Earlier this week, LPL Financial announced that three wealth advisors with about $100 million in managed assets would be joining the firm’s broker/dealer and RIA platforms from Cambridge Investment Research, Edward Jones and Cetera Advisors. While the independent broker/dealer has been an aggressive recruiter over the years, the coronavirus has upended the working and recruiting conditions of firms and advisors.
And even at the biggest IBD in the industry, the pace of new conversations with potential recruits has slowed, due to social distancing and remote working, said Rich Steinmeier, LPL’s managing director and divisional president for business development. The new recruits announced recently were already in the works prior to the spread of the virus in the U.S.
At the same time, incoming calls from advisors have increased, which he attributed in part to the fact that advisors are now working from home and can more freely reach out to LPL as they have more discretion during their day.
LPL has developed virtual options to recreate the recruiting experience and intends to continue its efforts in attracting new advisors, Steinmeier said.
“The biggest hurdle is just there’s a lot of volatility and unknowns, so we need to make sure we’re creating a space for prospective advisors to serve their clients. And there’s still a lot of fear out there,” he said. “We need to make sure we’re being empathetic.”
Most in-person meetings have been discontinued for the time being, with LPL using WebEx and Amazon Echo to hold in-depth discussions with potential recruits. Earlier this week, Raymond James announced that it was deferring all in-person recruiting meetings because of the coronavirus.
Steinmeier said some in-person meetings might still take place if everyone felt comfortable and safe while doing so, but there would be no flight travel; any LPL employee engaged in helping to transition an advisor would have to be able to reach them by car.
Steinmeier said LPL had also largely been able to recreate one of the final steps in bringing an advisor into the fold. Typically, an advisor would make an in-person visit to one of LPL’s home office locations in San Diego or Fort Mill, S.C., to get a better understanding of the firm. With air travel unlikely for most advisors, LPL has recreated the home office visit virtually, delivering the advisor information about technology, transition support, marketing and research. While LPL had previously offered something akin to the virtual home office visit as a webinar, the coronavirus spread marks the first time it is conducting the virtual visits one on one.
“The truth is that so much of that visit is about information sharing, and getting to know the firm’s capabilities better so they can make the best decision possible,” he said. “We can still deliver the crux of that, and we can do that without them traveling to our facilities.”
The concept of the virtual home office might extend past the end of the coronavirus crisis, he said. He also believes that advisors’ evaluations of firms would change dramatically in light of the experience. In the aftermath of COVID-19, advisors will likely look closely at those firms that managed to remain stable in the midst of the pandemic and the economic turmoil it caused.
“We’ve learned that the recruiter or advisor on the other side are not losing much in this. There’s still the handshake, kicking the tires, that won’t really go away, but there’s a lot of digital savvy advisors who see that we have robust videoconferencing abilities and e-sign,” he said. “This is a leading indicator of the capability of your tech stack, so (advisors) may have more confidence in your ability to engage me sufficiently.”