Page 33 - Investment Advisor June 2021

Mindy Diamond
CEO of the advisor recruiting and
search firm she founded in 1998

Louis Diamond
President of Diamond Consultants

Do these trends surprise you or were there signs
they were coming?
LOUIS The pivot point we saw — in what advisors valued
and how they were expressing these values by the firms
they chose — was right after the financial crisis [of 2007–2008]. Before Elliot Weissbluth launched Hightower, he came to
Before the crisis, our recruiting data showed that a quality wire- our office to pitch the model. I remember saying to him, “That
house team would — 70% of the time — stay in that channel. is never going to fly. No wirehouse advisor is going to go to a
Post crisis, as advisors saw that these brands could work to firm they’ve never heard of.”
their detriment, advisors overall just wanted more freedom But he proved me wrong. This was the first firm, despite the
and control over their businesses. We saw the pivot point for lack of brand name recognition, to show that if advisors could
the opening of these regional firms to pick up market share. get what they wanted — more freedom, flexibility, control and
The boutique space used to have Deutsche Bank, Credit the ability to monetize the business — they’d be very happy to
Suisse, Lehman and Bear Stearns, and all those firms either go and vote with their feet.
went out of business or were sold to larger companies. The Even though Hightower represents a different model today,
boutique space was kind of missing some really exciting the model itself is probably one of the most popular models
higher-end options. there is due to the notion of supported independence.
Fast forward to around 2017-2018, First Republic becomes a Also, in terms of the coronavirus pandemic’s effect, there is
really viable home for top teams. Rockefeller also came along no question that the work-from-home initiative absolutely was
and has been doing this for a few years. a large factor in driving advisor movement. We’ve seen more
The financial crisis was the pivot point for when advisors movement of top teams in 2020, into 2021 and going forward,
gave themselves permission on behalf of their clients to con- driven by a lot of disenfranchisement.
sider going to either lesser-known firms or striking out on Again, people want more freedom and control, and don’t
their own and building their own brand. Ultimately, they real- like the amount of bureaucracy they’ve been dealing with or
ized the clients’ relationship was with them and not with the don’t trust their leadership, etc. But [working from] home
organization or the name on the business card. has given them the time and privacy to self-reflect and to
do their due diligence in a way that they didn’t before. It’s
MINDY Looking back, Hightower Advisors was a maverick also driven home the notion that “I am not nearly as reliant
in this space. When it was first born, it was a very different on my branch manager or the infrastructure and support of
model than it is today. Today, Hightower is an established RIA my branch as I thought I was. Maybe I’m more likely to go
business. At first, its target was disenfranchised wirehouse independent. I need the big brand name or the big behemoth
advisors who wanted a model of supported, quasi-indepen- firm less than I thought I did.” All of those things are driving
dence with a partnership. advisor movement.

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