Stringer: You can’t ignore the technology advancements that are happening. You’ve got to embrace them, and
you’ve got to innovate and stay current. You’ve got to move forward with
But there are some basic things that
just stay — like having a clear value
proposition. We’re building our firm
very much like a good advisor will build
their practice, with a clear value proposition, scalable business processes and a
great client experience.
We know people value the fact that
40% of our advisors have been with
us for [at least] a decade. And the only
reason this is at that level is because we
keep adding new advisors.
We just have people who value that
experience, and we have not found that
we’re behind the curve on technology —
because we stay in the business; we par-
ticipate. We understand what people
are doing out there, some of the changes
that are taking place and are trying to
advance the ball with all that. But we
also try to stick to our knitting. We’re a
boutique firm, and we’re trying to be the
best boutique firm we can be and are not
trying to compete on scale.
For us, the driver that we follow is net
asset flows. If net asset flows are coming
in for an advisor and for the firm, we’re
growing. If we get net outflows, we’re
shrinking. And with compression going
on, you’ve got to have more assets to
make the same amount of money. That
to me is a driver for how you build a
scalable business, whether you’re at the
advisor level or at firm level; it’s working for us.
Webber: It’s interesting being [differ-ent in terms of size] but still very similar.
Start with your value proposition, and
ours is client experience, an intimate
client experience. The trick for us has
been scale and still maintaining that client experience, as it is still in demand.
And that’s where the technology comes
“You can’t ignore the
technology advancements that
are happening. You’ve got to
embrace them, and you’ve got
to innovate and stay current.
But there are some basic things
that just stay — like having a
clear value proposition.”
but everything else is all over the map. You’ve got to filter it,
and that’s a lot of work. So we have data loaders, and we do
[this work] at odd hours, because the data has to be ready for
business [in the morning]. It’s quite complex. I don’t see that
being done easily by small firms; they may need more [help
from] the clearing firms.
Now, if the regulators would understand that they could
create more scale and also more safety for the investing public
because big data is the answer; but they need to force a common structure. There’s no standard for financial-services data
in the United States. It’s all over the map.
Webber: Another threat that’s somewhat connected but different is that we’re independent, privately controlled [firms],
and that’s at risk on a fairly regular basis.
We want our companies to be here long after those
of us that are in our chairs today are gone. But we’re
competing against an environment that is dominated by
When you’re out there competing for the short term, think
of it somewhat like junk bonds vs quality bonds, right? When
you’re competing for the short term, you can throw money in
different directions and sacrifice long-term profitability for
short-term revenue growth. And the competitive deals and
decisions that we see going on out there worry me sometimes.
Perhaps the value proposition that we have so fiercely pro-
tected is a dying breed.
Dolber: That’s a good point. Our [BD] conference in October
is coming up. What am I going to talk about? Why are you all
here? Why do we come together?
I get calls all the time to sell the company. I don’t sell
because, like you said, I want to build something that lasts
I don’t want to see the company destroyed or merged.
I want to see it survive. So I’m going to ask that question
at my national convention: Why are you here? Can we talk
DeVito: Can we survive past the next 15 years? Fifteen years
ago, all the insurance companies were in the business
Webber: Now it’s private equity.
Stringer: It’s all short-term capital.
IA: What’s your view of challenges tied to Amazon’s impact on the broader business world and
investors’ rising expectations about quick, high-quality digital-based service? How do you make
this an opportunity?