Partnering with CPA/Attorney

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May 11, 2009 4:20 pm

Any independant RR or RIA's that have formally partnered with a CPA and attorney to form their own practice?  In other words, created a firm with wealth management, taxes, and estate planning/legal services? 

 
This is a potential long-range plan for me, so I was just curious what experience others have had with this. 
May 12, 2009 9:58 am

Any thoughts?

May 12, 2009 12:20 pm

We've partnered with a CPA firm and they have an office in our suite and we have access to a meeting space in their building.  We use two estate planning attorneys that meet with our clients in our office.

 
But as for a CPA or attorney being a part of our firm, we haven't gone that far yet.  I can see how it could be extremely beneficial.
May 12, 2009 12:40 pm

How would everyone be paid?  I have an estate attorney that won't take any money from any advisor or split of any sale for ethical reasons and conflict of interest.

 
But I would think a joint venture with an established CPA and advisor would be a great idea. 
May 12, 2009 1:29 pm

It'll be like Walmart where you can buy tires, milk, and a wedding ring, all in one convenient location! :)

May 12, 2009 2:01 pm
haulin79:

It'll be like Walmart where you can buy tires, milk, and a wedding ring, all in one convenient location! :)

 
Obviously a very flawed business concept, wouldntchasay?
May 12, 2009 2:46 pm

No, not the "Walmart" thing.  My thought is that you all operate under one "umbrella" firm, but each bills separately, and you each have your own LLC (or whatever business model you take on).  But to the client, it is all part of the same firm.  You could either be partners just in the "umbrella firm" just sharing costs/overhead, or (and I doubt this could work) you could actually become partners in revenue as well.  There would be obvious cost savings through sharing office space, website, literature, supplies, maybe staff, etc.  But the real benefit would be access to each other's client base.  If you are going to get your taxes done, you would see and get introduced to a financial advisor and an estate attorney.  Not that you would have to do any type of "packaging", you are really just leveraging each other's resources, clients, and exposure.  And clients would view the firm as a more "comperhensive" wealth management firm with greater resources.

 
Imagine if an attorney, a CPA and an advisor each brought a few hundred clients to the table.  Let's say in total, you have access to 1,000 clients.  That's a lot of exposure.  And most of those people all have money (generally enough money to use a CPA, an estate attorney, and an advisor).  You may even consider an insurance specialist if you could find the right fit.
 
There are some large "family office" type firms that do this, but the economies of scale make it easier.
May 12, 2009 5:25 pm

The formation is loose and informal enough that there are no or minimal downsides.


Basically, what you are saying is a getting a number of select professionals to put the same business name on their business card. Simple enough.
May 12, 2009 5:36 pm

i think the idea could work if done properly. Almost all banks, even the small ones, have some sort of Private Client group that does exactly this.  Everything is done in a team based scenario.  Each member of the team has input into what goes on with the client.  Lawyers set up trusts, wills. . . Advisor manages portfolio. . . CPA handles books. I suppose you could charge one fee for the whole deal or make it ala carte.  Not necessarily something you want to do with a 100k client but at million or more great way to generate revenue and keep clients from going outside. 

May 12, 2009 10:19 pm

I guess that would be the idea ultimately. In the beginning, it would be more about just getting each of us to cross-refer, not necessarily being a "family-office" where we just handle all your affairs for a fee. I am not in an area with enough UHNW people that would need that type of service. I am thinking more about the guy with $1mm that needs his taxes done and his estate docs completed.



Maybe at some point we could swim upstream, but I don't think the initial concept would work that way.



And keep in mind, this is just one of those "far out there" ideas that I have had, that I may want to do some day. And I have only loosely identified people I would want to partner with at this point.

May 13, 2009 9:03 am

Your secret's safe with us, B.

May 13, 2009 9:06 am

B24 is probably a Jones advisor that everyone in the region and home office loves. They have got to be panicking trying to figure out who he is at this point. I would love to be a fly on the wall...

May 13, 2009 10:10 am

B24, I had similiar thoughts before heading out Indy.  Once the smoke cleared and I got my feet under me, I discovered the same CPA's and attorney's who I tried to partner with at Jones, were more willing to refer clients once I opened my own business.  I could go into the reasons I think the 180 took place, but I won't. I've found that a partnership is not needed.  I refer to them, they refer to me...AND I have more than 1 I work with.  I'm not sure you would get much from other professionals if you are partnered with one and the same.

What I will do is ask you why you want to partner with anyone? Partnerships vary rarely work.  If you hired them and they were on your payroll, like Ron Carson type office, I understand.  Is there a fear of not getting clients or the fear of opening your own office?  It was such a drag everyday at Jones, calling and calling, that I had the same fear before I went Indy.  I have found the exact opposite.   You will never know what the Indy's talk about until you do it.  I wouldn't do it any differently and I have no fear of not making it in this enviroment, none. 
May 13, 2009 11:46 am
Moraen:

B24 is probably a Jones advisor that everyone in the region and home office loves. They have got to be panicking trying to figure out who he is at this point. I would love to be a fly on the wall...

 
I agree. The guy is far too sharp and too much of an independent thinker to be giving 61% of his income to Jones.
 
He'll be loyal to the end, but he won't be around more than a couple years.
 
 
May 13, 2009 1:20 pm
bspears:

B24, I had similiar thoughts before heading out Indy.  Once the smoke cleared and I got my feet under me, I discovered the same CPA's and attorney's who I tried to partner with at Jones, were more willing to refer clients once I opened my own business.  I could go into the reasons I think the 180 took place, but I won't. I've found that a partnership is not needed.  I refer to them, they refer to me...AND I have more than 1 I work with.  I'm not sure you would get much from other professionals if you are partnered with one and the same.

What I will do is ask you why you want to partner with anyone? Partnerships vary rarely work.  If you hired them and they were on your payroll, like Ron Carson type office, I understand.  Is there a fear of not getting clients or the fear of opening your own office?  It was such a drag everyday at Jones, calling and calling, that I had the same fear before I went Indy.  I have found the exact opposite.   You will never know what the Indy's talk about until you do it.  I wouldn't do it any differently and I have no fear of not making it in this enviroment, none. 
 
I would not even consider putting them on my payroll.  My thought is more of a formal office sharing concept, where we "appear" to be part of the same firm, but in reality, we each have our own revenue stream and simply share the name, the office space, and the overhead.  It's more to leverage the skills and resources of each other, and obviously access to each other's clients.  But your point is very valid, it may work without the formal partnership.  It's just something I have explored.  The other issue I haev to deal with is that there are only a few CPA's and attorneys in town worth dealing with, and most have long and stable bonds with long-time advisors (all wirehouse guys that I know).  So it's been tough to crack that bond.  And believe it or not, most of them actually look at Jones more favorably than most of the wires (Merrill is not well liked in our area, nor is AG Edwards/WACH/WF - mostly because of some specific advisors, not the firms themselves).  The CPA's in town are odd.  A few are adamant fee-only types, and a few are A-share commission-only types.  One prefers indy firms, the other works with two specific Merrill guys, almost exclusively.
 
And before everyone starts writing my obituary at Jones, keep in mind I have no plans to leave anytime soon (if at all).  This past year has changed my perspective on some things a bit.  I just feel that you always have to know what the options are if you work for a captive firm, and not get caught with your pants down (except on Fridays ).
May 13, 2009 2:34 pm
Moraen:

B24 is probably a Jones advisor that everyone in the region and home office loves. They have got to be panicking trying to figure out who he is at this point. I would love to be a fly on the wall...

 
 
I have a feeling they know exactly who he is...and who all of the rest of us are, for that matter.
 
May 13, 2009 3:11 pm

That's why I never went on these forums while I was at Jones... I hope my supervisor doesn't catch me now!

May 13, 2009 3:21 pm

May 13, 2009 3:24 pm
Borker Boy:
Moraen:

B24 is probably a Jones advisor that everyone in the region and home office loves. They have got to be panicking trying to figure out who he is at this point. I would love to be a fly on the wall...

 
 
I have a feeling they know exactly who he is...and who all of the rest of us are, for that matter.
 
 
Doubt it.  I play some "tricks" to throw anyone off trying to identify me.  But I guess if they tried real hard they could find out.  But, not sure they try that hard.  Based on the number of Jones FA's on this forum, I don't think it's worth their time.
May 13, 2009 3:27 pm

OR, based on the number of Jones FA's on this forum, it IS worth their time!