Independent advisory firms are looking for advisors who have big books of business that can generate high recurring revenue.Andrey Popov/iStockPhoto / Getty Images
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When it comes to recruiting top advisors to independent advisory firms, it’s not just about the money but treating them as clients and partners, not employees.
That’s the message from Natalie Bisset, head of corporate development at Richardson Wealth Ltd. in Toronto.
“The majority of candidates we’re talking to right now, including advisor teams, are interested in having a voice in the decisions the firm makes and how they affect their clients,” she says.
Independent firms are recruiting advisors actively with promises of independence, agile technology, and a respect for the entrepreneurial mindset, says Brett Evans, director of trading, capital markets and wealth management at Bay Street Staffing in Toronto.
“I’m painting with a large paintbrush here, but there’s a lot of competition [for talent],” he says.
Mr. Evans, who has been a recruiter in the financial advisory space for 11 years and works with traditional and independent wealth management firms, hasn’t seen a significant increase in turnover, but the pandemic has had an effect. People are less tolerant of what they’ll deal with and want more flexibility. He says independent firms are taking advantage of that.
Firms recruiting advisors have to be willing to let them be in charge of their own books of business, he says, pointing out that some traditional institutions such as the banks don’t let their advisors manage their own marketing efforts, including their LinkedIn profiles.
Administrative support also plays a large role in attracting advisors to smaller firms. Mr. Evans says traditional institutions are still bogged down by siloed, legacy technology, whereas independent firms have invested in modern platforms to help advisors make decisions faster, creating more time for them to serve their clients.
“I’ve heard stories where six advisors are sharing an admin [person at a traditional institution], whereas in the independent model the ratio is better at one [admin person] to one [advisor] or one [admin person] to one-and-a-half [advisors],” he says.
When it comes to getting new talent, Wininpeg-based Wellington-Altus Private Wealth Inc., which has been on a recruiting spree since it was founded five years ago, is looking for advisors with large books of business as part of its goal to reach $50-billion assets under administration in the next five years.
“We want high-quality advisors who have a high recurring revenue and the highest average books out there,” says Charlie Spiring, founder, senior wealth advisor and chairman at Wellington-Altus in Winnipeg.
Along with the promise of independence, the firm has invested in new technology as part of its strategy to lure high-performing advisors.
But big books aren’t the only criteria when it comes to hiring. Shaun Hauser, the firm’s co-founder and chief executive officer, says it’s looking for people who can make a difference in clients’ lives.
“Advisors are part-time psychologists, lawyers, accountants, financial planners, people connectors, therapists, [and] it just goes on and on,” he says.
“Very successful advisors are so ingrained in clients’ lives that they become friends because clients rely on them to do so many things that fall out of the simple definition of a financial advisor.”
Offering practice management support
Richardson Wealth, which is also looking for advisors, has taken a similar approach in investing in tech tools, but it has also created a practice management curriculum in which advisors can share best practices, Ms. Bisset says.
“[The action desk] provides insight and guidance around investment decisions,” she says. “For example, an advisor might be working with a large family and may want to talk to another expert about making some investment decisions. They can partner with another advisor.”
Meanwhile, Peter Kahnert, senior vice president, corporate communications and marketing, at Raymond James Ltd. in Toronto, says the firm is looking to the future and the changing demographics around wealth.
Specifically, the firm has placed a focus on recruiting more women, and its women’s advisory council offers networking and practice management support.
“With recruiting women [advisors], we’re now at 18 per cent. Our goal is to try to be at 25 per cent by 2025, but that is a big stretch,” he says, adding the firm is committed to the target.
Raymond James also has a presence in universities and job fairs in hopes of attracting more young people to the industry.
For Canaccord Genuity Wealth Management, a big draw for advisors who are looking to make a move is its high retention rate, says Stuart Raftus, the firm’s executive vice president and chief administration officer in Toronto. He estimates that just one advisor has left the firm out of 150 in the past two years.
The second draw is the customized offering to help advisors build their practices.
“When we talk to advisors, we talk about our research capabilities, planning software, marketing platform and wealth and estate planning – all of which are important to top advisors in the country,” Mr. Raftus says.
He adds that advisors are trying to build practices that are different from others, and Canaccord helps them create that bespoke experience.
When asked about the lure of signing bonuses, he says it’s not the deciding factor for advisors.
“The signing bonuses are within a very tight range in the industry,” he says. “Advisors genuinely invest time and energy into doing due diligence to find the best platform for their practices. So, the money part is there, but it’s not the driver at all.”
Despite the differences in these investment dealers’ recruitment strategies, all have big goals to bring in more advisors and are targeting the ones with lucrative practices who can bring in high-net-worth clients.
“We’ve had 10 different teams join in the past 10 months, and one of them attracted a new client that [had more than] $100-million [in investible assets] in the first couple of months,” Ms. Bisset says. “So, the positioning and strategies resonate with both advisors and clients.”
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