Cetera hiring Mike Durbin as CEO -- overseeing its existing 'CEO' -- completes Genstar's stellar HR week after it put Charles Goldman atop Orion's board -- with 'exponential' growth in mind for the 'middle market' companies
The Los Angeles broker-dealer nabbed the Fidelity legend to take its $118-billion AUM and 8,000 advisors higher, just as Orion -- also majority owned by Genstar -- makes a similar move.
8 min read- Genstar taps Durbin as Cetera CEO, Goldman as Orion board chair.
- Durbin and Goldman bring extensive experience from Fidelity and tech firms.
- Hires signal Genstar's focus on 'exponential' growth in wealth management.
- Durbin's role suggests Cetera Holdings will take a more active role.
Brooke's Note: We writers know as well as anybody that you can't be embroiled in rote tasks in an atmosphere of day-to-day chaos and simultaneously think – and act – originally, creatively and with something resembling “vision.” The nurture of – and execution of – as-yet-unimagined vision is not something you can teach a bank or a public corporation to fund or build into a business plan. Private companies and private equity investors don't love it, either. Yet, if green enough pastures of opportunity beckon at the same time that competition closes in, a Genstar can make head-spinning HR moves for a Cetera and an Orion with job descriptions that amount to, “Figure it out.” Mike Durbin and Charles Goldman – with collaboration across their shared Genstar ownership and personal friendship – might be as good as it gets for finding thinkers and doers. People also find them likeable up and down and out of the organization. The wealth management “desktop” might be the best it's ever been. But overwhelming, too, is that a big leap is still there for the taking for someone who is managerial, visionary, technical and understands the peculiarities of doing business with RIAs.
Genstar flexed its power, again, landing Mike Durbin as Cetera Holdings CEO, just two days after reporting that Charles Goldman had accepted the board chairmanship at Orion Advisor Solutions.
The San Francisco private equity manager of $49 billion in ‘middle market’ holdings now has two former Fidelity execs on board to steer its relatively recent acquisitions -- Cetera in 2018 and Orion in 2020.
Coincidentally, Goldman and Durbin worked together overseeing Fidelity's clearing and custody businesses. See: Focus shifts to Durbin at Fidelity as Goldman prepares to depart
Though the two men last worked together in 2009, their relevance never waned, says Cecile Munoz, CEO of U.S. Executive Search, who has known each since the 1990s.
“They were trailblazers in the RIA business and because they were forward thinking, they have moved to the vanguard of the next ‘Next,’” she says from her Los Angeles headquarters.
“It makes the argument why, at the time of maximal sea change, you need a seasoned leader who has seen and done a lot and can pick up the phone and rally people around him.”
Critical moves
Both Durbin and Goldman have had stints as CEOs of technology companies – with Durbin serving as CEO at eMoney and Goldman at Assetmark. See: 'No BS' Mike Durbin leapfrogs up the Fidelity Investments ladder but can he serve RIAs, eMoney and Abby?
My sense is that Mike Durbin’s hire by Cetera and Charles Goldman's by Orion shows how much the lines are blurring between custodians/clearing firms, independent advisor networks and TAMPs," says Alois Pirker, CEO of Pirker Partners.
The hires are critical moves by Genstar to put plans into motion, says Daniel Seivert, CEO of ECHELON Group in Manhattan Beach, Calif.
“Perhaps the biggest job of PE firms is developing relationships with top executives in the space, convincing them to leave their current profile, and instead, lead the portfolio companies they control and are invested in, then set those executives up for success with an attractive reward structure and a flow of opportunities.”
Focus shifts to Durbin at Fidelity as Goldman prepares to depart
Durbin's hire as CEO of Cetera Holdings also comes with a curveball because he is not replacing Adam Antoniades, the current CEO of Cetera Financial Group. It's essentially a created role with a presumed intraprenuerial corporate mandate.
“What is Cetera Holdings going to do? What active role will it take?” asks Munoz. “Mike Durbin didn't come in to maintain the status quo or even to maintain iterative growth.”
Much of it will come down to whether Genstar is as good at positioning Durbin for success.
“Some of them know what they are doing in terms of compensation programs and equity, but many are pretenders and not contenders,” Seivert adds.
Positioned for growth
Cetera tried previously in 2018 to execute a similar jumpstart by hiring ex-LPL president Robert Moore, but the two parties parted ways in 2019 after Moore experienced health concerns. See: After RIA private equity hot-shot Genstar's $1.7 billion purchase of ugly duckling Cetera, Robert Moore plans to take on LPL--not with acquisitions, but a recruitment storm
Larry Roth also came and went as Cetera CEO. See: PE-backed Cetera board member Robert Dineen sees Larry Roth to the door, takes CEO reins
Durbin will serve as a member of the Cetera board of directors. Antoniades will continue to serve as CEO of Cetera Financial Group and as a member of the board of directors and report to Durbin.
“Cetera is in a position of strength and poised to capitalize on today’s opportunities, and Mike is well qualified to lead the organization to and through its next chapter of success,” said Tony Salewski, managing partner at Genstar Capital. See: In a deal wired by a 'Tony,' Orion leaps to the top TAMP tier, with $42 billion and $1 trillion-plus of RIA portfolios, which may make it more lethal to rivals
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“We look forward to continued execution of our new five-year plan and achieving meaningful growth together with Mike, Adam and the entire Cetera team.”
The hire of an RIA-minded executive like Durbin may give Cetera greater bonafides in claiming its platform covers the spectrum of brokers, hybrids and RIAs under the WealthHub moniker.
Ultimate destination
Though Cetera oversees an estimated $330 billion in assets, it only counts $116 billion in assets under management for its 8,000 affiliated advisors, as of March 31.
PE-backed Cetera board member Robert Dineen sees Larry Roth to the door, takes CEO reins
Antoniades sees room for Durbin to influence the RIA mix at his broker-dealer.
“Mike’s deep expertise and background in the RIA, retirement and custody and clearing space, as well as his proven track record of leadership and innovation, will help Cetera further solidify its position as the ultimate destination for financial advisors and institutions,” he said in today's release.
Durbin sees an opportunity to catalyze an “exponential” jump in revenues by putting more RIA capabilities at Cetera reps' fingertips.
“Cetera is well positioned for exponential growth by continuing to deliver new and innovative capabilities to advisors through its Wealth Hub, and truly meet the changing needs of today’s top advisors,” he said in the release.
No stranger
Durbin spent much of his recent energies at Fidelity giving his company greater wallet share for IBDs and RIAs using its Wealthscape platform.
He oversaw the development of FMAX, a super-TAMP that replaced Envestnet in-house at Fidelity. See: Fidelity's Mike Durbin unleashes FMAX as 'Schwabitrade' takes life, but if they build it, will leery advisors buy into it?
At Fidelity, however, Durbin was never able to win the Cetera account, held primarily by Pershing.
But he's no stranger to the broker-dealer world.
Before joining Fidelity, Durbin held various leadership positions at Morgan Stanley, including chief operating officer of the national sales division of global wealth management.
The reinvention of Cetera from an insurance sales arm to more holistic advice began when Lightyear Capital bought ING Group's three broker-dealers, Financial Network Investment Corp., Multi-Financial Securities Corp. and PrimeVest Financial Services Inc.
It added Genworth Financial’s broker-dealer and investment adviser firms in 2012.
Good as Gold… man
Orion announced Goldman's appointment as chairman Monday (May 15). He was appointed to Orion’s Board in August 2022.
He joins board directors Jonathan Baum (formerly Executive Chair), Noreen D. Beaman, M. Roy Burns, Eric Clarke, Todd Crockett, Lori Hardwick, Brian McLaughlin, Sid Ramakrishnan and Tony Salewski.
“We are thrilled to have Charles as our new Executive Chair of the Board,” said Eric Clarke, founder and CEO of Orion in a statement.
“His extensive leadership experience in the financial services and wealthtech industries will be instrumental as we continue to grow and expand our business, powering advisors and winning for investors.
"We are confident that Charles will provide significant insights and guidance in this new role.”
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