The former wealth head of First Republic Bank, one of the casualties of last year’s regional banking crisis, has entered into a partnership with Boston-based private equity firm Summit Partners as he seeks to launch a new RIA.
In a statement, Summit announced Bob Thornton, who was president at First Republic Private Wealth Management, as the latest member of its executive-in-residence program.
During his time at First Republic, Thornton oversaw the recruitment of over 150 high-caliber financial advisors and the development of various high-value programs, which included integrated planning resources and a white-glove insurance product. That helped drive the bank’s wealth business from roughly $10 billion in assets to over $250 billion.
The first cracks in First Republic’s wealth franchise emerged last March, when an advisor with a reported book of $1.5 billion left to join Morgan Stanley. By May, it was all over for First Republic as JPMorgan announced it would acquire the failed San Francisco-based lender.
In his new role at Summit, Thornton will be collaborating with the PE firm’s growth products and services team as they seek new investment opportunities, focused specifically on “building a comprehensive wealth management platform in collaboration with leading wirehouse teams serving the high-net-worth customer.”
During a recent podcast interview, Thornton said the partnership is focused on building an independent, professionally led enterprise with a unique offering for advisors.
“[Summit’s] strength and experience in the financial services arena will provide attractive consideration to join the firm, but also equity ownership and the ability to realize that equity,” he said.
The new wealth enterprise, Thornton said, would be focused on recruiting teams that have succeeded on the strength of their ability to care about clients, either by acquiring more assets from those clients or earning referrals from them.
“We also want people who are very much going to think about themselves as owners, and that involves a balance between what they may specifically want to do as a team versus what's going to be successful for the overall firm and the growth of the enterprise,” he said.
Thornton acknowledged that elite advisor teams will be spoiled for choice as RIA firms fight to add great people to their networks.
But at the same time, he argued that many top-performing advisors aren’t interested in running their own firms, and there are only so many RIAs who have sufficient depth of management with people to effectively run their firms.
“There are many great leaders of firms who are producers themselves, but I think that the ability to find a firm that is very holistic in how advisors want to manage money, know how to manage a firm of much greater size, to be able to drive growth, protect the reputation of the firm … I don't see that many opportunities out there, and I think this is why we want to capitalize on what we're looking to build now,” he said.
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