What’s ahead in the RIA industry? Good, “healthy Darwinism,” says Fidelity’s Mike Durbin, president of Fidelity Institutional Wealth Services.

The way the industry looks today is quite different from five years ago and the next five years will bring plenty of change, too, Durbin said at a Fidelity roundtable in New York City on Friday featuring leaders in the independent space and clients of Fidelity’s custody and clearing businesses.

Large companies will get larger and smaller firms will be acquired, but consolidation and growth of large RIAs is not necessarily a bad thing. “It’s good, healthy Darwinism for the industry,” Durbin said.

While advisors in smaller towns in Middle America can maintain a successful practice with $40 million to $50 million in assets under management, that won’t work everywhere. As the industry “scales up,” smaller firms will be acquired or merge with larger RIAs, and the large RIAs will continue to get larger, Durbin said.

“But what happens to the $100 million to $500 million firms? That’s where the real change will be,” he said.

Large wirehouses will remain in place, but the movement toward independence will continue, panelists said.

“How many [advisors] broke away is not the key metric to measure this trend, but the new business models being created to serve them is,” Durbin said.

A number of firms are positioned to capture breakaway brokers. Both Securities America and National Financial Partners have a corporate and individual RIA model for advisors to choose from. HighTower Advisors also offers a range of independence options with its partnership, network or alliance model. Dynasty provides a one-stop platform for large advisories and United Capital offers employee advisors a single national brand and planning process.

While some advisors experience discontent and a loss of faith in the wirehouses, the reason for brokers leaving usually starts with advisors that want to do the right thing for their clients, panelists said.

“How am I going to be able to evolve to serve my clients? That started the discovery process for me,” said Alan Harter, founder of Pactolous Private Wealth Management.

“Advisors come to United Capital not because they want a paycheck, but because they want to change their value proposition to clients,” said Jason Del Col, senior vice president, advisory services for United Capital.

Wirehouse advisors who choose to leave have to decide whether to start their own RIA or to join an existing firm. “The regulatory environment is an important part of the decision and many find that the corporate RIA model makes sense,” said Jim Nagengast, chief executive officer of Securities America.

“Many decide they need a strong business partner, not just a shell or RIA overlay,” said James Poer, president, Advisors Services Group and senior vice president of National Financial Partners.

No matter where they end up, it can take time figure out where they want to go. “Many have been planning this type of move for several years,” said Mike Papedis, executive vice president, HighTower Experience Group. “Advisors leaving the wirehouses are not running from something, they're running toward the future.”