Sirianni: “RIA Leadership Matters”
Those Advisors who remember culture at all, remember that it has something to do with leadership and a shared history, and they turn to the people running the remaining wires for a jolt of that old inspiration. They soon realize that their leaders have never picked up the phone to ask a stranger to buy a bond, or even worked in a branch office before. They care about cross selling and quarterly returns rather than clients. Few Advisors today have homey stories about having a cocktail with their wirehouse CEO, or being invited on his boat, or even of a birthday phone call. The new wirehouse leaders are busy, the old culture means nothing to them.
Today, in the Independent space, new leaders are emerging who are writing history as they go, inspiring Advisors to do more for themselves and their clients, bonding with their employees, and laying the groundwork for some great new stories.
Launching a successful RIA firm today takes old school leadership and current know how. Advisors should look long and hard at the folks leading the firms they wish to join, because they will make all the difference. Here are the top 5 most important traits Indy CEOs need and some of the Indy managers who exemplify them.
Indy CEOs need to be innovative at their cores, not merely folks who set up shop in an emerging area, buy up a bunch of roll up RIAs and see if it works out. Real innovators identify a need in the marketplace and craft a long term vision to fulfill it. You know innovation when you see it, and its effects are lasting. Elliot Weissbluth is an innovator. You can’t separate the rise of the Indy movement and Elliot. He was first through the window with a new model, got the press to acknowledge there was something happening here, and is not afraid to expand on his vision. He was not the original Indy, but he’s like Columbus, who may not have been the first to discover the New World, but its for sure that nobody had to discover it again after he did.
Good Indy CEOs need to be able to organize and lead a team the way a great baseball manager does. She’s usually faced with a bunch of successful individuals and entrepreneurs who profess to want to do things on their own. This is especially true of the Advisor who chooses Independence. She has to mold some super talented, super egotistic (sorry), and super independent folks into a cohesive firm. They need to be unleashed when its time for individual achievement (at the plate), and reined in when its time to be a team (in the field). That’s just the start. All new firms leverage vendors and platform providers in one way or another. Many may use Fidelity, but each may be charged a different price, all rely on outside vendors for their technology, but have vastly different results. If you can’t collaborate and work well corporately with vendors your firm will suffer. In my mind Shirl Penney at Dynasty has been able to blend corporate services from multiple, disparate models, and extremely hard to find upper echelon products from the touchiest of providers, into a smooth working platform like no one else. His years in the C-suite of Americas largest bank has given him the ability to fight for what his business needs, while maintaining some of the best alliances and networks in the business today.
Inspiration breeds culture and vice versa. Inspirational leaders lead from the front. They started their firms from scratch and have usually done every job at the firm they run. They have the magic gift of empathy. They honestly relate to every employee, and treat everyone with the platinum rule –“Treat others how they would like to be treated.” The significant difference with the golden rule is that you have to listen to someone to find out how they wish to be treated. Inspired leadership creates confidence at every level of the firm. Mike Maurer at Steward Partners is an inspirational leader. He puts his clients first, his Advisors second, his company third, and himself last. He knows that if he takes care of the first three, he will be fine. Is there a Wirehouse leader left who understands that?
4. Financial Stewards
Leverage and the shotgun marriages it creates between CEOs and the venture vultures is the bane of Indy leadership. Decisions start to look like wirehouse edicts when dictated by outside firms with a purely economic interest in the business. Rudy Adolf and Joe Duran are not only top managers, but they have managed their firms assets very wisely. Joe Duran had enough capital to recently bonus his top managers to keep them around, while other Indy firms are struggling to keep talent with low pay and high hopes. That type of corporate investment bodes well for the long term future of United Capital. Similarly, Rudy Adolf has never had to stop growing from a lack of resources. He has stuck to his knitting and insourced where its been most effective rather than outsourced, and has been able to retain top talent as a result. Growing an RIA can be expensive; you want the leader you love to be able to navigate the tricky financial waters in the new Indy world or her boat may sink.
Scratch the surface of any Indy CEO and you will find someone who left traditional Wall Street for greener pastures. Most of the time, you can get a story about what loyalty means. Many CEOs felt betrayed by the culture of greed that replaced the culture of caring that used to be Wall Street. Many were offended by the way wires treated their employees when the chips were down. Most thought they could do it better. You cant feel betrayed unless you were loyal in the first place. Every Indy CEO I know values loyalty. They all started their firms with employees who purposely took less money than they could make elsewhere because of their personal loyalty to the new CEO. A firm filled with people who put their money where their mouths are for a friend is always a good place to be.
Indy firms are living their creation myths as we speak. They are sharing their corporate “firsts” together: first billion, first branch on the west coast, first press release. They will narrate the stories of their founders successes and failures for the next generation of leaders, and hopefully keep in mind the mistakes of their grandfathers at the wires, so no other group dedicated to helping clients manage their assets has to go through the same loss of soul.
Tony Sirianni is one of the most respected voices in the Independent space, and a tireless advocate for Advisors and RIAs. Through his firm Sirianni Strategy Group, he works with elite Advisors, RIAs and corporations in Public Relations and Strategy. Tony was a founding partner of Steward Partners, CEO and founder of Washington Wealth Management, and an Executive Director and Complex Manager for Morgan Stanley, Smith Barney, and Legg Mason. He has a Masters in creative writing and a JP from New York Law School.