In one of the first sessions at this year’s annual RIA Edge conference in Hollywood, Fla., Diamond Consultants President Louis Diamond spoke with CEO of ShoreHaven Wealth Partners Mike Durso about making the move from Morgan Stanley in July 2020.
The firm spent three years planning the move with support from Dynasty Financial Partners, which it now uses for back office support, a decision Durso said he has never regretted.
The discussion, said Diamond, represented an “unplugged” continuation of a conversation the pair had in late 2022—about four months after Durbin stepped into the role formerly held by his father, Larry Durso.
With a background in asset management, Mike Durso decided he wanted to join the family business in 2016. At the time, his father had been with Morgan Stanley for about five years, following more than three decades at firms such as Merrill Lynch, Prudential Securities and Wells Fargo.
“Before I joined the business, one of the biggest stipulations was that we were going to launch our own [RIA],” said Mike Durso.
Durso said his previous work with firms in the space opened his eyes to the benefits they could provide their clients, and he was concerned about his father’s legacy at the wirehouse.
He also felt the model was too limiting in terms of how they were able to drive new business to the practice and the products they were able to use in their models, he said—and Morgan had been pushing lending services for clients who didn’t need them.
The decision to partner with Dynasty was made early on. “One thing that was incredibly important to us was owning and operating our own RIA underneath our own ADV,” said Durso. “At the time, there weren’t many options to do that.”
The team sat down with firms like Hightower, United Capital, LPL and Raymond James, as well as various technology providers to determine whether they should go out entirely on their own.
“That was a little bit too far away from what we wanted to do and a little too in the weeds,” said Durso. “The supported independence model made a lot of sense for us—incredibly so.”
The Dursos signed a contract with Dynasty in 2017.
“Much of it came down to [Dynasty's] understanding of the RIA market and their understanding of how important it was to us to be true business owners,” Durso said. “And they've lived up to that throughout the years. We use technology that Dynasty doesn't have at any other firms. We use a TAMP that's outside of Dynasty's purview that we think is best for our clients, and there's been no pushback. They've supported our business and allowed us to really run on our own.”
“Mike is kind of on the earlier edge of embracing this supported independent ecosystem,” noted Diamond. “But now it's roaring, and most teams that we see break away—that aren't joining existing RIAs as employees—they're opting for a supported platform, even if it's going to cost them a little bit more money.”
Durso said the partnership with Dynasty made the transition considerably smoother than it might otherwise have been. The firm provided a checklist with more than 100 benchmarks to accomplish and would meet with the team weekly for two or three hours to plan around platforms, technology, branding and more.
“There was nothing that was really overwhelming,” Durso said. “I was able to solely focus on launching this business and driving the strategy and the due diligence, bringing Mike [Lombardi] and my father in where it was relevant but kind of letting them do what they did day-to-day with clients.”
He said the partnership with Dynasty, combined with technology the firm has invested in, enabled the five-person team to operate more like a firm with 50 employees.
“That's what I'm selling when I talk to wirehouse advisors trying to bring them into our business,” he said.
“You really have to present yourself with the right amount of support and scaffolding to attract these folks to the organization,” agreed Diamond.
“More than half of folks who are going to transition in a given year are going to stay within their familiar channel,” he said. “If you're at Morgan Stanley, you're much more likely to go to UBS or Merrill or Wells Fargo certainly than to go independent.
“It seems like a complete no-brainer to me. Why wouldn't I want more choice, business ownership, better economics, more fun? He can dress casually whenever he wants to and have a great beard. It sounds amazing.”
Based in Red Bank, N.J., ShoreHaven currently manages around $400 million for more than 200 clients in 32 states.