As the ranks of independent advisory firms have swelled, so has the challenge of coming up with a unique company name.
If you want your branding to convey a “heritage” for clients, or want to crow about offering “sage” advice for a retirement “horizon,” forget about it. Those names are already taken, with anywhere from 50 to 60 firms using derivations of those words in their names.
Indeed, a number of lofty-sounding monikers litter the advisory landscape.
“I can't tell you how many are named "pinnacle' or "summit,'” said Andrew Gluck chief executive of Advisor Products Inc., a marketing consultant.
According to the Securities and Exchange Commission's registration database, 78 registered investment advisory firms have “pinnacle” in their name, and more than 100 start with “summit.” The database doesn't return data when a search turns up more than 100 names.
Observers warn that similar names can hurt marketing efforts and even cause legal problems. But that hasn't stopped a proliferation of copycat names.
For example, firm monikers that promise “solutions” for clients total more than 100.
Names that denote honest, independent and personal advice also tend to be overused. Fifty firms begin their names with “integrity,” 52 with “independent” and 64 with “personal.”
Water must have a soothing effect on investors because 56 firms have named themselves “river”-something, and 23 start with “lake.”
Clients in need of investment direction can choose among 65 firms beginning with “beacon,” 37 with “lighthouse” and 11 with “pathway.”
LEGAL CONFLICTS
The huge name overlaps can cause confusion and potentially create legal conflicts, said Douglas Heikkinen, president of Riley Weiss, a marketing consultant.
“When we rename or name a firm, we make sure it's free and clear” of trademark restrictions, he said. “I don't think [most financial advisers] bother looking.”
When he incorporated his firm as Pinnacle Asset Management Inc. in the 1990s, president Kenyon Lederer searched for existing names that were similar.
“We've actually had more confusion with local firms in other industries that are named pinnacle,” said Mr. Lederer, whose firm is based in Roseville, Calif.
At least five other Pinnacle Asset Management firms do business in the United States.
“There is no other financial firm in our area with the name, and there's no confusion in our niche market” of serving employees of AT&T, Mr. Lederer said.
Even with a half-dozen derivations of the “client first” name in use, Ken Lawson, founder of the start-up firm Client 1st Wealth Management Inc. hasn't seen much overlap in Iowa and Illinois, where he does business. “I did choose a little different spelling” by using “1st” instead of “first,” he said.
Name overlap in the broker-dealer world seems less rampant, but it can still be a problem.
When Securities Network LLC of Norcross, Ga., shuttered its doors in March due to fallout from high-risk private placements, some people wrongly thought that a similarly named firm, Securities Service Network Inc., was in trouble.
“We're really well-capitalized, and we don't do private placements, so it was frustrating to be confused with a firm that failed for just those reasons,” said Wade Wilkinson, chief executive of Securities Service Network.
Legal issues aside, using a common name makes it tough for an advisory firm to get noticed in search engines, Mr. Gluck said.
For example, eight advisory firms use “personal financial advisers” in their names, yet none come up via a Google search.
Many advisers, of course, use their own names in branding their firms.
Mr. Wilkinson advises doing just that in order to avoid any confusion.
“The one key differentiator is [an adviser's] own credibility,” he said.
QUIRK CAN WORK
But the counterargument is that using a personal name can be a problem when it comes time to sell a firm.
Branding experts say that quirky and other memorable names can work well, especially if they tell a story about what you do.
Suzanne Wolfson, founder of a firm called For Retired Only, said that she developed that name after dealing with younger, demanding clients during the dot-com bubble. By contrast, retirees “are not asking for 35% a year” returns, she said.
The one drawback with her current company is that some investors think they have to be retired before retaining her, Ms. Wolfson said.
Other advisers pick a name based on a personal passion.
For example, Jim Harvey, a pianist and president of Opus 111 Group LLC, named his firm after the Beethoven piano sonata of the same name. The work is a “visionary piece of music” similar to modern ragtime music, he said.
Mr. Harvey, of course, wants his high-end clientele to think of him as a visionary.
“And at some point I want to sell, so I didn't want Jim Harvey & Co. [and] I didn't want an "eagle' or "paragon'” type of name, he said.
The “opus” moniker, though used by 10 other advisory firms, still is more original than the 42 RIA firms that begin with “eagle” and the 26 that start with “paragon.”
Email Dan Jamieson at [email protected]
