Orion sets sights on breakaway brokers

Fintech company is partnering with Josh Brown and MarketCounsel to help advisers go independent

Jun 6, 2018 @ 2:53 pm

By Ryan W. Neal

Orion Advisor Services is the latest technology company turning its attention toward breakaway brokers.

The portfolio management software provider announced a new program on Wednesday called Fast Track to support advisers leaving wirehouses and broker-dealers with technology implementation, strategies and education for launching their own practice.

On the technology side, Fast Track will help newly independent advisers get up-and-running with trading, reporting and billing as quick as possible. Kyle Hiatt, executive vice president of business development at Orion, said 90% of the advisers he's worked with are able to provide reports and bills to clients within two weeks after quarter end.

"That's a big deal," Mr. Hiatt said, adding that his team has helped 70 firms go independent in recent months. "Billing is a critical component because they don't want to lose revenue as they transition."

(More: Adviser's Consultant: Luring breakaway brokers to a hybrid RIA)

Technology is just one piece of the puzzle breakaway advisers have to worry about. There's often a lot of fear whether or not independence is the right move, so Orion is publishing an online resource center with advice and best practices.

Headlining the Breaking Away Resource Center is a video series hosted by Ritholtz Wealth Management CEO Josh Brown. Mr. Brown will interview advisers who successfully went independent about the decisions they made, the technology they put in place and how they solved the issues they were most nervous about.

There's a difference between running a practice and running a business, and most advisers are ill-equipped for the latter even if they have experience with the former, Mr. Brown said. Issues like picking technology vendors, deciding on a custodian, finding office real estate and budgeting for legal defense can prevent advisers from making the move.

"Those are the types of questions I'm asking of people who recently broke away and solved those problems and figured out the answers to those problems," Mr. Brown told InvestmentNews.

Orion's resource center will also feature content from MarketCounsel to help advisers with their legal questions. The firm already partners with Orion on the compliance reporting platform it launched in March, and MarketCounsel CEO Brian Hamburger said his team will also be available to provide personalized guidance for advisers that need additional help.

Part of that advice will undoubtedly involve issues with the broker protocol, but Mr. Hamburger said it's just one hazard advisers have to navigate. They also have to contend with privacy issues, data security, registrations and regulatory compliance.

"The biggest issue is helping to lay out the landscape of what exists: how to walk through this minefield in an artful manner," Mr. Hamburger said. "Dispelling the myths of the broker protocol is important, but.. plenty of folks who leave are outside of those protections."

"We're here to show them that by prudent planning and disciplined execution, anyone can make their move over to independence" he added.

In April, Orion's parent company, NorthStar Financial, purchased FTJ FundChoice. At the time, Orion CEO Eric Clarke said the inclusion of FTJ FundChoice's managed account solutions in Orion's investment model marketplace would help recruit breakaway brokers.

Mr. Hiatt said this is another piece of the puzzle for advisers going independent, but is separate from the Fast Track initiative.

But it shows that technology vendors are serious about the breakaway adviser market. Envestnet launched a similarly named Quick Start program in March to get help for breakaway advisers on its Tamarac portfolio management system.

"It's important to get in front of people before they make their next selection," Mr. Brown said, adding that it's more difficult to switch technologies after picking one. "Orion recognized that. It's a smart strategy to talk to breakaways before they make their move."


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