All By Myself

All By Myself

You don’t have to give up the best tech toys when you go independent, but the learning curve can be steep.

When Brett Davis first considered leaving Merrill Lynch to go independent in 2008, he took one look at the technology available, and he and his partner, Steve Altman, backed away.

But now it’s a different story. Still hungry to be on their own, the two noticed something had shifted in terms of the software they’d need to open their own shop: Systems now talked with each other, platforms were easier to navigate, and there was a plethora of options.

“When we looked in 2008, we thought this would be a disaster with our clients, because I would spend all my time making the stuff work,” says Davis, founding partner and senior wealth advisor with the Davis/Altman Group. “When we looked eight months ago, we realized a whole industry had sprung up supporting people like us.”

Davis and Altman joined forces with another Merrill team, Todd Gescher and Jason Herber, co-launching True Private Wealth Advisors, a Salem, Ore.-based independent firm, in September. As part of their preparations, they turned to an outside firm, Dynasty Financial Partners, to guide them in building their internal technology platform.

“At Merrill Lynch, everything had to be out of the box,” says Herber, Gescher/Herber Group’s founding partner and senior wealth advisor. “Here we can change and structure things the way we want to use it.”

Independents hardly have to trade in robust technology when they go out on their own. Today, many self-starters count on software catering to independents—programs that speak to each other, share data, and are priced affordably. You don’t have to give up the best toys when you go independent, but you do have to be patient in that the learning curve is going to be steep.

Baby Steps

While platforms and software available to independents, such as Black Diamond Performance Reporting or MoneyGuidePro’s financial planning software, do integrate more easily together, there are still going to be hiccups—as at any firm. Computers are going to lock up; platforms are going to malfunction. At a large regional outfit or a wirehouse, support is just a phone call away. But as an independent, you are the IT department in most cases.

“What was very nice and easy at Merrill Lynch was we could pick up the phone 24 hours a day, seven days a week and get our issue resolved and taken care of,” says Herber. “At this point I’m hustling around the office to get things squared away, although I think that will get easier.”

Brian Smith, founding partner of independent firm CastleRock Financial Advisors in Collinsville, Okla., also misses the IT support from his former regional firm, which he declined to name. There, he had a “perfect suite of products” that integrated well together, meaning data from one program would move automatically into another.

After launching out on his own in April 2011 with his partner Stacy Brown, Smith managed to put together a suite of options from Redtail Technology for their customer relationship management (CRM) software and Investigo as their integration tool. Everything works, he says. But 18 months out, Smith still admits he has yet to find the perfect solution—platforms don’t communicate as well with each other. They don’t share data or make it easier to move from one program to the other.

Yet Smith stands by the decision to go solo. He knew they would have to invest some time in building a custom suite of products for their business. That included the hiring of an organizational manager, who handles most tech concerns—a relief to Smith, who admits he’s not the savviest when it comes to IT.

“It’s best to have someone on your staff, and if you can’t afford that, then at least have someone lined up that’s outsourced,” he says. “We have things that come up monthly, and that can be a productivity issue.”

Integration Frustration

Finding programs that share data between each other and allow reps to access several apps with one login is not a small concern for independents who are already shouldering a lot of other responsibilities as solo practitioners. Irritation in this area can run deep.

“Much of the frustration we see is on the integration of software because there’s a lot of different software and tools,” says David Lo, director of wealth management practice at global research firm J.D. Power. “What we see is that firms score better not necessarily because they have better tech, but [because of] the support. If people don’t know how to use something, and there’s no support behind it, then they’re going to have a problem.”

Software firms as well as broker/dealers, eager to draw business from the burgeoning ranks of reps going independent, understand this well, and are working fervently to ensure programs integrate, while also providing support where reps need it.

TD Ameritrade has put considerable muscle behind their Veo platform to ensure it works with programs such as Redtail on the CRM side or MoneyGuidePro, among others. The company recently launched an Integration Analyzer allowing its own advisors to easily see where they could find more Veo-supported products that talk to each other—potentially eliminating multiple sign-ons, or having to re-enter data between windows and programs.

On the software side, CRM firm Junxure recently integrated with Schwab’s Advisor Center, and is currently testing its system with TDA, while MoneyGuidePro boasts integration with more than 35 partners including Black Diamond, Redtail and Junxure.

Yet, even with this push to streamline technology for independents, wirehouses still have some advantages, says David Schehr, research director at Gartner Industry Advisory Services. These tend to be in areas like handling complex structured products—the kinds of investments used more often by high-net-worth clients.

But that advantage may be waning, believes Schehr—and not because independent software programs are muscling into this territory—but because clients themselves appear to be looking for simpler, more cost-efficient investment options, and are fine with the fact that independents may not be able to handle more complex products.

“If you look at how clients are shifting money to the independent side, you can see that some of that complexity may be adding value, but it also may be adding cost,” Schehr says. “For reps who have clients that have $20 million, they may have more complex needs, and independent products may not be as smooth. But how many reps spend time in that area?”

Client Experience

Ultimately, integration concerns may be more of a perception issue rather than a reality, believes Michael Kitces, partner and director of research at the Columbia, Md.-based Pinnacle Advisory Group, which uses Salesforce for its CRM, Portfolio Center for its portfolio management and MoneyGuidePro for its financial planning platform. Kitces, who worked under a broker/dealer in his early days, believes that independents who leave large firms may get hung up on the idea that they’ll be allowed to design their own systems. The reality can be less exciting.

“Everyone wishes the programs did a better job integrating, but what they want is a program integrating their way, and doing their thing,” Kitces says. “That’s really about personalization. When you’re a captive firm you don’t really have a choice. When you’re on your own, you do. So that’s made it challenging to a lot of firms who each want their own slightly different solution.”

Many advisors seek help from their broker/dealer or clearing and custody firm such as Commonwealth or TDA, which can at least provide a proven series of technology options, pre-vetted and tweaked so they work in tandem together. Herber and Davis instead hired Dynasty Financial Partners, who helped pick a suite of technology platforms for their firm. Dynasty worked as buying co-op, says Davis, while also supplying research, reporting and custody capabilities on their platform.

A number of Dynasty’s leadership team, including Founder, President and CEO Shirl Penney and Senior Vice President John Sullivan, have a wirehouse background, so they understand the challenges that reps can face when they go out on their own. Sullivan hand-holds reps through the early stages in particular, and flies out regularly to client offices—spending the week before and after True Private Wealth Advisors’ launch, for example, to assist as they opened their doors.

“The teams we talk to have a lot of trepidation,” says Sullivan. “They want to know how they are going to do this, how they will replace the technology to fulfill their clients’ needs.”

Ultimately it comes down to the client. Whether that’s making sure their portfolios are being balanced, trades are going through, plans can be accessed or even personal data retrieved about a client’s birthday—the technology only works well, when a rep feels he can take care of his business.

“Before we went independent, we met with some other RIAs in the region, and we were scared because they were having horrible problems from getting their client reporting and even billing done,” says Davis. “So we wanted to make sure we could hit the group running. We didn’t want to bring in three people every quarter to do billing. But we also wanted clients to have a good experience.”          


These technology vendors make it easier to go out on your own:


Black Diamond

Pricing: Based on assets placed on the platform (e.g., basis points). Basis point pricing is tiered based on size of business and services provided.

Newest upgrades, adds: Multi-custodial rebalancing solution that rebalances across the entirety of the client relationship—at multiple levels—regardless of where assets are held; the ability to track and report on alternative investments such as private equity and hedge funds; integration of Advent Custodial Data feeds.

Contact: 1-800-727-0605;


Profiles Professional Premium v10.5

Pricing: Individual all-inclusive licenses are $1,500. Discounts are available based on volume, long-term commitment, and affiliation with a particular company. Branding is available.

Newest upgrades, adds: Ebix SmartOffice and TD Ameritrade Veo integration, Retirement Scenarios and Progress Reporting. Coming fall 2012 is a new, refreshed user experience and an enhanced consumer-facing tool.




Pricing: Generally $30 to $40 per user per month, depending on firm’s size. Clients are billed annually. Additional fee for new customer training and consulting, data migrations, etc.

Newest upgrades, adds: Recent versions of Junxure have added enhanced account tracking (including integration with Schwab Advisor Center), more robust insurance tracking, improved contact data management, more streamlined workflow tools and enhanced security. An integration with TD Ameritrade is being tested now and should be released soon. The program is planning a year-end 2012 release for its cloud-based application, and currently has a mobile version of its program, which works on iPhones and Blackberrys.



Integrated Office (Schwab’s turnkey solution)

Pricing: Starts at $10,000 a year for two advisors and the first 125 accounts with Schwab.

Newest upgrades, adds: Embedded workflows, document management, enhanced custody integration.

Contact:; 1-800-528-9595


PortfolioCenter (Schwab’s standalone software)

Pricing: First year is $8,000 for Schwab clients, $10,000 for other; $2,000 for subsequent years (support and maintenance). There is also an Emerging Practice version for smaller firms that is $3,000-$3,500 first-year cost.

Newest upgrades, adds: Securities data manager, client presentations, billing statements

Contact:; 800-528-9595


Profiles Professional v10.0

Pricing: Individual licenses are $1,045. Presentation Module LTO is priced at $95 with the New Retirement Consumer Facing Tool at $395 for individual advisors. Discounts are available based on volume, long-term commitment, and affiliation with a particular company. A discount also applies to a license for your assistant.

Newest upgrades, adds: An upgrade included Presentation Module, Redtail CRM integration, Case Review and Basic Workflow in November 2010.

Contact: EISI representative at [email protected]



Pricing: Provided upon request.

Newest upgrades, adds: Lead Management to track lead generation, lead aging, and conversion statistics; a MyRetirement financial planning module that illustrates the probability of funding retirement at various withdrawal rates; tablet-based financial planning report access; and a Social Security optimizer to help clients determine the best time to start receiving Social Security benefits. Additional integration points with custodians and CRM providers are up and coming.

Contact: Joe Salisbury, senior account executive, (801) 955-3169, [email protected]



Pricing: Individual list price is $1,295 per year. Affiliation discounts are $995 per year, which includes all upgrades and phone/e-mail support. Additional quantity discounts available.

Newest upgrades, adds:  In July, released MGP:G3 (the third generation of MGP Financial Planning SMARTware), with eight new features (Zoomer, Loss Tolerance, “What are you afraid of?” Social Security Maximization, Probability Matrix, Special Assets, Results Control Center, and My Way) and many major enhancements (e.g., SmartAlex, Play Zone II, Presentation II, SuperSolve II, My Snapshot II, and Online Data Gathering).

Contact: For individual sales, 800-841-5312, [email protected] For enterprise sales, Chad Blythe, vice president of sales, 804-744-5900, ext. 141, [email protected]

TAGS: Technology
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