Aggregators in the registered investment advisory industry are companies that purchase and manage small businesses with the aim of generating profits. For instance, advisors who are not yet prepared to establish their own independent firm but wish to sever ties with their broker-dealer may consider partnering with an RIA aggregator. While there are several options available, some RIA aggregators distinguish themselves from the competition. If you are looking to expand your business, SmartAdvisor can assist you in connecting with prospective clients.
Understanding the RIA Aggregator Model
RIAs aggregators are firms that either acquire established practices directly or offer investment advisors who prefer not to run their own independent businesses the opportunity to utilize the necessary infrastructure and technical resources in serving their clients. Those advisors who opt for the latter can operate their business under the aggregator’s brand, saving them the time, money, and effort required to establish a new firm.
Advisors can benefit from aggregators’ access to a wide range of resources and tools, enabling them to enhance their client services. These resources encompass areas such as business, compliance, social media marketing, and software solutions. By utilizing these tools through the aggregator, advisors can enjoy a more cost-effective access to them.
Aggregators offer advisors the advantage of accessing a diverse range of resources and tools that enhance their ability to effectively serve clients. These resources include aspects like business operations, compliance, social media marketing, and software solutions. By consolidating all these tools, aggregators make it more cost-effective for advisors to utilize them.
Advisors have the flexibility to select from various business models depending on the structure of the RIA aggregator. They can either become a shareholder of the parent aggregator firm or join the network of advisors. These options can be appealing for advisors who are in a transitional phase of their career and not yet prepared to establish their own independent firm.
Best RIA Aggregators of 2023
In the RIA aggregator industry, numerous players exist, yet only a few have gained a commendable reputation. These companies serve as excellent choices for advisors seeking to establish an aggregator relationship.
Dynasty Financial Partners
Dynasty Financial Partners offers a wealth tech platform catering to established RIAs as well as advisors seeking independence. Their services encompass solutions in four important domains:
Creating an RIA
By becoming a part of the Dynasty Network advisory firm, you can join an RIA.
If advisors are interested in joining the Dynasty Network, they can benefit from an established platform that enables them to expand and flourish in their work, providing better service to their clients. Dynasty encourages advisors to arrange a discovery call to gain insights into the platform’s strategy and how it facilitates connections with established RIAs.
Focus on financial partners
Focus Financial Partners strategically invests in and collaborates with RIAs, offering support in various crucial domains such as capital raising, business planning, and succession planning. Advisors who join forces with Focus Financial Partners may seek opportunities to expand their current business or detach themselves from a larger organization.
FOCUS offers assistance in various areas, including:
Compliance with laws and regulations
Operations and technology
Focus also works with advisors who may be ready to retire and leave their companies but need help creating a workable succession plan. Interested advisors can schedule a call to discuss how Focus Financial Partners can help them reach their goals.
Commonwealth presents a variety of options for advisors seeking to expand their businesses or transfer them to the next generation. You can choose from four affiliation models.
- IAR (Corporate RIA) only:Independent advisory representatives of the Commonwealth are able to exclusively engage in fee-based business using this model.
- Hybrid RIA:Advisors who opt for this model have the opportunity to continue earning commissions through the Commonwealth’s broker-dealer arrangement, while simultaneously running their own advisory business via an RIA.
- RIAs (Independent Registered Investment Advisors) only:Commonwealth provides advisors with the opportunity to simulate the experience of operating their own RIA, eliminating the burdens and expenses involved in maintaining infrastructure.
Advisors possess the flexibility to switch to an alternative affiliate model whenever their business requirements alter. Those consultants who are intrigued can either complete a contact form on the Commonwealth website or get in touch with the development team via phone to explore various models.
LPL offers personalized support and cutting-edge technology to financial advisors, giving them the freedom to operate on their own terms. With multiple business models to choose from, advisors can select the best solution that aligns with their career aspirations, objectives, and requirements.
There are several suggested options, which include:
- add to an existing practice
- act as an independent consultant
- becoming an employee consultant
LPL Financial offers a wide range of solutions that cater to various advisory scenarios, showcasing their versatility. Advisors have the option to either submit their profile online or find a local LPL Financial representative for scheduling a discovery meeting.
Hightower focuses on growth and supports advisors in a number of key areas, including marketing, human resources, business consulting and regulatory compliance. Advisors can sell their business to Hightower, choose a partnership model or become part of the Hightower network.
Partners can benefit from a comprehensive range of support services that aim to simplify and save time for their advisory business. One instance is the provision of assistance by the Hightower team in creating social media marketing materials.
Determining whether Hightower is the ideal RIA aggregator for your business largely relies on the goals you wish to achieve. Advisors are recommended to schedule a call to gain a better understanding of the workings of the partnership with Hightower.
Advisors who are not inclined to manage their firms independently can find advantages in partnering with an RIA aggregator. When evaluating different RIA aggregators, it is beneficial to assess their partnership model, available features and tools for advisors, and the potential impact on business growth.
Tips for Growing Your Consulting Business
As an advisor, prospecting can consume a considerable amount of your daily routine. However, there are methods to save time while remaining connected with clients. Utilizing an online lead generation tool such as SmartAdvisor simplifies the process of customers discovering your services online, freeing up valuable time for you to dedicate towards other aspects of expanding your business.
If you desire greater control over your career as an advisor, launching an RIA can be a worthwhile endeavor, despite the potential time and cost involved. By familiarizing yourself with the software requirements for documentation, compliance, and funding, you can assess whether starting an RIA firm aligns with your goals.
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