With few newcomers and an aging advisor population, the wealth management industry’s independent channel has been focused on recruiting talent from captive firms.

But for the independent channel to continue to grow, the industry will have to help ease the transition for newcomers starting their own practices, according to a new report from Aite Group.

The report, which was written by research director Alois Pirker, looks at the biggest challenges for brokers wanting to break away: technology, compliance and administration. It is based on an Aite Group survey if 152 independent financial advisors that was conducted online in the fourth quarter.

“The hardest part is to leave a captive environment where a lot is taken care of for the advisor and than the advisor has to learn to stay compliant, which is difficult because the way to do so has been redefined over the last five years and more regulations are coming down the pike,” said Pirker in an interview Monday. “Ultimately everything they do they have to do the administrative side as well which they didn’t do before.”

On the bright side, there are new technology platforms such as Pershing’s NetX360 and Fidelity’s WealthCentral, which helps brokers start from ground zero. But breaking away remains a challenge. Pirker found that choosing product platforms, custodians and clearing firms is fairly simple, but implementing the required technology infrastructure, compliance requirements and administration is difficult. Forty percent of those surveyed said client retention was “extremely challenging,” “very challenging,” and “challenging” for them.

Yet 87% of independents recommend going independent, which means that as challenging as the process is the benefits outweigh the difficulties.

Those who have the most challenges and are least likely to recommend going independent, the report points out, are advisors that began as an independent in the RIA channel, have a six to 10 year tenure, or have less than $10 million in client assets. Those who has less than five years of tenure before going independent, joined an independent broker/dealer firm, or went independent during the economic crisis, were also reluctant to recommend breaking away.

Meanwhile, wirehouse brokers that breakaway are more successful than their peers who started out at independent firms. It is clear why: measured by book size, independent advisors that started out at a wirehouse are about five years ahead of those that began in an indy firm, the study said.

In addition, those from wirehouses are more likely to retain their clients when going independent, with 50% retaining three-quarters of their assets, while breakaways across all segments retain about 55% of client assets.

One of the more worrying trends said Pirker is that there has been a recent scarcity of new advisors starting out in the independent channel. The financial crisis has made it difficult to build a new advisory practice and the “low-hanging fruit” in the industry have been breakaways from the wirehouses since they come with a big book of clients and tend to retain their clients. But it is those firms which provide the ideal startup environment for newcomers to the industry, the report said, that will have the pick of the litter in terms of new advisor talent. “These firms will also have a leg up over firms which, too wrapped up in chasing breakaways, are leaving the next generation of advisors to the captive firms,” said Pirker.