Mo Lidsky

Mo Lidsky: The Refugee Boy that Grew Up to Empower Families for the Future

A Journey Rooted in Resilience

Mo Lidsky’s story begins in Ukraine, where he was born and raised. In his early juvenile years, he immigrated to the United States with his family, and this transition was challenging. As refugees leaving Eastern Europe, Mo and his family faced significant hardships in Italy and Austria before settling in the U.S. Upon their arrival, his parents struggled to make ends meet, especially in the light of needing to provide for their multigenerational family.

All this led Mo to understand the importance of contributing to his family’s welfare at a young age. At just 11 years old, he began taking on various jobs—ranging from shoveling to delivering to cleaning—to help support his family. Being exposed to the reality of life at a young age allowed him to acquire the tools that he would eventually use in his future entrepreneurial endeavors.

An Entrepreneurial Venture

At age 17, Mo had already launched his first company, which he successfully exited just two short years later. This success led him into a career of building, buying, selling, and restructuring businesses. In addition to his entrepreneurial ventures, Mo became deeply involved in nonprofit organizations, establishing his own charitable foundation in his early twenties and serving on various board and executive positions.

Mo had not originally planned to enter into the financial services industry. However, his experiences during the 2008 global financial crisis provided an invaluable perspective that led to his eventual success. Witnessing the degradation of both personal and endowment wealth due to poor financial advice, Mo questioned the integrity of traditional financial advisors. Through this he identified three main issues: a lack of understanding of the financial services universe, the prevalence of “village idiots” in the industry, and flaws in how financial services were delivered.

Being determined to find a better way, Mo sought out multiple advisors on Wall Street and Bay Street in Toronto but found the industry heavily saturated with professionals more interested in asset accumulation than in providing unbiased, conflict-free advice. Frustrated by these hidden motives within the traditional financial services model, Mo envisioned a new approach—one that prioritizes clients’ purposes and personal objectives over institutional gains.

The Birth of Prime Quadrant

Unable to find a family office that aligned with these values, Mo partnered with a mentor to establish Prime Quadrant. Over the past 15 years, Prime Quadrant has grown into an esteemed family office with team members across North America, serving hundreds of families worldwide. The firm’s mission is to offer an encompassing approach to wealth management, focusing on the connection between financial, social, human, and intellectual capital.

Prime Quadrant separates itself through a unique model that forgos the traditional asset-based fees. Instead, the firm adopted a time-based retainer model, making sure that advice remains unbiased and aligned with clients’ best interests. This approach minimizes conflicts of interest and grows long-term, trust-based relationships with clients. Keeping the client’s interests at the core of everything they do.

Conclusion

Mo Lidsky’s journey from an immigrant to the founder of Prime Quadrant offers invaluable lessons in the wealth management sphere, and family office operations. His commitment to client centered financial services, in addition to an all encompassing approach that merges philanthropy and intergenerational dynamics, sets a new standard in the industry. Through this, Mo has exemplified a modern approach that has left a mark for all to see in the generations to come.

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Interview Transcript

Alan
Welcome to American Dreams. I’m here today with Mo Lydewski. Mo, welcome to today’s show.

Mo Lidsky
Thank you Alan, delighted to be here.

Alan
So Mo, for the listeners here, you have a very unique background. Can you walk through how you ended up where you are today?

Mo Lidsky
Sure, sure. It was a confluence of, you know, wild and wacky events. maybe I’ll just go back a little bit in time. So I was born and raised in Ukraine. We immigrated to the US in the early 90s. We were refugees for a couple of years in between in Italy and Austria. But the long and short of it is when we arrived, my parents

struggled horribly. A lot of immigrants find their way eventually, but unfortunately my parents weren’t in that category of people. so everything proved to be difficult. mean, keeping our apartment, putting two meals on the table, looking after kids and grandkids and grandparents. And so as a result, by the time I was 11 or 12 years old, I realized that I kind of needed to play a role in helping.

make all of those mundane things possible. And so I started out from 11 years old going up and down houses, businesses, asking for any kind of work. Cause unfortunately in America, not a lot of get full-time work as a 12 year old. So you kind of have to get creative in how you make hay. I don’t know what I would have become, but that’s certainly…

inspired an entrepreneurial spirit. it because it didn’t matter what I had to do, what I had to shovel, deliver, carry, serve, clean box, whatever it may be. Anyway, longer story short, when I was 17, I started my first company that I sold when I was 19. And then proceeded to build, buy, sell, turn around, restructure businesses ever since. And along the way, I got very involved with a number of

nonprofit organizations. I’ve had my own charitable foundation since I was in my early 20s and played a couple of both a number of board roles and a couple of executive roles and some nonprofits more on an interim basis. And I think what really what brought me into the world I’m in today, I had no aspirations of being in finance and financial services. But after having both overseeing some pools of capital,

from an endowment point of view, from a board role, and also from overseeing my own capital and going into 08, the global financial crisis. And coming out of that, I had a dozen or so different advisors around me, obviously all of the big banks on both in the US and Canada. And when I got to 09, by the time I was in 09, I had eviscerated just an

amount of personal wealth. And I saw an equally significant amount of wealth being eviscerated from some of the endowments that I was involved with. And it seemed like the narrative was the same, the outcome was the same from basically everybody that was advising me and surrounding me. And so the conclusion that I drew from that at the time was either one of three things was either I don’t really understand how to leverage the financial service universe.

or I have a unique ability in surrounding myself with the village idiots of the financial services universe, or there’s something fundamentally flawed about the way financial services are delivered and there’s gotta be a better way. And so, you know, I went up and down Wall Street and Bay Street here in Toronto, trying to find better advisors for myself. you know, it started as a, like a curiosity.

eventually evolved into like somewhat of an obsession. it was a search for advisors, became curious, and an obsession. And eventually a frustration because here I was, I had taken hundreds of meetings. And what I quickly realized is that 100 % of the people I met were either in the business of gathering assets or in the business of transacting with assets. And really that

the whole notion of unbiased conflict free advice, the whole idea of empowering individuals as opposed to selling them on an idea, as opposed to convincing them to send money to coffers of some institution or do some transaction or something else that’s in a way exogenous or external to their highest purpose and personal objectives. I just realized that that

infused the industry with a whole host of moral hazards and misalignments and conflicts. And I thought that there had to be a better way to help people achieve their goals, or given the highest probability of achieving their goals, and given the lowest probability of realizing on the things they wanted to avoid, right? And the other thing that kind of dawned on me was that even the fundamental structure and the compensation structure

I didn’t pay too much attention to it when I was running my businesses, but it was strange how I had advisors, lawyers, accountants, tax, stake, whatever it may be, and even nutritionists and other folks. And people charge you for the service you deliver. And then here I would have a liquidity event with an advisor that maybe had one or two million dollars, and then you have a $20 million liquidity event and you send it over to the advisor.

and they just throw it in the same stocks and bonds or whatever funds they had and all of a sudden, ostensibly delivering the same exact service, but now 10X the compensation for no incremental addition in value delivered. I just thought that there was something inequitable about that, and I wondered whether families could do better. And then the other piece was,

just the simple connecting the piping and wiring that all affluent families face, you know, everything from the philanthropic to the estate, to the family dynamics, to the structures, to the acts, the, you know, what you realize is a lot of folks in the wealth management arena back then talked a good game and said that they delivered on all these things. But when push came to shove,

you know, especially if the assets were fragmented, nobody really cared as much about the whole thing. Nobody was incented to. And, the family office ecosystem was sort of nascent. And certainly the multifamily office was nascent, you know, at the time. So, you know, I thought that there was a place in the world, there should be a place in the world for like a McKinsey of the family office world. I first looked for one for myself. And when I couldn’t find it, I said, well, hell.

So I partnered with a older mentor of mine and that’s kind of the business that we started. And anyway, fast forward today, I mean, we have team members across North America and we have several hundred families that we work with around the world. And yeah, and so find myself in this interesting business where, you know, 15 years ago, I didn’t know a shred about this and

and had to learn everything the hard way. But here we are. So that’s the long short of it. I don’t know if that answers your question.

Alan
So when somebody comes to you, how do you differentiate what you do versus…

Mo Lidsky
Yeah, so I think putting aside the simple compensation model, but I think it is important. I think it’s worth highlighting. I think, again, the traditional financial service industry is largely based on assets under management or some kind of compensation relating to the assets, which is kind of interesting because for a lot of families, people don’t ascribe value to

percentage of assets. They, for starters, because then everything becomes alpha focused. Like you start thinking about like, well, what could I get, you know, in a beta context versus what could I get in an alpha context? And now all of a sudden the S &P, which is a total red herring, sort of becomes the thing that everybody’s paying attention to. Whereas if you’re an affluent family, if you’re an affluent family, like the S &P,

I mean, really, truly makes no damn difference. I mean, it goes up, it goes down, it’s gonna do whatever it’s gonna do. My question is, am I thoughtful about the relationships that I have? Am I thoughtful about how I’m raising my children, my connection with my community, my personal fulfillment in the work that I’m doing, and whether it’s work on myself, work on…

that’s a little bit more aspirational in some industry or sector, work that’s a little more philanthropic or some impact that I truly care about. And so the question is, how do I give myself the highest probability of achieving that? And sometimes, I mean, think about it in a philanthropic context. If all of a sudden, the only way I want to give away all my capital during my lifetime and

By virtue of me doing that, I am taking money out of my advisor’s pocket every single month because I’m reducing their compensation. Invariably, I set up this unfortunate conflict where I’m like forced to tell him, I have to lower your compensation this month again. And they have to kind of, well, this that the other, put them in this position where they kind of have to defend their compensation. And I think I just think that that’s A unhealthy and B again, the value doesn’t scale with the assets.

I our compensation historically has been sort of a time-based retainer compensation that is a function of the scope and complexity of the mandates. And those mandates could be everything from family office formation or family office optimization. It could be educating the next gen. It could be optimizing the investable assets or portfolio construction manager selection, building out a real estate portfolio, whatever it may be. The question is, what is the family want? Why do they want it?

And do they have optimal alignment between their financial capital, their social capital, their human capital, their intellectual capital? And I think creating that synergy is really what’s most important, most valuable. I mean, I think that’s kind of silly. A lot of families spend enormous amount of time, you know, on the assets that they don’t really care about. So it’s like weird because if you’re ultra affluent, the only thing

capital in some ways abundant and time is scarce and all of a sudden I’m going to trade my this scarce resource to make more of this abundant resource. And it’s it’s kind of a silly exercise unless it’s accompanied by a higher purpose, unless it has added meaning that’s imbued to that process.

Alan
You recently did a book, Prime Quadrant. What would be the inspiration behind that?

Mo Lidsky
Yeah, okay. So Prime Quadrant was actually the very first book that I co-wrote. There’s been several books since. The Prime Quadrant, really, I wrote that actually right as I was getting into this business. So the Prime Quadrant, by the way, which is the namesake of our business and now the namesake of our charitable foundation, is ultimately sort of in that Northwest Quadrant where they return

highest given and the risk is lowest and so on and so forth. But it actually is just a broader concept of like, how do you make optimal decisions, right? With the highest benefit and the lowest cost. And again, when the time I was writing this book, because I didn’t come from the industry, I thought, how do I come up to speed and make sure that

I could put myself up to public scrutiny. could actually ensure that I could have intellectual integrity around that process. And I thought if I put out a book that could be scrutinized and criticized by everybody else, especially if now my business depends on it, it better be accurate and it better be good. And so I did the best bloody job that I could. And of course, when you’re sort of relatively new,

to a sector, an industry, and again, we’re going back 14, 15 years. A couple of years later, all of a sudden you realize how ignorant you were two to three years earlier. So much so that I’ve actually tried to bury that book. And I’ve actually tried to get to the publishers to take it out of print. I’m sort of mortified by what I initially wrote in those editions. since then, I’ve written several books. a couple more on advisory.

one on philanthropy, another one on investment lessons from the world’s greatest frauds, and now more on intergenerational family dynamics. But I think the goal with all of them is not to put out a bestseller into the world. There’s a topic I’m personally interested in, and I want to sort of ensconce myself in this particular world. And the only way that I know how to do that

with some skin in the game is by putting it out into the world. because maybe I’m an egomaniac, maybe I’m a perfectionist, maybe something else, but it just feels like that’s what compels me to learn and keep myself sharp. So that’s why I keep writing.

Alan
So what are some of the biggest mistakes that people make when it comes to managing their investments?

Mo Lidsky
Ooh, okay, there is a lot of them. Like, there’s a lot. So I think if you think about it, are, these mistakes would probably fall into two broad categories. like behavioral mistakes and structural mistakes. behavioral, those are the things that all of us, you know, who have emotions and biases, we become subject to. And there’s,

There’s a kind of a long list of these behavioral ones. like hindsight bias, overconfidence, loss aversion, recency bias, all these things. And it’s really candidly, it’s a lifelong journey to adapt our psychology to managing them. again, it doesn’t matter whether you’re a veteran or a newbie, you’re going to be subject to that. I mean, I think the other ones that I think are easier to navigate are like the structural mistakes, right? So, and we could avoid those much easier. that’s like the simple things like,

lack of planning or really lack of good processes, things like over concentration, tolerating conflicts, employing insufficient resources for things like due diligence or monitoring. And even, I think if I were to say, if I’m looking specifically at structural mistakes, the two that I see most commonly with families would be number one, reactive versus proactive decision-making.

And what I mean by that is, you know, I often joke that one of the greatest sources of wealth destruction is when people move assets from the opco to the hold go. And the reason being is, you know, when they’re, when they’re operating business, every decision is based on some kind of long-term plan, KPIs, OKRs, whatever it may be, you know, the PNL, the Banshee, all of us, those keep us accountable when we have to source a mission critical piece of technology or

software or infrastructure, whatever, this is going to be a really robust process of sourcing and originating and so on and so forth. And so super conscientious, super proactive, super disciplined, super accountable, and so on and so forth. Then all of a that money moves from the op co and there’s liquidity event and then goes to the hold co. And all of a sudden some guy showed up with a pitch deck or a deal or a mortgage or God knows what. And it’s like, now all of a sudden I’m sitting there adjudicating it. And it’s like, it’s like,

completely reactive. so people, people forget, first of all, they oftentimes don’t understand the size of the asset management world. They don’t know how to wrap their arms around the asset management world. They don’t know that, you know, what happens to come into their box. I mean, I can’t tell you how many families I meet and they say, we get tons of deal flow. And then you actually look at the quality of their deal flow and it’s like, it’s, all the runoff that nobody else wanted.

and they get a of it. But it’s reactive. So again, that’s a structural mistake where with the right kind of resourcing and whether that resourcing is internal staffing or external sort of outsourced support or whatever else, being able to proactively identify who’s the best in the business and how do I access them on the best terms and the best structure and so on and so forth. So that’s how I would say, number one, reactive versus proactive. And the second is like,

I think unrealistic expectations would be a biggie. know, like a lot of people drive forward by looking in the rearview mirror. There’s a fellow here in my YPO group who often says there’s a reason the front windshield is bigger than your rearview mirror. You know, and I think a lot of people kind of confuse historic information with practical insights for decision making about the future.

or the historical frames too short, or they’re basing it on just their own recent experiences or witnessed experience as opposed to, the longer arc of financial history, which is hundreds, not thousands of years old.

Alan
When a person is selecting their financial advisor, you kind of hit on this or hit around it. What types of questions should you be asking when you’re interviewing a financial person? You mentioned about people that get a lot of deal flow. How do you know you’re getting the right person on your team?

Mo Lidsky
Okay, so again, I come back to like, there’s probably two things that come to mind. Number one, it’s like all the obvious things. Like, you know, when you’re due, when you’re diligencing a fund, for example, and you want to make sure that there’s like a yes across every chat box, like independent administrator, independent custodian, you know, sort of, they’ve kind of quantitatively outperform whatever peer group or index that they have.

They’ve been around through the cycles. Their terms and fees are reasonable, yada, yada, yada, right? So like, just want to, you got to check all the boxes. So they’re similar, like I think for advisors, like a lot of check the boxes, like do they have access to all of the asset classes? Are they looking at your world holistically instead of myopically? You know, do they have a history of, of, a reputation of integrity? You know, are they, do they have the wherewithal to actually look at your objectives?

and give you the highest probability of achieving those. those are like, so that’s experience. Did they work with families like mine? Little things like that are kind of critical. And then I think that there’s, so those are the very practical considerations. And then there’s the values, which I think are actually more important, which is would their person, does that person put my interests ahead of their own?

you know, is this the kind of person that would give me the straight goods, whether good, bad, ugly, whatever it may be, is this the kind of person that views, that appreciates the way I view the world. And it would sort of help me mobilize around that. And I think so, I think that a lot of the values about who somebody is as a person.

will often dictate how they behave under duress, under stress, because that’s ultimately the only thing anybody cares about, right? In good times, you know, everybody is honky-dory, but it’s just when things go sideways, how will somebody behave? And where will my interests lie in that equation? I don’t know if that answers

Alan
There’s so much we could cover on the ground, but we’re running up against our time slot here. So for the listeners here that want to reach out and inquire more about your family office services, how would they go about that?

Mo Lidsky
Sure, it’s good question. think the first I would encourage them to sort of check us out, primequadrant.com. We’re certainly not for everybody. Secondly, I would certainly have a wonderful team that supports me, both in meeting new families and that are interested in what we do. But I always also welcome hearing from good people.

my email, emlitsky at primequadrant.com. And anybody that’s a friend of yours, Alan, is always welcome to reach out to me directly as well. yeah, I think that would be the best way.

Alan
Thank you, Mo. It’s been a pleasure having you with us today on the show.

Mo Lidsky
Thank you, Al, and then thank you for doing this. This is a gift to your community, and I hope you continue doing this for many years to come.

Alan
Thank you.