HighTower Dismisses Senior Recruiting, Marketing Executives
Two weeks after recapitalizing through sale of a majority stake to a private equity firm, HighTower Advisors on Thursday dismissed several senior executives in a sign that it is changing its strategy from recruiting individual advisors and teams to larger-scale acquisitions.
Kimberly Papedis, a managing director who was promoted last April to national sales and “platform strategy,” confirmed in an e-mail that she has left the Chicago-based firm. Papedis, a former regional head of recruiting at Wells Fargo Advisors’ independent channel, joined HIghTower in 2014 to head West Coast recruiting.
Susan Krakower, who hired in July as “chief brand strategist” with a mandate to raise HighTower’s profile with consumers, has also left the firm, according to three people familiar with knowledge of the change. Krakower, who helped create the CNBC program “Mad Money with Jim Cramer,” could not be reached for comment.
The changes cap a year of other senior management departures at the firm that was founded in 2008 by Elliot Weissbluth. He and his original backers, including former Charles Schwab CEO David Pottruck, had hoped to build a wealth management powerhouse that would allow them and advisors who received equity in the firm to cash out through a public offering. Weissbluth began tamping such expectations in 2016.
After first trying to recruit big-book teams from large broker-dealers as working partners, Weissbluth shifted to a small-ball strategy of providing platforms to smaller producers and independent planners. As that shift occurred, several of HighTower’s biggest advisory teams severed their affiliations with the company.
Thomas H. Lee Partners, the private equity firm that now controls HighTower, wants to grow “inorganically” through acquisitions of large independent advisory firms in an attempt to build assets en route to an exit strategy, said a person familiar with its strategy. HighTower made a thrust in that direction last April when it purchased ten of the 12 “WealthTrust” advisory practices affiliated with RIA aggregator Affiliated Wealth Partners Holdings.
George Fischer, HighTower’s managing director of operations, said in an emailed statement that the firm’s strategy will still incorporate wirehouse teams as well as independent brokers who may want to affiliate under the firm’s “platform” channel.
“HighTower is continuing to invest in our investment research, technology, operations and practice management capabilities ahead of our next phase of rapid growth through both the acquisition of independent RIAs and wirehouse teams and also providing comprehensive services to independent financial advisory businesses who may join the HighTower platform,” Fischer said in the statement.
A spokesman at Thomas H. Lee said the firm could not immediately comment on the strategy or on Thursday’s personnel changes.
HighTower, which as of early this month had $31.3 billion in assets under management, according to a regulatory filing, made another personnel change on Thursday that further underscores its retrenchment from recruiting individual advisor teams.
Charles Cornett, who Papedis hired in August as one of six business development executives, has also left the firm, the sources said. Cornett, who was based in Richmond, Va., and, like Papedis, was previously a recruiter for Wells Fargo Advisors’ Financial Network of independent brokers, confirmed his departure in an email but declined further comment.
HighTower, whose president Michael LaMena left to join an RIA firm in Maryland last summer, currently has two business development executives, one source said.