Focus bolsters recruiting

Hiring to target big wirehouse teams looking to go independent

Apr 14, 2013 @ 8:31 am

By Andrew Osterland

Focus Financial Partners LLC is stepping up the competition for breakaway wirehouse brokers.

The largest aggregation of wealth management firms in the industry announced five new executive hires intended to improve its Focus Connections offering, which is aimed at recruiting wirehouse financial advisers to the independent channel.

Mark Hovanic, who worked as a complex and branch manager for Morgan Stanley Smith Barney LLC and UBS Wealth Management, will spearhead recruiting from the wirehouses, while managing director Richard Gill will continue to manage the overall Focus Connections program.

LUMINOUS CAPITAL

Matt Sonnen, the former chief operating officer of Luminous Capital LLC, will help breakaway brokers set up and improve their practices.

Luminous, started by former Merrill Lynch & Co. Inc. advisers David Hou and Mark Sear, may be the most successful example of breakaway brokers entering the independent registered investment adviser channel. Launched in 2008, Luminous' assets under management roughly tripled to $6 billion before it sold itself to First Republic Bank last year.

“With Mark and Matt on board, we're expanding the Focus Connections program,” said Focus Financial chief executive Rudy Adolf. “To make these experts available to our breakaway teams is a tremendous opportunity.”

Focus is targeting the largest, most sophisticated wirehouse teams looking to go independent, Mr. Adolf said.

Examples include a team led by former Merrill Lynch adviser John Beirne — managing about $2 billion — that joined Focus last year, and Sapient Private Wealth Management, a team of three Morgan Stanley Smith Barney advisers managing $600 million that joined the firm late in 2011.

The firm intends to maintain and possibly increase its pace of recruitment from the wirehouses, Mr. Adolf said.

The executive hires signal an increase in competition between RIA aggregating firms such as Focus, Dynasty Financial Partners LLC and HighTower Advisors LLC. All three firms are trying to lure wirehouse advisers looking to make the move off Wall Street.

Mr. Adolf, however, suggested that the Focus business model is very different from that of HighTower, which traditionally has purchased wirehouse advisers' practices and provided all the infrastructure needed to run their businesses, for a smaller cut of the advisers' revenue than the Wall Street firms would take.

“We either invest in entrepreneurs or we create them,” he said. “That's very different from going to another employee model like at HighTower.”

HighTower recently launched alternative business models offering advisers a more independent relationship with the firm.

Focus partner firms manage more than $60 billion in assets.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

What's the first thing advisers should do when they get home from a conference?

After attending a financial services conference, advisers can be overwhelmed by options, choices and tools. What's the first thing they should do when they get back to their office?

Latest news & opinion

Maryland jumps into fiduciary fray

Legislation would require brokers to act in best interests of clients.

8 apps advisers love for getting stuff done

Smartphone apps that advisers are using in 2018 to run their business more efficiently.

Galvin's DOL fiduciary rule enforcement triggers industry plea for court decision

Plaintiffs warned the Fifth Circuit that Massachusetts' move against Scottrade signaled that the partially implemented regulation can raise costs for financial firms.

Social Security underpaid 82% of dually entitled widows and widowers

Agency failed to tell survivors that they could switch to a higher retirement benefit later.

Is Fidelity competing with retirement plan advisers?

As the Boston-based mutual fund giant expands the products and services it brings to the retirement market, some financial advisers say the firm is encroaching on their turf.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print