A San Jose-based RIA aggregator that’s been referred to as a “wirehouse-lite” is getting ready up to hire another few dozen financial advisors.
Registered investment advisor (RIA) Concert Wealth Management plans to hire about 40 new financial advisors this year following its hiring of veteran Merrill Lynch wealth manager Brad Stratton earlier this month, according to On Wall Street.
Last fall, RIABiz wrote that Concert Wealth Management “targets advisors with as little as $100 million and it doubled in size in the last year.” The company picked up 12 wirehouse teams between September 2010 and September 2011, offering what one expert called “an RIA-in-a-box strategy for mainstream advisors who want to turn independent but don’t want to start a business from scratch.”
“They’re riding this wave of capitalizing on literally thousands of wirehouse advisors who have been defecting annually,” Dan Inveen, managing principal of FA Insight of Tacoma, Wash. told RIA Biz late last year.
Concert Global was founded in 2006 by Chief Executive Felipe Luna, a former UBS vice president, who’s also worked at Smith Barney and Merrill, and who started the new company with his wife. The inspiration, Luna told On Wall Street this week, was getting away from major Wall Street firms. From the firm’s success in hiring so far, Luna said he sees more professionals who share that sentiment.
“When we first started the firm, it was to get away from the bureaucracy and control mechanisms inside the large firms,” Luna said. “When we grew up a little bit after about a year and a half, we realized that our sentiment was shared widely and across the population in these wirehouses, and they all seemed to have the same set of issues,” feeling they couldn’t serve their clients properly while catering to the needs of their employers.
Stratton joined Concert on Feb. 17 after about 20 years at Merrill Lynch. He comes to the firm with about $75 million in client assets under management and will be based out of the firm’s Overland Park, Kansas office.
Concert currently has about 66 total financial advisors. The firm has also has two offices in Houston, an office in Tempe, Ariz. and multiple locations in California, including San Diego, Port Beach, Walnut Creek, Menlo Park and Sacramento. Two new locations in Los Angeles are expected to open in the coming weeks.
Wirehouse financial advisors have been attracted to the firm because of the support Concert provides in the transition, Luna told On Wall Street, particularly for the middle office. To expand its force, Concert is seeking financial advisors who are focused on their clients and working mostly from fee-based platforms, including advisor as portfolio manager, separately managed accounts or mutual fund wrap business.
To expand its force, Concert is seeking financial advisors who are focused on their clients and working mostly from fee-based platforms, including advisor as portfolio manager, separately managed accounts or mutual fund wrap business.
Changes in the RIA space channel could also help lure financial advisors, says Luna. This year, the Dodd-Frank legislation will require that small to mid-size RIAs with between $25 million and $100 million in assets under management register with states instead of the Securities and Exchange Commission.
“The complexity and cost of remaining compliant is going to go up for many of these RIA firms, so we’re starting to see a good many of them looking for some options,” Luna said.
For expansion in this vein, Concert will look to the Boston, New York, Washington, D.C. and Florida areas. The firm is scheduled to open a Chicago office in the next few weeks and a Dallas location by the end of March.