I'm a CPA and registered representative of Nathan & Lewis Securities. We're located in Feasterville, Pa., a short distance from Philadelphia. Prior to going independent I was with Josephthal for 12 years, until 2001 when they were sold to Fahnstock. Since I didn't want to start with a whole new management, I decided to go independent.
I must say I didn't leave anything to chance when it came to going independent. To begin with, I had a rehearsal period for independence; in 1997 I set up a satellite office for Josephthal in my house after having been with them in New York. That satellite office gave me the trappings of independence. It gave me the freedom of independence without the expenses.
I'm 39 now. At 32, understanding I was going to be in this business forever, I started making plans for going independent, although I would have stayed with Josephthal had they not been bought.
Over the years, I talked to a dozen reps to find out what I would need, the problem spots, the challenges--what I need to pay special attention to. I knew I would need pricing for all the components well before deciding to go independent. I set up a checklist on a spreadsheet and went through all the priorities: computers, telecommunications, supplies, office furniture, leasing space, announcements. I also figured out which accounts I would invite to come with me and what I would need to do to get those accounts over to me.
When it came to choosing a broker/dealer, I did it with the same diligence. As I said, I had a guerilla system of 12 independent people I could talk to. They told me to look for a broker/dealer with deep pockets, a firm that cleared through the same clearing firm I was using so my clients' statements would look the same. Knowing all that, I made another spreadsheet and compared the six broker/dealers I chose to talk to. I listed everything from the payout I would be getting to the expenses I would be paying. I was looking for the most drop to gross revenue but I was willing to pay for support like research and technology.
Did I get the business I needed from the business I had? Well, since my clients always understood they were doing business with me, no matter whose name was on the door, I was able, within one month of opening my doors, to attract $118 million of the $125 million I was managing.
I'm doing it with two people and myself. I should get to $200 million by the end of 2004 with three people and myself. And to get to $500 million, I'll need a staff of five plus me. My model is to grow by duplicating the top 20 accounts I have every year, to keep having larger and larger accounts and to have a maximum of 200 to 225 relationships.
What's my specialty? I'm not a stockbroker. I'm a financial planner, I do wealth management. I look at where someone is, where they need to be vis-a-vis wills, insurance, assets, special needs, spendthrift or responsible kids, health challenges, serious illness.
My clients are not trying to make 20 percent. They're generally wealthy and trying not to be poor. Their goal is to live the way they're living for the rest of their lives. Is there a way to save on some taxes? Is there a way to preserve the wealth? How can their heirs get the biggest chunk of what they're leaving and the government the least amount?
Yes, I have clients who are down, and so is my business. My clients who are down get a letter from me every month and they get a phone call to meet with me once a quarter so I can explain everything.
The education process is important. So is letting your clients see your face even when things aren't great.
The Firm: Nathan & Lewis Securities,Feasterville, Pa. Principal: Scott Holstein B/D Affiliation: Nathan & Lewis Year of Independence: 2001 Assets Under Management: $118 million I'm a CPA and registered representative of Nathan & Lewis Securities. We're located in Feasterville, Pa., a short distance from Philadelphia. Prior to going independent I was with Josephthal for 12 years, until 2001 when they