When financial advisors make the leap from the brokerage channel to the independent arena, or want to expand an existing independent practice, it helps if they have well-connected friends.
Diamond Consultants, a financial services search and consulting firm, recently added high-level practice management services to its offerings, so it can be that go-to resource for advisors. The services are wide-ranging, according to Mindy Diamond, president and chief executive officer of Chester, N.J.-based Diamond Consultants. They include assessing all of the benefits of a registered representative switching to the registered investment advisor business model, brokering sales of the practices and succession planning. But instead of just selling a registered rep on all of the virtues of being an RIA, Diamond said, she will delve into what the financial advisor wants for himself or herself, and the for the practice.
For instance, if a financial advisor with a hybrid business model derives 80% of his or her revenues from fee-based business, and mentions a lot of word about becoming an RIA, Diamond will discuss the benefits of going independent instead of keeping that business inside a broker-dealer.
“What are you looking to accomplish? What are your personal quality-of-life issues?” Diamond said in a phone conversation Monday morning. “Then we will begin to offer multiple solutions.”
One solution might be that one of the large asset custodians knows of smaller, independent firms that are looking to be purchased. And sometimes the solution is to do nothing, Diamond said.
In the last six to eight months, the firm has hired two associate recruiters and a communications director to focus on recruiting, freeing up Diamond to focus on the consulting services. Diamond said she hopes to hire two more full-time consultants in the next year.
Diamond Consultants has worked out agreements with the major asset custodians in the business, including Fidelity Investments and Pershing Advisor Solutions. Those firms, as well as any investment bank or other financial services firm that takes a direct role in a custom solution for one of Diamond Consultants’ clients, pay the fees for the consulting services.