After a year of slow recruiting and the recent
departure of one of its founders, Cantor Fitzgerald Wealth Partners, the budding wealth arm of storied trading firm Cantor Fitzgerald & Co., is recalibrating and betting on a stronger second act.
Following some soul-searching, Cantor Fitzgerald Wealth plans to bolster its senior leadership, refocus its recruiting efforts and upgrade its trading platform as it continues to aim for 300 advisers in the next two to five years, according to Shawn Matthews, who is CEO of the parent company and oversees the wealth management group.
“We are 100% committed to this business,” he said in an interview with
InvestmentNews. “Wealth management is a great product for us because it's an add-on to what we already do.”
Mr. Matthews had been co-CEO of the wealth division along with Stanley Gregor, who suddenly left the firm earlier this month after joining Cantor to build the wealth unit in 2013.
“I'm spending more time there, and I'm committed to building it out,” he said. “I'm taking it as a personal challenge.”
Cantor spokeswoman Sheryl Lee declined to comment on Mr. Gregor's departure.
As his first challenge, Mr. Matthews, who is running the day-to-day operations of the wealth group in addition to the work he does overseeing the trading business at the parent company, is still considering how to fill some of the responsibilities that had been under Mr. Gregor.
“We're looking right now at that the management structure,” he said. “And do I see me either promoting someone internally or going out and getting someone else to come in and run the division? Absolutely.”
REFOCUS RECRUITING
In addition, the firm plans to refocus its recruiting efforts. The firm said Thursday that it had brought in its seventh team, which had around $1 billion in assets, from Morgan Stanley Wealth Management's credit union group in Lansing, Mich.
Prior to that, the firm's last announced move was last July when it recruited a registered investment adviser with $120 million in assets in Yardley, Pa.
“I always want to be bigger, faster,” Mr. Matthews said when asked whether he was satisfied with that pace.
He acknowledged that the firm had gotten off track in how it was targeting advisers and said the firm needed to be clearer about who it was looking for.
“We were casting too wide of a net,” he said, “as opposed to trying to do all things and be all things to all people, we are going to be highly focused.”
He said that the firm has identified about 600 registered investment advisers whom it plans on homing in on. The goal, which he had set for himself last year, is to grow to 300 advisers in the next several years by focusing mostly on RIAs or wirehouse advisers who earn 90% or more of their revenue from fees rather than commissions.
EQUITY STAKE
The firm offers advisers an equity stake in Cantor Fitzgerald Wealth Partners in addition to other transition incentives, according to Mr. Matthews.
“We're offering a partnership mentality with significant access to the intellectual capability within the organization,” he said. “That allows us to help them make better decisions.”
As evidence that the firm remained focused on that growth, he said it was spending money on upgrading its proprietary trading platform. The firm custodies with multiple firms, but its advisers use its own desktop software to manage accounts.
Mark Elzweig, a third party recruiter at an eponymous firm, said Cantor's name on Wall Street has carried the firm far, but that it will still have to prove itself.
“They do have a good name, and I'm sure they'll be able to leverage it,” he said. “But there are a lot of places that offer a combination of upfront money and equity that are competing for million-dollar-plus producers who are heavily fee based.”
