction out of an advisor's day lines up almost exactly with John's "start with the use case nobody wants to do" advice. Good next listen for practical, non-flashy AI use cases.

• Financial Advisors Who Embrace New Business Models and Adopt AI Today Will Be the Last Ones Standing, with Steve Lockshin of Vanilla — John's firm tracks AI investment flowing into estate planning tech, and Steve's company sits right in that wave. A natural follow-up if the data and document angle in this episode caught your attention.

• The AI Paradox: How a Notetaking App Is Making Financial Advisors More Human, with Matt Halloran of Zocks — Same core question as this episode, approached from the opposite angle: what should an AI tool be allowed to hear and hold onto? Matt's episode makes the case for AI capturing more; John's makes the case for knowing exactly where that captured data goes.

Frequently Asked Questions

What are the biggest AI security risks for financial advisory firms?
The biggest risk isn't the AI tool itself — it's inherited permissions. AI tools like Microsoft Copilot answer based on whatever access controls already exist in a firm's systems. If those permissions have gaps, AI can surface sensitive data (like HR records or executive salaries) that was never meant to be visible, simply because it was "hidden" rather than properly secured.

What's the best first AI use case for a financial advisory firm?
According to John O'Connell, it's not a client-facing use case — it's the most boring, most-dreaded task in the firm. Starting with low-stakes internal workflows (like summarizing email threads or formatting recurring documents) builds comfort with AI before extending it to anything client-facing.

How can AI help new financial advisors succeed faster?
FINRA data shows 85% of financial advisors quit before their fifth year — right around when most successful advisors say they finally felt it click. AI can compress that learning curve by teaching new advisors firm processes, financial planning basics, and client conversation triggers much earlier in their careers.

Why "Curation Over Accumulation" Is the New Private Markets Playbook for Advisors

How Financial Advisors Can Build a Private Markets Offering That Actually Differentiates Their Practice

By the time a client asks you about SpaceX, the opportunity that made it interesting is usually already gone.

That's not a knock on the client — it's just how information travels. The investors who got into SpaceX's 2019 funding round, at a valuation in the $50–100 billion range, are now sitting on a stake worth well over a trillion dollars. By the time SpaceX's IPO made headlines and clients started asking their advisors how to get in, the return that mattered had already happened years earlier.

That tension is the center of Episode 151 of the Modern Financial Advisor Podcast, where Frank Burke, Chief Investment Officer at PPB Capital Partners, joins Mike Langford to talk about why private markets access has become one of the clearest ways for advisors to differentiate their practice — and why most advisors are further behind on this than they realize.

Frank has spent his career inside the private markets, joining PPB Capital Partners in 2017 to help build out the firm's Capital Market Solutions platform. PPB itself has spent almost twenty years helping RIAs across the country access private markets and alternative investments, building custom, white-labeled fund structures that let advisors offer proprietary alts exposure under their own brand.

If you've ever wondered how to talk to clients about private markets without overpromising, how to vet a manager you've never worked with, or how to build something in your practice that actually looks different from the advisor down the street — this episode is your playbook.

Connect with Frank Burke on LinkedIn PPB Capital Partners

What You'll Learn in This Episode

• Why the SpaceX effect is creating both pull (client-driven) and push (advisor-driven) demand for private markets access

• What "curation over accumulation" means — and why building your own white-labeled fund structure creates real differentiation, not just another product

• The liquidity education gap tripping up advisors and clients in interval funds and private credit

• How legal settlement finance works as a differentiated, low-risk private credit strategy

• Why operational due diligence matters as much as investment strategy when vetting a private markets manager

• Why advisors don't have to be a hero — and how to talk to clients about alt strategies you don't fully understand yourself

• How AI's energy demand is quietly creating a "picks and shovels" opportunity in private credit

Why This Matters for Financial Advisors Right Now

Frank put it plainly on the show: most advisors are in a commoditized business. You sell largely the same stocks, bonds, and mutual funds, charge about the same fees, and offer roughly the same services as the advisor across town. In large part, clients choose you because of you — the relationship, the trust, the way you make them feel understood.

Private markets access changes that equation. It's one of the few places an advisor can hand a client something genuinely unavailable anywhere else — a fund structure with their own name on it, built around their own vision, their own client base, their own specialty.

And the demand is real. With SpaceX's IPO behind us — and Anthropic and OpenAI's expected offerings not far behind — clients are increasingly asking advisors how they get access to opportunities like this. The catch, as Frank explains, is that by the time an investment is generating that kind of attention, the return that mattered has usually already been made.

Curation Over Accumulation: What It Actually Means

This is the phrase from the episode that will stick with you longest.

Most advisors think about alts access as a menu — a list of funds to pick from. Frank's framing is different. When PPB works with an advisor for the first time, the first question isn't "what do you want to allocate to." It's "what are you actually trying to solve, and what's your vision?"

From there, PPB helps the advisor build a custom, white-labeled fund of funds — a proprietary structure built around where that advisor sees value in the private markets. Some advisors want direct investing in sectors where their own client base has real expertise. Some want to run their own real estate fund. Others just want a curated selection of smaller, undiscovered managers they'd never find on their own. Either way, the fund carries the advisor's name, not PPB's.

As Frank explains it, that ownership is the whole point:

"It's that advisor's fund of funds, right? With their name right on it — and it creates a sense of ownership, a sense of pride that they have something out there that their peers don't. And that's what's driving a lot of our growth with these types of structures." — Frank Burke, Chief Investment Officer, PPB Capital Partners

That's curation over accumulation: not gathering as many alt products as possible, but building one differentiated structure that's actually yours.

The Newsweek Indicator: Why Being Early Beats Being Right

Mike shared a story from his time working at Fidelity's corporate headquarters in Boston, home to the company's famous "chart room" — a kind of museum of market history where the walls are lined with charts and old Newsweek covers marking key moments. The lesson passed down on the tour: by the time an investment hits the cover of Newsweek, it's over. That's the signal for smart money to get out — and for the general public's money to start piling in.

It's a useful mental model for private markets. Investors who got into SpaceX at that $50–100 billion valuation made roughly 50x their money by the time the company went public north of a trillion dollars. Clients hearing about SpaceX for the first time today, after the IPO, are hearing about it at the Newsweek moment — not the early one.

That gap, between when an opportunity is genuinely early and when it becomes common knowledge, is exactly where Frank sees the biggest opportunity for advisors who can get clients access sooner.

Legal Settlement Finance: The Alt Asset Hiding in Plain Sight

One of the most concrete examples Frank shared is a strategy most advisors have never heard of: legal settlement finance.

Here's how it works. When a legal case settles, the cash is often sitting in escrow — guaranteed to be paid, but not immediately available. Law firms still have to pay attorneys, clerks, and private investigators in the meantime, and traditional litigation finance — lending against cases that haven't settled yet — can cost a law firm north of 25% in effective cost of capital, since it's really a venture-style bet on whether the case wins at all.

Legal settlement finance is different. It only lends against cases that have already settled, where the money is real and simply waiting to move through escrow. That structure lets investors earn mid-teens returns with no case risk — the underwriting risk is limited to which plaintiffs may ultimately not be eligible for a distribution, not whether the case itself succeeds.

It's the kind of strategy most advisors would never think to ask about — and exactly the kind of thing PPB's curated platform exists to surface.

How PPB Vets Managers So Advisors Don't Have To

Private markets come with a structural challenge public markets don't have: there's no standardized reporting, no uniform way to verify what a manager is telling you. Frank says the biggest risk here is operational, not strategic — many first-time fund managers are excellent at picking investments but have never actually run a business before. Controls, processes, cybersecurity, the back-office fundamentals — that's where inexperienced managers most often stumble.

PPB partners with a third-party operational due diligence firm to vet managers before they go on the platform, and advisors building a custom fund with PPB can lean on those same relationships even when they bring their own manager to the table. As Frank put it, it comes down to a "sleep at night factor" — advisors can tell clients the operational vetting has already been done, not just the investment thesis.

You Don't Have to Be a Hero

This might be the most reassuring moment in the episode for advisors who feel behind on alts.

Frank's advice: you don't have to master every strategy to offer private markets access. Some structures are genuinely simple to explain — a real estate fund is just buying properties. Others, like AI-driven quantitative strategies, are close to a black box even for sophisticated investors. The advisor's job isn't to understand every mechanism. It's to trust the manager's track record and talk to clients about what they're personally comfortable explaining.

"You don't have to decide you're all of a sudden going to be an expert in all this AI tech that's going on. If that feels over your head, guess what — you don't have to invest in those, and you don't have to bring those to your clients." — Mike Langford, host, Modern Financial Advisor Podcast

The same logic extends to AI's ripple effects across the private markets. Frank pointed to a growing theme on PPB's platform: energy infrastructure. As AI data centers drive up electricity demand, smaller power companies are seeing what Frank called "an AI bump" — private credit opportunities tied to real, quantifiable infrastructure rather than the AI technology itself. It's the modern version of picks and shovels: you don't have to bet on the miners to profit from the gold rush.

Frank's 10-Year Outlook for Private Markets

Asked to look ten years out, Frank pointed to two forces that will reshape advisor access to alts: tax efficiency and democratization. He expects more advisors to place alternatives inside IRAs specifically for tax reasons — strategies like legal settlement finance are taxed as ordinary income, so tax-advantaged accounts make a real difference. And he expects registered offerings and interval funds to keep expanding access for smaller clients, driven in part by continued high-profile IPO activity from companies like Anthropic and OpenAI.

The throughline for advisors: the liquidity education Frank described earlier in the episode is only going to matter more as access widens.

Resources Mentioned in This Episode

• PPB Capital Partners — Frank Burke's firm, building custom private fund structures for RIAs

• PPB's Insights page — webinars and thought leadership from the PPB team, available at ppbcapitalpartners.com

• Investing in Private Credit for AI Infrastructure Companies - Mike mentioned an episode of the 6 × 6lock Podcast where Stanton Ray from Columbia Threadneedle shared how there are some really interesting private credit investment happening for power plants that are generating the electricity for the data centers that power AI.

Related Episodes Worth Your Time

• "How Much Have You Got?" — Bob Veres on the Awkward Present and Bold Future of Financial Planning — Bob's argument that the AUM model is on borrowed time and that "inertia" is quietly putting comfortable firms at risk pairs well with Frank's differentiation angle. Both episodes are essentially making the same case from different directions: standing still is the actual risk, not trying something new.

• Why Serving Business Owners Is the Secret Sauce, with Jason Early of RISR — Jason's "riches in niches" framing connects nicely to Frank's point about lower-middle-market private equity and "mom and pop" businesses being some of PPB's most successful current plays — different side of the same private-business-value coin.

• Michael Kitces on Creating Gravity to Attract Clients — Kitces's whole thesis is that differentiation through focus (not doing more, but doing something distinct) is what actually attracts clients. That's the marketing-side version of what Frank is describing on the product side with curation over accumulation.