During the Pershing RIA Symposium last week, several RIA firm leaders discussed their treks from starting firms to growing and running them. The speakers were Brent Brodeski of Savant Capital Management, which has nearly $6 billion in assets; John Burns, CEO of Exencial Wealth Advisors, which has $2.4 billion in assets; Jeff Concepcion, CEO of Stratos Wealth Partners, which has $13.5 billion in assets, and Jack Petersen, co-founder and managing partner of Summit Trail Advisors, which has $5.5 billion in assets. The panel was moderated by John Furey, founder and partner of Advisor Growth Strategies, a consulting firm.
Here are their best practice recommendations:
1. Know your role — and limitations. Petersen noted that as a firm grows, obviously the role changes for the founder and head advisor. "It's important to know what your role is and to make sure you're the right person for that role," he said. "I would not be the managing partner of [my] business in five or 10 years. I'll have to hire a professional CEO. I'm better at recruiting and finding talent; the front end is a good use of my skills."
Burns agreed, stating that now he doesn't handle any financial planning, instead just manages the firm. He said that "as a firm approaches $5 million or so in revenues, you need to get serious about making that leap."
Moving from founder to full-time CEO meant a willingness to "adapt to the position," Brodeski said.
Furey added that leaders need "to be vulnerable. Just because you're the founder doesn't mean you're the smartest person in the room."
2) Pick a model and develop a culture. Concepcion says that Stratos focuses on advisors who service clients, and evolved the model by asking partners what they needed. "We find out what their pain points are and deal with them," he said, for example, handling firms' human resource and talent acquisition needs.
Brodeski said his firm follows the "Arthur Andersen model — before Enron." Therefore, they globally developed one firm, one culture, one set of processes, one balance sheet, one income statement. He says the advantage to this model is they can "create scale" and they are "centralized despite people being spread out," adding the firm-wide approach to doing things aids with this. He also said "be deliberate about what model you want and how to differentiate from others."
Petersen said his firm went with servicing ultra-high net worth clients, which by focusing on a group can "enhance the client experience."
3) Hire the best people. Perhaps a cliché, but all speakers noted this was harder to do than thought.
