H. Beck, a mid-size independent broker/dealer acquired by Kestra Financial in 2017, is ramping up its recruiting efforts with a new brand, a new technology platform and what executives say is a more "formalized" service model. The firm also added an IAR-only affiliation model where advisors can drop their FINRA license and operate solely under the IBD’s corporate RIA.
Prior to Kestra, H. Beck was owned by Securian Financial Group, an insurance company. The H. Beck name, which has been around for 37 years, will go away, and the IBD will now be known as Grove Point Financial.
“We have a new story to tell,” said President Michelle Barry. “We’ve transformed a lot of the firm’s offerings, from the technology we offer to the product platform to the IAR model that we have available for wealth managers. We really feel like Grove Point Financial is now a better way to connote a transformed, younger, modern platform for new advisors.”
Since Kestra’s acquisition of H. Beck, the firm has brought on an entirely new executive team, including Barry, who was hired in late 2017. Chief Compliance Officer Jason Albino joined the firm in 2018; Rob Costello came on in January 2020 as chief operations officer; and Robert Engle came over from LPL as new head of business development earlier this year.
Engle will lead the firm’s recruiting efforts and try to lure advisors with the new brand and a refreshed platform. The firm currently has about 500 advisors.
Barry said the firm has replaced almost all of its old technology with a new advisor desktop system. While Grove Point does not allow for multiple custodians, the new tech platform provides a completely digital experience, Barry said. Advisors can now open accounts online, use e-signature and have access to different software.
Advisors can choose one of three financial planning tools that now push data into its proprietary tech suite, including eMoney, MoneyGuidePro and NaviPlan. Advisors also now have some flexibility in terms of the performance reporting software they can use within the system. Advisors can choose from Investigo, Albridge and Black Diamond. The firm also has a partnership with Riskalyze for risk profiling.
“Despite being a traditional independent broker/dealer, we’re really looking at ourselves as a partner to wealth managers,” Barry said. “That means a world where you really have to have optional financial planning tools and options for their reporting to clients, instead of just a classic ‘This is our offering. Take it or leave it.’”
The firm’s advisor portal, where FAs can open up new accounts, view their information and check compensation, is the same for everybody.
Grove Point has also revamped the product platform, enabling advisors to work with lower-cost institutional share classes. Advisors can now act as the portfolio manager themselves, or outsource the investments to strategists, all on one platform.
“You no longer have to go to classic TAMPs, where the assets are held elsewhere,” Barry said. “You can all have it on our chassis. You can manage some of the client assets yourself. You can outsource some to quality money managers or strategists, and you can see it all in our proprietary platform.”
Barry said there was also demand from existing and new advisors for an IAR-only affiliation model. The new technology system has been built with that in mind, she said.
“Other firms will be challenged by that because they have some core, legacy technology or systems in place that always assumed you were dually registered,” she added. “We have intentionally built an offering in mind that does not require a FINRA registration, because we do see that movement in the industry.”
There are currently two teams in the IAR-only model, but others in the pipeline, including existing advisors whose commission business is drying up.
“You may want to take the step of staying with us, dropping your FINRA registration, having the corporate RIA do much of the work advisors don’t like—operations, compliance, back-office servicing,” Barry said. “We would be that for them, and then they would act as a very independent investment advisor only with us.”
Barry said the firm has also formalized a concierge service model, where each advisor is assigned to a team of about five to six home-office staff who will support them on a day-to-day basis, including folks in operations, supervision, compliance and technology.
“We understood that advisors like to form relationships with certain people in the home-office,” she said. “What happens is, we get very familiar with their business; they get very familiar with the team that they’re working with. And we think it drives faster service, better relationships and no longer does the advisor have to hunt around and work through voice response units or whatnot. They just call their team number.”