Having started his advisory career at Smith Barney in 2008 – just two days after Bear Stearns was sold to J.P. Morgan for $2 a share – Steve Schwarzbach witnessed first-hand how quickly culture can change. The once advisor-friendly, client-centric model that Smith Barney was known for disappeared day-by-day after Morgan Stanley purchased the firm.
He and his partner started exploring their options soon after but didn’t feel that the independent space was quite right for their business at the time. Yet it continued to get increasingly difficult to serve their clients, and as Steve says, “We felt like we were being told ‘no’ more often than ‘yes.’”
It was the realization that the wirehouse’s need to “protect the firm and the franchise by managing to the lowest common denominator” trumped serving the best interests of their clients that propelled them to start exploring again.
So, in 2017, the Houston, Texas-based $800 million RIA firm Icon Wealth Partners was born.
In this episode, Steve discusses:
- Why he and his partner felt independence wasn’t right for their business when they first started exploring in 2009—and what changed their minds further down the road.
- Why they didn’t make a move to another wirehouse—and what other models they considered.
- How the need for alternative investment products had become a factor in their decision-making process—and also hindered their initial consideration of moving to the independent space.
- Why they opted to use a service provider—and why Dynasty Financial Partners was the right fit for their business.
- How they framed the message to clients about leaving a big firm like Morgan Stanley—and what key factor resonated most with the clients.
- Plus, Steve shares how they have been able to attract more high net worth and ultra-high net worth clients since building their own firm—even without a big brand name behind them.
Aside from regaining the power to define their firm’s culture and the ability to offer best-in-class products and services, the real benefit of independence, Steve says, is being “unencumbered by a big firm agenda.” And for most advisors and their clients, that’s the biggest benefit of all.