A Force in the West, With Aspirations

Kochis: Some are advisors, others are senior persons in administrative and staff functions.

So it's good for the owner and good for the employees. What about clients?

Francais: We start there. When you think of what your clients are concerned about, it's multigenerational wealth management. None of our clients wants us to sell to the financial services industry, but they also acknowledge and recognize the wealth opportunity that's there for the principals. So the foundation is [determining] what makes the most sense from the client's perspective. The tricky thing is how to tie people and clients together in a productive fashion in this industry. We think we've done it through this merger, in terms of critical mass and scale, and through the beginning stages of the transition to equity.

Clients want us to remain independent, to remain objective, to not sell financial products, and to retain the very talented people who service their accounts. To the extent that we have created an environment of governance, structure, ownership, transition, and compensation that makes sense for the clients and for our people–that's where we think we're going to get longevity.

It sounds like this merger isn't the end of your growth plan.

Francais: It is the first step to expand nationally, though we have to get this one done first before we contemplate the other. But we're doing it with an eye toward a national platform.

Tim, post-merger, how do you ensure that the uniqueness of the firm, the independence, the culture that you've built and that your customers have come to depend on doesn't get lost?

Kochis: You're right to put your finger on that risk, Jamie. Both Rob and I have been students of the business of merging, and we know the kinds of mistakes that have been made. We're committed to not making the number one mistake: taking your eye off the ball. It's all about the client. We are devoting ourselves and committing our firm so that doesn't happen.

Size does not become a goal in and of itself. Size is not about aggrandizing ourselves, but about achieving benefits for our clients [with] a broader, more robust platform, with scale and pricing efficiencies.

We know many firms around the country that have the same strong client service aspect, desire for independence, and continued objectivity that want to do the same thing. We're providing a model. Whether they become part of our firm, or whether they take our example and use it locally in a way that makes sense for them, either way we will have provided a benefit to the profession.

Because you're independent advisors who are forging your own solution to the issue of succession and scalability.

Kochis and Francais: That's exactly right.

Editor-In-Chief James J. Green can be reached at [email protected].