TradePMR scores Jon Patullo in lightning 'coup' after CEO Robb Baldwin took a phone call and lands a key player for his skyrocketing growth strategy

Jon Patullo and Robb Baldwin each suffered setbacks in the past six months, but Patullo's hiring by the TradePMR CEO looks more than fortuitous.

Patullo is now its chief product officer after stints at Apex Clearing, Schwab Advisor Services and TD Ameritrade (TDA) Institutional RIA software systems. 

This hire is a “big coup” – not only for TradePMR, but also for Patullo, says Joel Bruckenstein, producer of the T3 conference series, in an RIABiz interview.

“This is Jon's opportunity for TDA 2.0,” he says. 

“Jon's last two assignments [at Schwab and then Apex] were nothing like TD Ameritrade. Trade PMR has always hit above its weight on technology, and they also have a culture like TDA.”

Patullo's departure from Apex stunned industry observers almost as much as his arrival at the Gainesville, Fla., RIA custody up-and-comer. 

But his Apex exit turned out to be impeccable timing for TradePMR. See: Apex eliminates Jon Patullo's position in a move that baffles analysts but may clear the way for Mike Kerins to take on the 'Astra' challenge

Focused growth

With 165 staff, TradePMR is executing a series of moves to facilitate spiking growth.

The importance of the Patullo hire traces to TradePMR's (largely) beneath-the-radar move to go dramatically upmarket – even terminating relationships with about 1,000 RIAs.

The custodian currently counts 350 RIAs – versus 1,370 at its high point back around 2018 – encompassing some of the biggest consolidators. See: TradePMR is making RIAs sign a promise to succeed -- to good effect

It has brought aboard 75 wirehouse breakaways in the past couple of years – many in friendly transactions with Wells Fargo based on a referral deal dating back to 2011. 

Wells, the nation's third-largest bank, owns First Clearing, which is the custody and clearing capability behind TradePMR. 

Now, virtually all of its RIA clients are registered with the SEC and manage more than $100 million – many of them, much more.

“Most of our new clients are roll-ups looking to add a custodian,” Baldwin says. 

The smaller ones stick around only by demonstrating cogent growth plans, he adds.

Patience pays off

Patullo likes where he landed – and for reasons he makes clear.

“Throughout my career in this industry I have seen TradePMR grow alongside the independent advisor profession,” he says in a release. 

“It’s inspiring to now be a part of that forward-thinking growth and to join such an experienced and highly regarded leadership team who are each dedicated to helping advisors grow and succeed."

The hire didn't come easily. 

Baldwin had been on a fruitless two-year search for a “product” maestro and came within a hair of hiring one six months ago.

He “passed on" that particular talent, he says, and opted to wait, however long, for the right person to pop on the job market.

In late April, a familiar Floridian's voice set him in motion.

“Joel Bruckenstein called and said, 'You'll never believe who just became available,'” Baldwin recounts in an RIABiz interview. 

Ultimate insider

Bruckenstein offers a sweeping analysis of how Patullo could be the ultimate catalyst of an established firm shifting into high gear.

Not only does he know all the vendors from building platforms alongside their leaders – Tony Leal, Brian McLaughlin, Eric Clarke etc. – but he also knows what so many RIA firms are looking for.

The kicker, Bruckenstein adds, is that Patullo knows precisely what his competitors – namely Apex and Schwab – are up to. 

Patullo was the first vice president of technology development at TD Waterhouse and led the transition of institutional business technology in the wake of the merger between TD Waterhouse and Ameritrade. 

He went on to senior technology roles within TD Ameritrade where, among other career highlights, he was instrumental in the launch of the firm’s VeoOne and Veo Open Access platforms. 

Following Schwab’s acquisition of TD Ameritrade, Patullo oversaw all institutional platforms and integrations for the combined company.

He worked temporarily at Apex before the surprise elimination of his position that made Baldwin take notice and begin a brief but effective HR courtship.

Evolving strategy

For the first 19 years of its existence, TradePMR provided an early plug-and-play option for small advisors that made life simple and inexpensive. 

Still, even in its early days, it was trying to build an RIA franchise. 

The evolving RIA segmenting strategy at TradePMR also called for an amended vision of technology priorities at the firm.

Now, the emphasis going forward is to solve technology as an add-on custodian for big RIAs, who tend to use software bundles from firms like Orion and Black Diamond, which they have no plans to replace.

Asked about other emerging RIA custodians, like Altruist and Apex, Baldwin says his firm simply has a different business model and strategy.

Client focused 

Competitors are laser-focused on automating tasks to obviate the need for old-line human service teams for many tasks. 

Baldwin is determined to keep his phone service tip-top. 

Even now, TradePMR promises to answer a phone call within 15 seconds, and Baldwin says he – a la yesteryear's TDA RIA guru Tom Bradley – hands out his cell phone number to every RIA client.

"The value that they place on people and culture is evident, and it shows up in the work the team does every day,” Patullo says.

Baldwin says big RIAs with sophisticated clients totally appreciate the high service levels, and he suspects that if he raised prices to maintain those levels, most RIAs would accept it without complaint.

Big RIAs like Peter Mallouk are openly encouraging small custodians to step up their games and assume the try-harder, Avis mantle that TD Ameritrade was known for. See: Peter Mallouk is exploring new RIA custody vendor for his $300-billion firm, despite new Fidelity referral deal; this time around upstart brands are in the running

Moving up

Another key selling point with big RIA clients is the firm. At 25 years old, it's “not raising capital,” and has positive cash flow, he notes. 

Indeed, both Altruist and Apex, youndger RIA ventures,  have made headlines as they raise, or strive to raise, capital. 

Altruist just landed $169 million, mostly from ICONIQ. See: Division of $80-billion RIA leads a $169 million round and takes a 10% Altruist stake -- the second in a row with big 'RIA' investors, if not yet their custody assets

Apex came near to a SPAC IPO. See: Left at the IPO altar once, Apex -- replete with two new TD Ameritrade RIA executives -- tries again to go public, but this time it's not counting on a SPAC partner

Though Apex has hired a slew of former TD Ameritrade staff, its business has long been in clearing and forming a backbone for fintech firms like Robinhood and Wealthfront. See: Olivia Eisinger convinced Apex to hire dozens of her fellow ex-TDA staff to 'reimagine' VEO and the service and now it's an RIA custody deliverable with a Big-Four-or-bust mandate -- and some analyst doubts

TradePMR is about to expand its headquarters, with a move to nearby St. Petersburg. It has 45,000 square feet there compared to 22,000 in Gainesville. It owns two more lots in St. Pete for future growth.