Philip Palaveev

Registered Rep: What attracted you to Fusion? Philip Palaveev: First of all, the fantastic group of advisors Fusion currently has some of whom were my clients at Moss Adams many of whom have become friends. Second, the great partner and friend I find in Stuart [Silverman, CEO] going to Fusion does feel a little bit like returning home. Last, but not least, the opportunity to grow and have a dramatic

Registered Rep: What attracted you to Fusion?

Philip Palaveev: First of all, the fantastic group of advisors Fusion currently has — some of whom were my clients at Moss Adams — many of whom have become friends. Second, the great partner and friend I find in Stuart [Silverman, CEO] — going to Fusion does feel a little bit like returning home. Last, but not least, the opportunity to grow and have a dramatic impact on how the industry thinks of advisor affiliation and advisory organizations. I am a bit vain, too, after all.

RR: Why is Fusion looking to expand into the RIA space?

PP: Fusion's focus is really on the advisor. How the advisor is regulated is just a nuance. We want to work with independent-business-owner advisors, and it doesn't matter to us if they are RIAs, affiliated with a broker/dealer or both. I think this has always been Fusion's philosophy.

RR: Who is Fusion's target advisor or RIA?

PP: Entrepreneurs who have realized that they need to manage their practices, and who have come to one of the crossroads in building their businesses. Also, advisors who have a tough time catching the attention or the best resources of their infrastructure partners. If I had to quantify it, I would say advisors with anywhere from $200,000 to $3 million in revenue, but it is really not about the revenue — it is about the underlying business, culture and client philosophy.

RR: Do you see any major shifts happening in the RIA industry in the next few years?

PP: The talent shortage will be the number one issue. Related to it, the transition of ownership to the second generation will be a defining moment for many firms. From a macro perspective, new service firms will come to challenge the existing custodians and perhaps the custodial model of service as well.

RR: Do you think firms like Merrill Lynch and other wirehouses will become big players in the RIA custodian business?

PP: I am convinced that Wall Street firms will participate in this market, but I don't know if it will necessarily be in the custody model — at least not in its current form.

RR: What about LPL?

PP: It is a growing, evolving, innovative and ambitious company that already is a formidable force in the advisory industry. I think, overall, the industry only benefits with the addition of every new competitor that brings more services, new technology and new business models.

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