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60 Seconds With...Lon Dolber

Interview with Lon Dolber, President of American Portfolios

Lon Dolber
(President American Portfolios)

Lon Dolber grew up in the independent brokerage business. His father, a former entertainer, started with First Financial in the 1950s. Lon joined the firm in 1979 and eventually moved on to Nathan & Lewis. In 2001, Dolber decided to launch his own firm, American Portfolios Financial Services. With outsourced technology and a focus on rep service, Dolber says, American Portfolios is the very model of a modern independent b/d.

Registered Rep.: American Portfolios opened for business on Sept. 11, 2001 — not an auspicious moment.

Lon Dolber: I got to the office a little before 9 a.m. and I saw the first tower burning. I called my wife and said, “I think we're going out of business.” In the following weeks, I saw the determination of the firms that had been hit by the tragedy. I said, I'm sitting here on Long Island, with everybody safe. If they can make it, I can.

RR: What happened next?

LD: It turns out my timing was terrific. If I had tried to open on Oct. 10, nobody would have come over to join me. And I was lucky I didn't do it in '97 or '98 when b/ds were doing all sorts of crazy things that were not core. I came in when regulations were getting harder and I had the advantage of a climate where you had to look at every cost.

RR: What else?

LD: Technology. I outsourced everything. The only thing I built was a framework for delivering things like Albridge (account aggregation) and Exstream (statements). No b/d can do in-house what Albridge does. It was a strategic decision to outsource. (See page 69 for a related story.) I built a firm like a modern computer, with expansion slots to add new functions. If I don't like a bond program or a clearing house, I can take them out.

RR: What kinds of brokers are attracted to Amercian Portfolios?

LD: I hire only experienced brokers with $250,000 in gross. On average, no more than 25 percent of their business is fee-based. We stick to our knitting. We don't have practice management and coaching. Who's going to pay for it? My attitude is: I am not going to select managers for you or hold your hand. I will pay you, keep you compliant and give you reporting.

RR: Where do you stand now in size and what are the challenges?

LD: We went from $6 million in revenue in year one to $28 million in year four. We now are doing about $11 million a quarter. To be profitable, that's the big challenge. If you don't rely on revenue sharing and if you don't have a parent that manufactures product, it's very hard to make money. You have to be very lean. We have 33 employees (for 400 reps).

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