News stories emerge like points on a scatter chart; it’s the journalist’s job to connect them and draw the trend lines. For us, it started with a flurry of dots around RCS Capital a year and a half ago, as the company started gobbling up independent broker-dealers.

But as we started to pull back the lens, we saw there was a bit more going on.

There was my seatmate on the flight to the FSI OneVoice conference this year — an IBD chief executive who told me how happy he was to be one of Ladenburg Thalmann’s recent acquisitions. (Yes, we were both flying coach.) And AIG Advisor Group, too, told us it was shopping for smaller firms, even as it was finally digesting its last acquisition.
I started wondering: Why was all the action happening at the networks?

A few years ago, we started including with our FP50 coverage a Top 10 list that shows how the aggregated networks fit into the traditional rankings. That chart has changed in each of the years we’ve run it.

As it turns out, there isn’t a single reason; each of the networks has a slightly different story. But when we started asking around, we did find an underlying theme: the emergence of new ways in which firms are seeking to balance the benefits of scale with the personal relationships that keep independent advisors satisfied with and connected to their broker-dealers.

What that means for executives like Cetera’s Larry Roth and Advisor Group’s Erica McGinnis is spreading unified compliance and technology functions across the multiple independents, while encouraging all of their IBD executives to maintain close ties with their own advisor clients. These advisors “need the tools and resources that big firms can provide,” McGinnis told Senior Editor Charles Paikert in our cover story, “but they also want ... direct access to their own president. They like being one in 1,300, not one in 13,000.”

On the other hand, at a jumbo player like LPL Financial, that means the growth of the super-OSJs, where advisors can plug in to an intermediary firm whose executives have added clout at the home office. Which makes me wonder: If the super-OSJs keep growing, wouldn’t that ultimately make LPL a de facto network?

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