Ray-Jay RIA event produces how-I-did-it talks from four high-achieving RIAs

Brooke’s Note: Conference coverage doesn’t always make for thrill-a-minute copy. But when a firm like Raymond James uses its event as a forum for breaking news, provides updates and coaxes advisors into sharing a few tricks of the trade, it can get pretty good. Anthea Penrose does a nice job here of curating a bunch of that sort of information to make this a worthy read.

Raymond James Financial is launching a new no-transaction-fee ETF platform that will be available to the channel’s advisors and their clients beginning in November, according to Bill Van Law, president of Raymond James investment advisors division, in his opening remarks at the firm’s sixth annual Wealth Managers Conference in St. Pete Beach, Fla. from from Oct. 6 to Oct. 8. The event had 300 attendees, including 120 current affiliated and 38 prospective advisors. See: Raymond James launches a separate RIA unit and appoints a former Merrill Lynch breakaway to head it.

Nearly 120 funds are included on the new ETF platform from firms such as First Trust Corp., AdvisorShares Investments LLC, ALPS Advisors Inc. and Greenhaven Continuous Commodity Fund — with plans to expand the platform further down the road.

“We do plan on growing the NTF-ETF platform,” says Mike DiGirolamo Sr., vice president and managing director of the custody division. “We are currently in discussions with several other fund groups. The funds are chosen to complement core holdings in advisor-managed accounts. We have invited those ETF fund groups who have an active relationship with Raymond James to participate, and also have included funds that are more actively managed and those requested by advisors.” See: Why ETF sponsors are ponying up big fees to get on Schwab’s ETF OneSource in a bid for access to ticket-averse RIAs.

Van Law also announced that before the end of this calendar year, Raymond James-affiliated RIAs will have access to Hearsay Social — the company’s technology for automating aspects of social media. See: A few things I learned about the Raymond James RIA effort in an NYC sit-down with Bill Van Law.

Paul Reilly[r. with Bill Van Law]
fielded questions from an audience concerned
about the regulatory environment and possible
threats to the independence of advisors.

“The current state of social media for RIAs using Raymond James as a custodian is essentially unrestricted but a 'do-it-yourself’ model — and they cannot get access to Hearsay Social, as it is an enterprise solution only,” says DiGirolamo. “Being on the Hearsay Social platform will mean that archiving and compliance is so much easier and smoother. They will also be able to use all the pre-approved content in our library, (which they can use now, but it’s a very manual process) and Hearsay also provides the benefit of “social signals” which help trigger some action on the part of advisors to reach out to their clients and prospects.”

New faces

Van Law added that in the last quarter, three RIA firms with combined AUM of over $500 million selected Raymond James as their custodial partner. In fact, he said, nearly 40 prospective advisors were among the attendees.

In his address to wealth managers, Raymond James chief executive Paul Reilly recapped the last five years in terms of steady growth, consecutive quarters of profitability (now 106), increased investment in technology, and in particular the firm’s commitment to the RIA channel. He also took questions from an audience concerned about the regulatory environment and possible threats to the independence of advisors; the DOL’s interpretation of the fiduciary standard; and the firm’s process for looking at new products, its due diligence and its management of risk. Reilly promised extraordinarily high levels of support to advisors — even as the firm absorbs higher costs.

Ten years on

Four advisors delivered TED-style talks about their firms and how they built their value propositions and their successful practices. See: Raymond James lets six advisors steal the show at its national event with TED-style talks.

Yellowstone Partners’ David Hansen contemplated a
name change, then decided to embrace
his western roots.

Dave Hansen, principal of RIA Yellowstone Partners in Idaho Falls, Idaho, talked about the lessons he learned growing up on a farm about not taking shortcuts, mastering needed skills and planning ahead, which has helped him grow his business from $100 million when he bought his firm ten years ago to over $1 billion in assets now. See: A $15-billion roll-up-like venture in Canada gets a US foothold with a Dynasty Financial deal — and vice-versa.

He has been successful in three areas: organic growth (the slowest yet most profitable); recruiting (fraught with challenges but rewarding when done right); and acquisitions (quickest growth path, but fatal if the values and culture don’t fit — but Hansen said he has been fortunate in identifying good matches.) To achieve this success he has honed his message and is meticulous about keeping it consistent. After deliberating a name change, Hansen decided to embrace his western roots, where, he says, a handshake still means something.

Frank Moore, principal of Vintage Financial Services in Ann Arbor, Mich. described his growth as organic. Ten years ago he reached a crossroads: whether to level off at around $80 million in AUM and enjoy a relaxed lifestyle or dedicate himself to growing the business. Moore did the latter and Vintage is now a nine-person team with six advisors managing over $350 million in assets. Some of the steps he took were in marketing — developing a website, paying for Google ad words and improving search engine optimization. He also joined NAPFA and is very active in that organization. See: How Google Love can put an RIA onto an equal marketing footing with BlackRock.

What would 'Andy’ do?

Deborah Stauring is principal of Winthrop Financial Partners in Buffalo, N.Y., a firm that was created when her previous decades-old firm with seven owners split up three years ago. At that time, Stauring was determined to serve all client groups who need services rather than following the industry trend to find niche markets. Her team must embrace all new ideas and all members are encouraged to develop and share ideas and strategies they believe in. One successful strategy is their women-focused Health, Wealthy & Wise events. Stauring is also involved with the community organizations she features in photos on her website and social media. See: How some RIAs are starting to end up with Raymond James as their custodian.

Frank Moore related a crucial crossroads
he faced at his firm’s decade
mark.

Mike Baittinger of Andesa Financial Management in Allentown, Pa., along with his partner Paul Baittinger, developed a brand personality in the persona of “Andy” — a customer they strive to serve. “Andy” is a mid-50s architect living in Maine. In his free time, he enjoys fishing, listening to classic rock, craft beer and scotch. Whenever they need to determine a strategy for marketing the firm, they ask, “What would Andy do?” Their niche clients are mature, hardworking, wholesome executives. Baittinger said the firm has been successful in building out their business focusing on those clients and all aspects of their lives.

Clips show

Attorney and compliance expert George Guerra, of Wiand Guerra King P.L. in Tampa, Fla., used clips from famous movies and television shows — including The Sopranos and I Love Lucy — to help advisors remember the steps necessary to have a successful audit.

He also shared some sobering stats: Over the last three to five years enforcement of RIAs has risen; advisors who have never been audited are being targeted; and due to the aging population, many clients are falling into the “vulnerable adult” category.

While only 9% of SEC regulated RIA firms are audited annually, of those 90% will receive some sort of deficiency letter, and 35% of those will have serious findings. Some quick tips for those facing an audit: give the auditor his/her own space to work; assign a team member to be the point person assisting with any requests for documents or questions; have the entire team on alert; be sure you have maintained detailed and accurate records; have an end-of-first-day debrief with the auditor to help create a game plan for the rest of the audit; and to instill confidence in your firm’s compliance processes. See: The SEC will often 'tell’ advisors what compliance issues deserve attention.

Motivating speakers

Shawn Achor, whose work on the link between happiness and success was featured on the cover of Harvard Business Review, delivered the closing keynote on the “Key to Raising Success, Spreading Happiness and Sustaining Positive Change.” He posited that in the midst of challenges, one can still raise their level of happiness above the genetic set point by changing behavior. Previously it was thought genetics and the environment controlled our happiness, but one’s brain is a third factor. In fact, only 10% of our long term happiness is based upon our external world, while 90% of it is based upon our day-to-day experiences and social connections.

Mike DiGirolamo: We do plan on
growing the NTF-ETF platform.

Communications expert and author Sally Hogshead shared her research and guidance on how to “fascinate” from first impression to lasting value. Hogshead demonstrated to advisors how they could capture the interest of their prospective clients within nine seconds of meeting them, by understanding their own skills, strengths and points of differentiation. Her message is that the more an advisor can stand out and front-load their values, the less they will need to spend on branding. In terms of capturing attention, “different” holds a much more competitive advantage than being “better.”

Eighty-five percent of financial success, Hogshead said, was due to communication skills — not technical skills. The most successful advisors understand how others — particularly prospects — perceive them, and the more they can control and dissect the prospect’s “tells” and signals the more they can establish value and “fascination.” She urged the audience to specialize in one area, to do one thing differently and really well in order to establish value — for which clients will pay more. See: Dissecting the pathology of UHNW wealth managers who want brand building without marketing.

In addition there were more than a dozen sessions on the financial markets, investment strategies, portfolio construction, technology tools (new and projected), practice management, trust services, insurance products and enhancing a firm’s digital marketing from home office experts, as well as sponsors and educational partners. Non-Raymond James speakers included: Ray Sclafani of ClientWise; Mike Perkins, Voya Investments; Kevin Glavin & Chris Egan, Henderson Capital; Stephen Kwa, Schroders; Jake Anonson, Principal Funds; David Kelly, Ph.D., J.P. Morgan Funds; C. Thomas Howard, Ph.D., Athenalnvest; Tim Galbraith, Transamerica; John West, PIMCO; Nathan T. Snyder, Snow Capital Management; Chris Dillon & Darrell Riley, T. Rowe Price; and Jim Bowen, First Trust.

Anthea Penrose is PR manager at Raymond James Financial.