Wealth management firms need scale to help advisors thrive

Like many rapidly consolidating industries, wealth management is witnessing a shift in how firms drive market share and compete, and the narrative in the independent space is also evolving with this shift.

The number of U.S. brokerage firms is shrinking every year, with 3,394 firms registered with the Financial Industry Regulatory Authority Inc. last year, a decrease of more than 1,400 firms from just 2017. The changing ecosystem of the clients we serve, combined with the ongoing democratization of wealth management, make scale and capital investment more important than ever before.

In the past, scaled wealth management platforms often downplayed their growth with platitudes like “making big seem small,” and providing a “boutique feel” where advisors get the “best of both worlds.” Admittedly, my firm also went to market with these types of storylines as we started to grow. Today, however, scale is viewed by advisors more similarly to other industries — as an asset and a strength.

Scale offers the solutions, capital and expertise entrepreneurial financial advisors need to serve their clients with distinction and build strong businesses, no matter what model they choose.

We’ve invested significant resources into rebuilding our service infrastructure and reimagining our technology platform because we know that delivering personalization at scale is essential to the advisors of today — and tomorrow.


Unfortunately, one area where the evolution toward scale has had a negative side effect is in advisor recruiting. There’s little debate that a wealth management firm’s ability to recruit is critically important to the advisors it serves, mainly because business growth increases the financial resources available to invest back into their needs.

However, the industry often resorts to fearmongering tactics and unfounded exaggerations about competitors’ solvency, leadership or business decisions to spur advisor movement and gain more assets.

Advisors deserve more from their firms. They deserve a partner fully focused on them and one evolving its business and brand to meet advisors’ changing needs. They deserve best-in-class solutions, resources and services that speak for themselves. They deserve transparency and commitment, not just when they transition, but throughout their journey with their firm. And they deserve a partner that cares not just about them and their assets, but about the clients they work with.

Firms need to take their cues from the work these amazing professionals do every day. Financial advisors gain and retain clients not through fear, but by creating trust through credibility, reliability, humility and optimism. Financial professionals are the trusted coach and friend their clients need to guide them toward their goals. They show up for their clients with positivity, new ideas and expertise that makes them stand out from the others. That’s what firms need to be for them.


Don’t get me wrong, competition is healthy. It fosters innovation and drives strategic focus. But the next generation of advisors want firms to show up differently. Firms owe it to them to concentrate more on what we are building and delivering than on their competitors’ real or exaggerated shortcomings.

Ultimately, short-term gains won through fear are not going to sustain the industry or help advisors thrive and grow. As scale players, firms’ actions feed perceptions of the industry and serve as a representation of advisors, employees and the overall integrity of the advice space. Scale has led to remarkable innovation and positive change, let’s not overshadow that progress with negativity.


As we were building our new brand, we conducted hours of interviews with financial professionals about what mattered most to them. In addition to scale, a variety of themes came up, with connection and community right at the top, especially among next-gen advisors. As an industry, we need to lean in on community and belonging, because when people feel as if they belong and are supported, they will thrive.

My four sons each attend large universities that have broad and diverse student bodies. Each of them has found vastly different and unique groups of friends and people they spend time with inside of these schools. They’ve found their communities because the universities use their scale to deliver resources and services that help students create connections.

Similarly, scale firms will help advisors thrive by using their resources to build and grow unique communities and by giving advisors access to more people who have similar goals, or who have built the type of business they want to build. Diversity of thought and experience leads to more meaningful connections. Firms’ goal for their advisors should be to help them find communities inside their walls and give them the resources to reach their full potential.

Greg Cornick is president of advice and wealth management at Osaic, one of the nation’s largest providers of wealth management services.

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