Every advisor is different, but a striking number have the exact same three priorities when switching firms: a big transition deal, a fertile source of high-net-worth referrals and a 90 percent payout rate.
It goes without saying that the vast majority of job seekers need to compromise on at least one of these wish-list items if they are truly interested in finding a new job. The first step lies in ranking the requirements in order of importance. Once this is done, an advisor can embark on the most important part of job hunting: comparison shopping.
It sounds like a simple enough process — just examine prospective employers side by side and evaluate which one offers the best chance of attaining the most important items on a list of priorities. Unfortunately, gathering the necessary information about the firms can be time consuming and, ultimately, confusing.
Here are several categories of information that can help guide a job seeker's evaluation of advisory firms.
- Branch environment — does it promote growth?
- Name recognition of firm.
- Flexibility and entrepreneurial spirit.
- Lifestyle satisfaction of firms' advisors.
- Product and technology offerings.
- Transition package.
- Transition assistance.
- Compliance counseling and support.
To get started, devise a system to keep track of the differences between opportunities and the firms. Soon afterwards, the pros and cons of each firm will begin to emerge, as will the differences and similarities between opportunities.
“Target” advisors have the widest range of choices. (These are those with production in excess of $400,000, on at least $40 million in assets under management, with a book that is in excess of 30 percent fee-based, a clean compliance record and an employment record with no more than three previous brokerage firms in the past 10 years.) If you are a target broker, you are likely to be confronted with a welcome problem: an overwhelming number of employment choices.
For targets that want a wirehouse position, a job search can be launched simply by contacting branch managers at the firms. A recruiter can help the matchmaking process along by weeding out opportunities that are bad fits and by helping negotiate a compensation arrangement when a fair fit is found.
A Time to Change
As job searches wear on, it is not uncommon for an advisor's notions of what he wants from a new position to shift. For instance, I recently worked with a successful independent advisor who wanted to change broker/dealers while remaining independent. This advisor, a $1.1 million independent producer with $200 million in assets under management and a book that was 80 percent fee-based, also was hoping for a decent-sized transition package (he was in the process of renovating his home). But a funny thing happened during the search process — he realized that the support and compensation structure at wirehouses might serve his purposes better in the long run. He is currently evaluating wirehouses and quality boutiques like Bear Stearns and Deutsche Bank.
For nontarget advisors — those missing one or more of the traits that make targets so desirable — the issues are different but the job search process is the same.
An advisor with high production and a few U4 dings, for instance, is not attractive to the wirehouses, but he might well find a comfortable home at a regional or boutique, depending on the nature of the offenses. For the nontarget broker, a recruiter's involvement can be crucial because of their in-depth knowledge of the opportunities out there and because of their familiarity with the tolerances of various firms for professional blemishes.
No matter what an advisor's career path to this point, a comprehensive exploration plan is advisable. It calls into high relief a job searcher's options and sometimes even introduces some new ones.
Writer's BIO: Mindy Diamond founded Chester, N.J.-based Diamond Consultants, which specializes in retail brokerage and banking recruiting (www.diamondrecruiter.com ).