Deciding on Indy or Wirehouse?

[quote=OhioAdvisor]

I am a current semi-indy rep today with an I insurance B/D who is looking to make a change.  I have narrowed down to Commonwealth and ML or SB. 

I know the difference between the two are huge and personally I think I value the Independence much more but I can't help but not think about the the huge forgivable loan money ML and SB have thrown in front of me.

I understand the indy culture side and running a business since that's pretty much what I am doing today.  What I don't understand is the culture difference at a wire-house. 

The managers at ML/Sb have told me over and over that there are no quota's, no one that's looking over my shoulder.  Both have said they only need to grow their branch's by around 10-15% and if I can just grow my business that much I would be fine.  Now, I do fairly well (above 300 GDC) in the growth side and my GDC would be fine but it's still scary proposition to be working for someone else.  I don't know what I don't know.

Anyone have advice for me as to the diff in cultures between Indy and Wirehouse and would a fat up front check make up for the loss of Independence?

[quote=OhioAdvisor]

I am a current semi-indy rep today with an I insurance B/D who is looking to make a change.  I have narrowed down to Commonwealth and ML or SB. 

I know the difference between the two are huge and personally I think I value the Independence much more but I can't help but not think about the the huge forgivable loan money ML and SB have thrown in front of me.

I understand the indy culture side and running a business since that's pretty much what I am doing today.  What I don't understand is the culture difference at a wire-house. 

The managers at ML/Sb have told me over and over that there are now quota's.  Both have said they only need to grow their branch's by around 10-15% and if I can just grow my business that much I would be fine.  Now, I do fairly well in the growth side and my GDC would be fine but it's still scary proposition to be working for someone else.  I don't know what I don't know.

Anyone have advice for me as to the diff in cultures between Indy and Wirehouse and would a fat up front check make up for the loss of Independence?

[/quote]

You're a big girl, now, and you shouldn't need to go to the internet to make such important decisions. How the hell would WE know how you would react to "loss of independence" and how much money it would take to neutralize that reaction?

[quote=OhioAdvisor]

Now, I do fairly well in the growth side and my
GDC would be fine but it’s still scary proposition to be working for
someone else.  I don’t know what I don’t know.

[quote=NASDY Newbie] [quote=OhioAdvisor]

Now, I do fairly well in the growth side and my GDC would be fine but it's still scary proposition to be working for someone else.  I don't know what I don't know.

[/quote]

How could it be "scary" going to work for one of the premier brokerage firms in the world?

The only reason to be independent is if you're a small hitter and need the accellerated payout offered by an independent firm.  You sacrifice by ending up working out of your car and/or a desk at Kinkos.  You hide behind "Voice Mail" systems that give the impression that you're a much larger organization and dream that someday you'll be able to afford a real office.

Look at the major hitters in the business.  They're going to be at the wirehouses.  If what was offered by an independent firm was truly worthwhile do you think that the stars at Merrill would not be opening their own shops and enjoying a 90% payout?
[/quote]

I'd rather be a major earner than a major hitter.

How could it be "scary" going to work for one of the premier brokerage firms in the world?

The only reason to be independent is if you're a small hitter and need the accellerated payout offered by an independent firm.  You sacrifice by ending up working out of your car and/or a desk at Kinkos.  You hide behind "Voice Mail" systems that give the impression that you're a much larger organization and dream that someday you'll be able to afford a real office.

Look at the major hitters in the business.  They're going to be at the wirehouses.  If what was offered by an independent firm was truly worthwhile do you think that the stars at Merrill would not be opening their own shops and enjoying a 90% payout?
[/quote]

Newbie you know so little about the indy side! The wire houses are Dinosaurs.  <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

So my question is this...

Do they have production minimums at ML or SB?  If I am producing around 300 GDC is that enough to keep me around?  Can I have the flexibility I ahve now with my job i.e. coming and going when I want, taking off whenever I want etc? 

[quote=Greenbacks]

Newbie you know so little about the indy side! The wire houses are Dinosaurs.  

Newby darling, take your own advice. Or perhaps I missed it. Who exactly are you citing here?:

How could it be "scary" going to work for one of the premier brokerage firms in the world?

The only reason to be independent is if you're a small hitter and need the accellerated payout offered by an independent firm.  You sacrifice by ending up working out of your car and/or a desk at Kinkos.  You hide behind "Voice Mail" systems that give the impression that you're a much larger organization and dream that someday you'll be able to afford a real office.

Look at the major hitters in the business.  They're going to be at the wirehouses.  If what was offered by an independent firm was truly worthwhile do you think that the stars at Merrill would not be opening their own shops and enjoying a 90% payout?

I’m asking for examples of why the wirehouses are dinosaures.  They can be anybody’s point of view.

[quote=OhioAdvisor]...would a fat up front check make up for the loss of Independence?[/quote]

No.  They don't pull this money out of the air...eventually, they'll get it back on the payout differential...and if you leave early, they'll get it back quicker.

[quote=Indyone]

[quote=OhioAdvisor]…would a fat up front check make up for the loss of Independence?[/quote]

No.  They don't pull this money out of the air...eventually, they'll get it back on the payout differential...and if you leave early, they'll get it back quicker.

This may be true when you’re comparing indy b/ds and wirehouses, but the other kind of “independence” – joining or forming an RIA shop – does offer some benefits in that you have more flexibility in terms of the kinds of products and services you offer and the way you charge for those services. You may also have less pressure on you from a large compliance bureaucracy…So leaving a wirehouse for an RIA can make a lot of sense for top producers who have an entrepreneurial bent, and want to do things their own way. That said, i think the wirehouses have caught on to this, and may have begun offering the really top top guys the flexibility they want …

[quote=wanda]



You may also have less pressure on you from a large compliance bureaucracy.



[/quote]



Do you believe that a compliance officer’s job is to make the sales force’s lives miserable, or to keep them out of trouble?

of course it’s to keep them out of trouble. I’m not blaming the compliance guys. But the end result, unfortunately, at the big firms, is inevitably reams and reams of paperwork. Compliance is not nearly as burdensome at an RIA.  

[quote=wanda]of course it’s to keep them out of trouble. I’m not
blaming the compliance guys. But the end result, unfortunately, at
the big firms, is inevitably reams and reams of paperwork. Compliance
is not nearly as burdensome at an RIA.  [/quote]



Reams and reams?  If compliance is not so “burdensome” it would
have to be because your broker/dealer is not as focused on keeping you
out of trouble.



It’s ridiculous to think that wirehouse compliance departments do
things that are not necessary.  If your B/D is cutting corners you
can bet it is not in an effort to do what is right for you.

[quote=OhioAdvisor]

So my question is this…

Do they have production minimums at ML or SB?  If I am producing around 300 GDC is that enough to keep me around?  Can I have the flexibility I ahve now with my job i.e. coming and going when I want, taking off whenever I want etc? 

My decision is made..

I am going to where I can control my enivornment, my staffing and my costs.  I think I was letting greed take over but I am convinced that after taxes on the up front money, fighting for staff resources, worrying about future layoffs that I am best served being a small business owner.

After all the majority of wealth in this country is from small biz owners.  Stock brokers enjoy rich cash flow but it's not the same as a small biz owner.

Greed is gone and common sense prevailed.

<300k at SB is where you will dinged.  It'll probably go up next yr also.  The big firms nowdays have bulls eyes on their backs so thus compliance is more of a problem.  Yes, it's to protect you but it is most importantly to protect them.  It's over done but it has to be that way right now given they get sued for everything imaginable.

Coming up, time clocks to punch and overtime pay for new hires.

Remember that big upfront check is taxable with an amortization schedule equal to your contract length. THey will take the taxes out of your account once a year.   If you can keep your business going with out dropping much in gross, it's a great thing even with the taxes.  Don't go nuts with the money.  You may need it to sustain your current lifestyle when "probably not if," your biz drops for awhile after the move. 

Your first year pay grid should be negotiated at the the highest payout regardless of your total gross.  After that, you're on your own.

[quote=NASD Newby] [quote=Indyone]

[quote=OhioAdvisor]...would a fat up front check make up for the loss of Independence?[/quote]

No.  They don't pull this money out of the air...eventually, they'll get it back on the payout differential...and if you leave early, they'll get it back quicker.

[/quote]

Why would anybody who was making a living leave a wirehouse?  I refuse to believe it is so they can start to pay the matching FICA, pay for their own yellow pads, pay for their own assistant, pay for their own health insurance, pay for their own computer, software and so forth, pay for their own office space, pay for their own furnishings, pay their own phone bill, pay their own postage, pay for their own advertising pieces, pay for their own..........I grow weary.

If being independent was attractive the wirehouse stars would have all gone independent.

If being independent was attractive the independent B/D management would not be worrying about how to recruit brokers who were worth having instead of simply bodies.

The only people who think Indy is better than a wirehouse are those who could not get hired by a wirehouse, or those who were hired by them but were about to be fired for lack of production.

It really is that simple, yet that complex.  But think logically--why in the world would a corner office "star" at Smith Barney in, say, Oklahoma City not form his own office and make more money?
[/quote]

Your fist paragraph answered much of the question about why many capable people choose to stay in a wirehouse environment.  Then you go and say something stupid like "The only people who think Indy is better than a wirehouse are those who could not get hired by a wirehouse, or those who were hired by them but were about to be fired for lack of production."  There are about a hundred million-dollar producers at my indy B/D.  It's highly unlikely that any of these folks couldn't cut it at a wirehouse.

You make absolute statements like this instead of saying something like "MANY people who think...".  That's what ruins your credibility and makes you look like a clueless fool.  I would grant you that some independents are independent because they couldn't cut it somewhere else, but it's far from all of us.

Far from cutting me loose, my former employer begged me to stay and discussed stock options and grid improvement if I did.  I chose to leave because I was simply over-managed and fed up with being lied to, and dealing with an ever-changing grid.

What you are saying is kind of like me saying that since an assistant is capable of ordering paperclips, all wirehouse middle managers are just unnecessary overhead and should be fired.

One other thing.  If you are going to be doing 300kin gross and that is where you will be, I would NOT go to ML or SB.  Your payout will be so low "around 33%" that it doesnt make sense.  You need to get it up to 350k - 400k for it to make sense. 

Also, things just move slower at a wire.  There's channels, procedures etc. that can get frustrating for someone used to quick responsive help.  I share an SA with one other FC but there are guys at around 300k gross sharing an SA here with THREE other FCs. If they'er busy those FCs may have to wait a day or two or longer for something that you are used to getting done in one hour. 

Wires resources go to where the gross producers are dont forget that. Average assets under mgnt in my region are around 80 million and yours probably wont be much different so don't expect to be high up on the totem pole.  

[quote=NASD Advocate] [quote=wanda]

You may also have less pressure on you from a large compliance bureaucracy.

[/quote]

Do you believe that a compliance officer's job is to make the sales force's lives miserable, or to keep them out of trouble?
[/quote]

Obviously their job it the latter, often the way they do it producers the former...

“…their job IS…”

This maybe a naive question, but why do the heavy hitters who you read about in trade magazines (minimum $1 million GDC) work at wirehouses?  Do they have golden handcuffs?  Treated like royalty?  Free afternoon BJs?

[quote=Mike Damone]This maybe a naive question, but why do the heavy
hitters who you read about in trade magazines (minimum $1 million GDC)
work at wirehouses?  Do they have golden handcuffs?  Treated
like royalty?  Free afternoon BJs?[/quote]



Some have golden handcuffs, but many of them are senior enough that
they could retire–claim the gold.  Stay retired for a year or so
and come back as an "indy.“



The reality is that they cannot see the economic benefit.



The typical indy broker underestimates a lot of expenses in order to
justify leaving the safety of a wirehouse.   Generally they
settle for a cheap office (which they pretend their clients don’t
notice or care about), they do not mail as aggressively because they
have to pay their postage and buy whatever they’re going to mail, they
"watch” their long distance phone calls, they have limited or no
support (many of them have nobody helping them, perhaps a wife or
daughter a few hours a week), they have to get their own technology
(often a TV tuned to CNBC is the focal point), they convince themselves
that their clients do not notice that they wear jeans and golf shirts
because their budget won’t allow business suits, they have to pay their
own health insurance so they choose monster deductibles and opt to not
get things like dental coverage.



There is a reason why wirehouses keep so much of the gross–and that
reason is because they have to cover a lot of overhead.  It is not
all evil compliance officers and vice presidents who manage the entire
operation–it’s branches and complicated computer networks, it’s
clearing fees, it’s hundreds of Fed Ex shipments per day, it’s a very
attractive health care, it’s very attractive 401(k) matches, and on and
on.



Bob Broker, the $1 million hitter in Austin knows that he’s giving up a
lot of his gross–but when he looks at all the things that they don’t
have to pay for they simply cannot justify making the move.



Most of them will say "I’ve got a corner office in a prestige
building.  There is a receptionist to greet you if you come to see
me.  I will send one of my three sales assisstants out to show you
back to my office.



When you come in you will be struck by the view.  I’ll offer you a
seat on a $1,000 sofa and another assistant will ask if she can get you
something to drink.



They’ll also tell you that being a Vice President of Merrill Lynch
carries more prestige than being the “Owner” of "Jones Financial
Planning and Nail Salon, Ltd."



The only reason to not join a wirehouse is because you can’t get an
offer from one, and the only reason to leave one is because they’re
going to fire you at the end of the year anyway.



Yes the hurdles are high, and yes there are a lot who fail–but it’s
the major leagues where the going is always tough and the competition
is always keen.

[quote=Soon 2 B Gone][quote=Mike Damone]This maybe a naive question, but why do the heavy hitters who you read about in trade magazines (minimum $1 million GDC) work at wirehouses?  Do they have golden handcuffs?  Treated like royalty?  Free afternoon BJs?[/quote]

Some have golden handcuffs, but many of them are senior enough that they could retire--claim the gold.  Stay retired for a year or so and come back as an "indy."

The reality is that they cannot see the economic benefit.  Bull.  Many can and some actually follow through and leave.  Economic benefit is not the primary reason most leave anyway...it's just kind of an icing-on-the-cake thing.

The typical indy broker underestimates a lot of expenses in order to justify leaving the safety of a wirehouse.   Generally they settle for a cheap office (which they pretend their clients don't notice or care about), they do not mail as aggressively because they have to pay their postage and buy whatever they're going to mail, they "watch" their long distance phone calls, they have limited or no support (many of them have nobody helping them, perhaps a wife or daughter a few hours a week), they have to get their own technology (often a TV tuned to CNBC is the focal point), they convince themselves that their clients do not notice that they wear jeans and golf shirts because their budget won't allow business suits, they have to pay their own health insurance so they choose monster deductibles and opt to not get things like dental coverage.  This is so far from my reality that there's no sense in responding.

There is a reason why wirehouses keep so much of the gross--and that reason is because they have to cover a lot of overhead.  It is not all evil compliance officers and vice presidents who manage the entire operation--it's branches and complicated computer networks, it's clearing fees, it's hundreds of Fed Ex shipments per day, it's a very attractive health care, it's very attractive 401(k) matches, and on and on.  The reality is that too much of the overhead goes to pay the bloated salary of the vice president of paperclips...who spends the excess time after the paperclips are ordered for the week to dispense unwanted and unsolicited advice to any office employee who makes the mistake of slowing down when they see his wake.

Bob Broker, the $1 million hitter in Austin knows that he's giving up a lot of his gross--but when he looks at all the things that they don't have to pay for they simply cannot justify making the move.  Sure they can...were you always this poor at math?

Most of them will say "I've got a corner office in a prestige building.  There is a receptionist to greet you if you come to see me.  I will send one of my three sales assisstants out to show you back to my office.

When you come in you will be struck by the view.  I'll offer you a seat on a $1,000 sofa and another assistant will ask if she can get you something to drink.  A Pepsi on a thousand dollar sofa sounds pretty cheesy to me...how long has it been since you bought any furniture?  Oh that's right...you never got promoted beyond paperclips.

They'll also tell you that being a Vice President of Merrill Lynch carries more prestige than being the "Owner" of "Jones Financial Planning and Nail Salon, Ltd."  That depends upon who you ask.  Did you tell anyone that it was vice president of paperclips?

The only reason to not join a wirehouse is because you can't get an offer from one, and the only reason to leave one is because they're going to fire you at the end of the year anyway.  Right...you just stay there in fantasyland sipping your Pepsi on your thousand dollar couch and convince yourself that people like Ron Carson are just in your imagination.

Yes the hurdles are high, and yes there are a lot who fail--but it's the major leagues where the going is always tough and the competition is always keen.  You know nothing of the major leages...you haven't produced for thirty years.
[/quote]

By the way...nice name...but it can't come soon enough for me.

Indy, did you leave a wirehouse–or are you one of those who was never offered a slot in the major leagues?

Ron Carson is an example of the exception to the rule.  For every guy who left a wirehouse there are hundreds who stayed.



None of them are fools.



Why do you think the biggest concern in the world of independent B/Ds
is how to attract quality producers instead of simply gathering bodies?

[quote=Soon 2 B Gone]Indy, did you leave a wirehouse--or are you one of those who was never offered a slot in the major leagues?
[/quote]

I know you'll find this hard to believe, but I've never lived or worked any closer than 50-60 miles of a wirehouse office, and thus, I've never approached a wirehouse office about a position.  Had I wanted to work in a wirehouse office, I'm confident that I could have gotten an offer if I'd sought one.  Part of being successful is having a feel for the optimum environment for personal success and I've never felt like the wirehouse was best suited for me personally, thus I've never pursued it.  That's hardly equivalent to being turned down as you like to insinuate.

[quote=Soon 2 B Gone]Ron Carson is an example of the exception to the rule.  For every guy who left a wirehouse there are hundreds who stayed.

None of them are fools.[/quote]

I'm not calling those who stay fools, but neither should you label those who leave as washouts.  I also don't believe your "For every guy who left a wirehouse there are hundreds who stayed." comment.  Prove it.  I know one thing for certain...independents sure aren't joining wirehouses, even though plenty of them could.

I had a client in yesterday 27 million if I would have a three piece suite on and asked her to sit on a $1,000 sofa she would not be my client. Clients see all that waste! And they know who is paying for it!

I do not wear jeans but if clients had to choose between a suite and jeans they would perfer I would dress in jeans. No question about it!

Please note that I am in a small CO ski town and not NY.

If I had to choose between a suite and jeans I’d choose jeans too–when you put a suite on you look so big and boxy.



I used to own a ski rental shop in Breckenridge.  I know about ski towns.

One other  note.

I would take my view of the snow capped rockies & CO blue sky, over any NY smog filled view of a sky scrapper any day!

Was Sanford and Son a sky scrapper?



As for smog.  New York City is not a smoggy place.  It’s the city so nice they named it twice.

[quote=Indyone]I know one thing for certain…independents sure aren’t joining wirehouses, even though plenty of them could.[/quote]

Sorry, IndyOne.  I’ve talked to a lot of independents who want to return to wirehouses.

Some are escaping from bad partnerships.  Some have seen their production plummet for whatever reason.  Most underestimated the overhead costs and the hassles of managing a heavily regulated business.  I also hear a lot of complaints about clearing firms.

Significantly, almost all of them commented on the value of a wirehouse brand.

Several of these candidates have placed.  But many of them have broken their practices beyond repair.

I’m not claiming that everybody is unhappy.  I know another recruiter who helps people go indy.  He has many happy clients.  So do I.

Certain people on this forum get mad at me when I suggest that the world is not a series of binary value judgements.  That won’t change reality.  Some people are happier owning a small firm.  Others are happier working with a major brand.


Like Strauss said:  “Chacun à son gout.”   (To each his own.)

[quote=Soon 2 B Gone]If I had to choose between a suite and jeans I'd choose jeans too--when you put a suite on you look so big and boxy.


[/quote]

Now, that's funny.   Suite    Suit 

[quote=JCadieux][quote=Indyone]I know one thing for certain...independents sure aren't joining wirehouses, even though plenty of them could.[/quote]

Sorry, IndyOne.  I've talked to a lot of independents who want to return to wirehouses.

Some are escaping from bad partnerships.  Some have seen their production plummet for whatever reason.  Most underestimated the overhead costs and the hassles of managing a heavily regulated business.  I also hear a lot of complaints about clearing firms.

Significantly, almost all of them commented on the value of a wirehouse brand.

Several of these candidates have placed.  But many of them have broken their practices beyond repair.

I'm not claiming that everybody is unhappy.  I know another recruiter who helps people go indy.  He has many happy clients.  So do I.

Certain people on this forum get mad at me when I suggest that the world is not a series of binary value judgements.  That won't change reality.  Some people are happier owning a small firm.  Others are happier working with a major brand.


Like Strauss said:  "Chacun à son gout."   (To each his own.)
[/quote]

Jeff, I'm not disagreeing with you...I should have qualified my statement by saying "for the most part" or something similar.  What I took issue with was "For every guy who left a wirehouse there are hundreds who stayed."  The insinuation is that virtually no one leaves a wirehouse to go independent, and that's just baloney.  I would further say that if the statistics are known (and someone probably has them), I would bet that there are far more people going from a wirehouse to an independent practice than vice-versa...just a hunch I have.

You've outlined several good reasons to go the wirehouse route, and I'm not here to tell you that you're wrong...you're not.  Neither am I.  Some people are better suited to the wirehouse model and some like me, are clearly better suited to the independent model.  What I'm here to combat is the statement that only washouts and never-weres go the indy route, and virtually no one at a wire would consider going independent.  That's just inflammatory baloney and Put Easy knows it.  Chacun à son gout back at you...

No, what I’ve said is that virtually nobody who is a star at a wirehouse will bother to leave.



There are lots of mediocre brokers who leave rather than get shoved, or who get shoved and go the independent route.



Like Jeff I too have seen a lot of people returning to wirehouses after
flirting with the idea of being independent and realizing that it’s a
mirage.



You have said you have never lived or worked within sixty miles of a wirehouse.  Does that mean you do not have a formal education?

[quote=JCadieux][quote=Indyone]I know one thing for certain…independents sure aren’t joining wirehouses, even though plenty of them could.[/quote]

Sorry, IndyOne.  I’ve talked to a lot of independents who want to return to wirehouses.

Some are escaping from bad partnerships.  Some have seen their production plummet for whatever reason.  Most underestimated the overhead costs and the hassles of managing a heavily regulated business.  I also hear a lot of complaints about clearing firms.

Significantly, almost all of them commented on the value of a wirehouse brand.

Several of these candidates have placed.  But many of them have broken their practices beyond repair.

I’m not claiming that everybody is unhappy.  I know another recruiter who helps people go indy.  He has many happy clients.  So do I.

Certain people on this forum get mad at me when I suggest that the world is not a series of binary value judgements.  That won’t change reality.  Some people are happier owning a small firm.  Others are happier working with a major brand.


Like Strauss said:  “Chacun à son gout.”   (To each his own.)


[/quote]

No offense Jeff but wirehouses have the capital to pay recruiters and make the best upfront deals. So you might have a little more self-interest involved than objectivity. Even with this they are slowly losing the head count wars and for good reason. If you are a young person you build equity and if you are an older person you don’t need foolish short-term clowns like NASD “Oldie” getting paid to tell you platitudes (that are false/dated for the most part) from your revenue.

The fact that the major firm pay their people on “gross credits” which could be anything the firm decides is the first clue as to why you should go independent if you have no special reason to be at a better capitialized sweatshop. This is essentially a fraud activity by the way, but since it done to producers and not the public directly the NASD has nothing to say about it. As if this doesn’t trickle down to the customers by creating the sleazy cut-throat wire-house dominated industry?

Sure, if you are being offered accounts or access or other special capital resources (wirehouses are filled with cronyism for the few) it might make sense to join a  bank or wirehouse. The rule going in of course if 90-95% of the hires at large firms are fertilizer for larger interests right from the start. The retension raters speak for themselves and even if you succeed and get a reasonable advantage from big-eating-small culture you will always pay the premium for the opportunity.

For the average person (client or broker), independent is better. The real discussion should be about which independent firms are closet wirehouses themselves and explore why brokers can’t be regulated independent of the sleazy NASD firm system all together. Consumers and brokers win in that model and the wirehouse would vanish or reform themselves to a point your wouldn’t recognize them from today or the recent 50 years.

If I valued a recruiter it would be one that is closer to a brokers agent rather than a paid tool for a wirehouse or banks interest. This requires a higher level of skills than most recruiters have and a better system than exists today to support such a model. Brokers would be better off if they paid their agents directly rather than get a constant stream of snowjob from corporate recruiters who mosly represent a middle management systems that would be unemployed quickly in a free advisor system I’ve discussed.

For the person who started this thread; you do better than any of the choices you mentioned.

I’ve been in the business for thirty five years and I cannot understand a thing you’re saying.

[quote=Soon 2 B Gone]No, what I've said is that virtually nobody who is a star at a wirehouse will bother to leave.

There are lots of mediocre brokers who leave rather than get shoved, or who get shoved and go the independent route.

Like Jeff I too have seen a lot of people returning to wirehouses after flirting with the idea of being independent and realizing that it's a mirage.

You have said you have never lived or worked within sixty miles of a wirehouse.  Does that mean you do not have a formal education?
[/quote]

Yes, I have a bachelor's degree from a state university, and yes, there was a wirehouse office in that city.  Mea culpa.  I wasn't looking for a job in this industry at that time as I was an accounting major.  SINCE college, what I said is 100% true...I'm not a big city type person.

I don't believe anything you say about career migration...your views are as biased as anyone's.  I'll bet when the objective numbers are in, more quality advisors are going from wirehouse to indy than vice versa.  The only thing I'll give you is that the majority of quality brokers don't migrate either direction.  If anything, they may change firms, but most probably stay in the same channel due to comfort and familiarity issues.  Quite opposite of what you've said, I've met a lot of quality brokers who went wirehouse to indy and are doing very well for themselves, and again, I'm willing to bet that absolute quantity aside, more are coming my way than are going yours.

[quote=Indyone]

I don’t believe anything you say about career
migration…your views are as biased as anyone’s.  I’ll bet when
the objective numbers are in, more quality advisors are going from
wirehouse to indy than vice versa.  The only thing I’ll give you
is that the majority of quality brokers don’t migrate either
direction.  If anything, they may change firms, but most probably
stay in the same channel due to comfort and familiarity issues. 
Quite opposite of what you’ve said, I’ve met a lot of quality brokers
who went wirehouse to indy and are doing very well for themselves, and
again, I’m willing to bet that absolute quantity aside, more are
coming my way than are going yours.

[quote=Soon 2 B Gone]I agree my views are biased, so are yours.  At last we have a civil debate.  Yes, my views are naturally biased, although I've said several times, that I don't fault anyone for choosing to stay at or go to a wirehouse...it's simply a different career path. (I stand by my signature line, though)

I am not saying, and I don't think Jeff is either, that there are more brokers fleeing the world of the independent to return to a wirehouse. The reason is because most of the independents who were once at a wire were going to wash out if they didn't become an independent.  I won't argue that point...I simply don't have sufficient knowledge to say one way or the other.

Remember, I spent more than twenty years reading, often writing, reports about what was happening in my firm and in the industry.

I also know that managers in the independent channel are extremely frustrated by the fact--as in FACT--that virtually everybody they recruit is a cast off from a bank or a wirehouse.  Well, I was far from a cast-off, but again, I don't have anything except the anecdotal evidence from discussions from my recruiter, who had some wirehouse recruits, but by far and away in his midwest territory, his bread and butter was Edward Jones veterans.

I'll bet that when the biggest hitters at LPL first joined LPL they were about to fail at a wirehouse--they bought themselves more time and capitalized on it in spades.  Good for them--occasionally that is exactly what is needed, more time.  That would surprise me, but again, I haven't taken time to conduct a study to determine if his were true.  The million dollar producers I spoke to sure seemed to have it figured out and it's hard imagining that any of them were ever on the verge of failure, although I'll allow that I didn't ask that question.

I know that a major fault with the wirehouse model is the willingness to cut somebody free who might be a "late bloomer," but the approach has worked well overall.  That certainly seems plausible as publicly-traded companies by focusing on earnings would not have the luxury of waiting out the late bloomers.

You are in the position of defending your decision, yet it was the only decision you could make.  That hardly makes you an impartial voice.  Well, although a wirehouse option wasn't available, I didn't make the only decision I could have made.  I could have suffered through the management stupidity where I was, gone to Edward Jones, Ameriprise, or another bank.  Well, on second thought, you might have a point on that one...

On the other hand I have no dog in this fight at all.  I can tell you that if you were not afraid to live in a town large enough to have wirehouses that you would make more money and have the joy of belonging to a team of guys and gals who are fighting a common battle.  I think you have a mental dog in this fight.  You're proud to have worked for a wirehouse and over the years of looking through wirehouse glasses, you've come to the conclusion that they are far and away the best option.  Having not worked in that environment, I don't have that same bias.  I wouldn't class myself as "afraid" to live in a larger town...it's simply not my preference.  I'm happy to make the 90-minute drive to visit, but I don't want to live there.  No doubt I would gross more in a wirehouse setting.  The jury is still out as to whether I would net as much (I'm thinking no since I would have to nearly double my gross and I'm not sure if I'd want to work hard enough to do that).  Certainly, the "team" feel is not what it is at a wirehouse, and that's the complaint I hear as much as anything, but I'm more of a lone wolf anyway...not anti-social, but I don't crave company as much as others I've worked with.  Several of us new indies have established a network to shoot the breeze occasionally, but certainly, it's not on the level of a wirehouse or superregional office setting.  At the same time, it's a very small factor in my personal job satisfaction.

Sole proprietorships are not all they're cranked up to be.  There are a lot of guys and gals who would trade the abilty to show up at "the office" in their pajamas for the enjoyment of having somebody across the way come and tell you a joke or ask if you've got time to run over to Subway and chat over lunch.  Well, other than my nine to midnight laptop work in front of the tv, I don't work in my PJs, and I do have a professional office.  The furniture in my office alone was over $12K and I have the best desk chair I've ever sat in (a La-Z-Boy Horizon, if you're curious).  I have the comraderie of the employees in the accounting office and I make it a point to eat out routinely with either someone from the office, a customer/prospect, or another local professional (and yes, I go to lunch with several of my competitors on occasion).  Honestly, I think I have a pretty nice set-up, but I will allow that many indies live a pretty quiet life.[/quote]

You must be in a good mood today...

[quote=Seeker15]

No offense Jeff but wirehouses have the capital to pay recruiters and make the best upfront deals. So you might have a little more self-interest involved than objectivity.

<>

If I valued a recruiter it would be one that is closer to a brokers agent rather than a paid tool for a wirehouse or banks interest.

[/quote]

I'm pretty open about my status as a recruiter.  My advice should be taken in context, because my fees are paid by the hiring firms.  Then again, it works the same way for my friend who recruits for independents.

Any brokerage would pull my contract if I did not consistently produce win-win placements.  My job is to find a match, no matter who pays my fee.

Successful brokers are very sophisticated and accomplished salespeople.  You can see a sales job coming a mile away.  The only way to succeed as a broker recruiter is to help both sides understand one another.  We make the decision making process more efficient for both the hiring manager and the candidate.

I stand by my record.  And I resent being called anybody's tool.

I have seen many people come into our complex from Indy, Banks,
regionals, and Wires.  Our average production is about 750k per
rep in the office.  Everyone is pretty happy.   Most people
that come in did less that that prior, but in a very short time they
are there.  I don’t know what it is but it happens.  Maybe I
am just dumb, but I like what I see and succes builds success. 
Our complex and our firm represents the very top of this business and I
am proud to serve my clients as I do, at the firm I am with, adn the
manner in which they support.  If it changes, I will consider a
change but now?  Its just fantastic.  

[quote=JCadieux]

[quote=Seeker15]

No offense Jeff but wirehouses have the capital to pay recruiters and make the best upfront deals. So you might have a little more self-interest involved than objectivity.

<>

If I valued a recruiter it would be one that is closer to a brokers agent rather than a paid tool for a wirehouse or banks interest.

[/quote]

I'm pretty open about my status as a recruiter.  My advice should be taken in context, because my fees are paid by the hiring firms.  Then again, it works the same way for my friend who recruits for independents.

Any brokerage would pull my contract if I did not consistently produce win-win placements.  My job is to find a match, no matter who pays my fee.

Successful brokers are very sophisticated and accomplished salespeople.  You can see a sales job coming a mile away.  The only way to succeed as a broker recruiter is to help both sides understand one another.  We make the decision making process more efficient for both the hiring manager and the candidate.

I stand by my record.  And I resent being called anybody's tool.

[/quote]

Jeff, you're not anybody's tool. Everybody's tool? Sure, but not anybody's tool.

I stand by my record.  And I resent being called anybody’s tool.

Jeff's clients may be the firms but he has to ensure that the brokers he places are well suited to that firms environment.  If he simply pushes reps at firms where they're unsuitable those firms won't accept his candidates anymore.

And to say that the current system isn't good for producers is ludicrous (sp?).  What's good for producers is that there is a large variety of career paths in the Financial Services industry.  Wirehouses, Regionals, Banks, Indy's, RIA's, Insurance B/D's all have their place.  Advisors thrive under different models, so the more options there are the better off people will be.

[quote=FreedomLvr]

Jeff’s clients may be the firms but he has to ensure that the brokers he places are well suited to that firms environment.  If he simply pushes reps at firms where they’re unsuitable those firms won’t accept his candidates anymore.

And to say that the current system isn't good for producers is ludicrous (sp?).  What's good for producers is that there is a large variety of career paths in the Financial Services industry.  Wirehouses, Regionals, Banks, Indy's, RIA's, Insurance B/D's all have their place.  Advisors thrive under different models, so the more options there are the better off people will be.

[quote=Seeker15]

[quote=JCadieux]

I stand by my record.  And I resent being called anybody’s tool.

The recruiting industry used to be funded by CPFs (candidate-paid fees).  Alan Shonberg, founder of MRI was one of those that helped change the way in which the industry functioned and now it is driven by EPFs (employer-paid fees).

Obviously each recruiter will have their handful of key accounts that they will work on that can serve as a "cash cow".  Most of these instances are built by relationships.  I, too, have worked for wirehouses, regionals and independents.  While I worked for Smith Barney, for example, I have found that it is not the right fit for everyone and only represent a handful of offices (3-4) throughout the country where I feel there is a good relationship and I'm not telling a story about Smith Barney, but a story about a specific office or branch manager. 

Our group has been around for 37-38 years and we have had many relationships throughout the industry that we have maintained throughout that time.  While I think that it is helpful to have key accounts, it is such an advisor-driven business in this day and age (with all of the players in the industry looking for the same producers) that I think recruiters can't ignore the needs of a specific advisor and understand that they may not be buying what we're selling. 

Personally, I try to find out what it is that an FA is looking for to see what firm/office may be the best fit for them.  If that is a client of mine, great.  If not, I may have a relationship with another firm/office that they may be a better fit with.  My career is built by maintaining relationships, much like an FA.  If I simply try to slam a square peg in a round hole all day, I will not be successful.

When I am working with my mutual fund managers/analysts, for example, I will take a strong candidate into the marketplace (with their permission, of course) to try to find them the right opportunity as opposed to simply selling them on what I'm working on today.  It keeps a constant flow of new client acquisitions coming across my desk and I'm still able to recruit on the open positions I have with other clients.

Each industry and recruiter is different.  I tend to agree with both Jeff and Seeker that you have to be a consultant for not only the client, but the professional that you are working with, and that may require taking that info out into the marketplace and seeing what else may be the right opportunity for them.

I guess my last post was a littel too aggressive for the forum and was deleted.

BrokerRecruit; My point stands that it is only arcane structures that mandate the “employment” status and that “employer paid” means you are a tool of management. This may be useful for those geared toward employment concepts but an issue for a large group who think of themselves as self-employed or small business owners.

Why do these “you must be an employee” rules still linger? Clearly there are winners and losers in this artificial process. The recruiters are writing nice brochures here while avoiding the substance of my observation; they are conflicted from the point of view of advisers and should step up and admit it. If you really worked for advisers you would be advisor agents not employer recruiters and we wouldn’t be mandatory “employees” to serve NASD interests. The public has certainly suffered for it through every type of firm abuse passed on in the “employment” system; proprietary products, trading conflicts, revenue sharings it goes on a long way.

Registered Rep would be a better more important magazine if it wasn’t “free”, funded mostly by dealer and vendor ads.  I’d rather pay a $100 a year if spoke more for producers and less for the hostage holders who demand we be “employees” if we collect a regulated commission.

The recruiters claim they are true consultants isn’t logical and stands refuted. If a real estate broker made such a false representation regarding interests they would be sanctioned. Then again recruiters don’t have licenses specific to their jobs do they?

Seeker - For my clarity, if I were to work with you and, subsequently, place you at the firm that was best-suited for you, you would pay for my services?

[quote=Seeker15]Then again recruiters don't have licenses specific to their jobs do they?[/quote]

There is not a license or group of licenses, per se, but there are designations that one can earn through a series of exams and a required length of service within the industry.

[quote=BrokerRecruit]

Seeker - For my clarity, if I were to work with you and, subsequently, place you at the firm that was best-suited for you, you would pay for my services?

[quote=BrokerRecruit]

[quote=Seeker15]Then again recruiters don’t have licenses specific to their jobs do they?[/quote]

There is not a license or group of licenses, per se, but there are designations that one can earn through a series of exams and a required length of service within the industry.

[quote=JCadieux]

[quote=Seeker15]

[quote=JCadieux]

I stand by my record.  And I resent being called anybody’s tool.

I don't disagree with you.  The fact of the matter from where I sit is that, yes, I have a list of clients that I work with on the fund and brokerage side that I fill multiple positions for.  However, if something goes sour with those companies or they begin to slip in the ways they treat their employees, I will no longer affiliate with them - no matter how good of a client they are or how much money I have made with them.  I'm confident enough in what I do that I can replicate these efforts elsewhere. 

I take satisfaction in connecting the right people with the right companies, not throwing $#!t against a wall and hoping that it comes together so that I can cash a check.  I don't limit myself to pimping one or two companies because there are different lids to every jar.

We are paid by the clients because we are bringing someone that will improve different things - assets, revenue, analysis, whatever.  I would think that if a rep wanted to pay me for my services, they are a fool.  Does that make me a tool of management?  Not at all because they do not dictate how I spend my time or what I work on - my boss doesn't even do that.  I have full autonomy on how I spend my time, who I work with, how much time I spend on those searches because, at the end of the day, it affects me moreso than anyone else.

Does that make me a tool of management? 

You are paid by management, that’s who represent.

The systematic points have been made but aren’t flattering to recruiters so they are ignored in the non sequitur responses of these interests.

Recruiters can be useful in the current system but they are often stooges as this thread indicates. Brokers would be better off with agents they pay and the term “rep” should become as insulting to most as it is intended by the people delivering here who need that to validate themselves. The topic is beyond the recruiters here or more likely it’s the “I’m just too stupid to follow what you have stated plainly” approach to rebuttal and discussion rather than address a factual point directly; brokerage management #101. Small wonder most producers distrust both recruiters and mangement much of the time.

Please read my previous posts.  I don't simply represent management.  Sometimes I do - yes.  Most of the time, I don't. 

We are all paid by someone.  Your clients pay your fees - do I consider you a tool of your clients?  No.  We are all serving someone, chief.

[quote=BrokerRecruit]

Please read my previous posts.  I don’t simply represent management.  Sometimes I do - yes.  Most of the time, I don’t. 

We are all paid by someone.  Your clients pay your fees - do I consider you a tool of your clients?  No.  We are all serving someone, chief.

If his argument is that I’m a tool because someone pays me fees, then the same would hold true for him.

Joe,

This thread is lost cause as most are for the same reason. People choose to avoid the logic that doesn't flatter their claims when they make them.

These guys have trouble admitting they work for the management, what does that say about them? The industry and segment we might be in?

Double talk in, double talk out. Recruiters can be useful but I doubt the trolls on these boards would qualify; they need "reps" and "tools".

[quote=BrokerRecruit]If his argument is that I'm a tool because someone pays me fees, then the same would hold true for him.[/quote]

Another non sequitur. The roles of custodian, advisor or sales agent are always well defined in our sector (they should be at least). If we misrepresented it as you have attempted about yourselves we would be sanctioned.

What gets me are the big generalizations as if you guys have any qualified insights at all on firms, employment or owning businesses. It started with a few points of fact that couldn't be argued (but were) and they it grows. Brokers do deserve agents by the way, saying you are in affect isn't the same thing.

[quote=Seeker15]

Joe,

This thread is lost cause as most are for the same reason. People choose to avoid the logic that doesn't flatter their claims when they make them.

These guys have trouble admitting they work for the management, what does that say about them? The industry and segment we might be in?

Double talk in, double talk out. Recruiters can be useful but I doubt the trolls on these boards would qualify; they need "reps" and "tools".

[/quote]

I appreciate the flattery, since you have no idea as to who I am or how I work.  Here's a thought - if you are such an advocate of recruiters being agents for REPS, why not hire me, then I don't need to be a TOOL for management, you boob.  Then you can say you are solely responsible for changing the recruiting industry and I can be the Drew Rosenhaus of the brokerage industry by representing an A-hole client.

[quote=Seeker15]

This thread is lost cause

[quote=BrokerRecruit][quote=Seeker15]

Joe,

This thread is lost cause as most are for the same reason. People choose to avoid the logic that doesn't flatter their claims when they make them.

These guys have trouble admitting they work for the management, what does that say about them? The industry and segment we might be in?

Double talk in, double talk out. Recruiters can be useful but I doubt the trolls on these boards would qualify; they need "reps" and "tools".

[/quote]

I appreciate the flattery, since you have no idea as to who I am or how I work.  Here's a thought - if you are such an advocate of recruiters being agents for REPS, why not hire me, then I don't need to be a TOOL for management, you boob.  Then you can say you are solely responsible for changing the recruiting industry and I can be the Drew Rosenhaus of the brokerage industry by representing an A-hole client.

[quote=JCadieux] [quote=Seeker15]

This thread is lost cause

Joe,

Drew Rosenhaus would goal for you clowns to aspire to rather than Danny DeVito in Tin Men.

[quote=Seeker15]Joe,

Drew Rosenhaus would goal for you clowns to aspire to rather than Danny DeVito in Tin Men.

[/quote]

At least we can form complete sentences in something resembling correct grammar!

Brilliant retort clown.

would be a goal

feel better fool?

[quote=Seeker15]Brilliant retort clown.

would be a goal

feel better fool?

[/quote]

Yes I feel better.  Glad you could address the issue…

Mr. NASDY- if you are a million dollar producer, or a million dollar manager, you soon will be a $200k producer because you have your head buried deeply in the sand. You are the GM or F of the financial world- absolutely in denial that quality financial advisors don't go indy.

You have no stats- and you have no credibility, because if you ever had the stats you would  not have made such a ridiculous statement that deserves addressing, then dismissing.

Keep up the good work. With ignorant people like you on this forum the indy arena will continue to grow away from the staunchy, arrogant, profit centers you seem so inclined to put on a pedestal that is, oh by the way, not far from crumbling. If you don't believe that, look up how many FA's from Advest, Legg Mason, Piper, and MacDonald that took the acquisition opportunity to bolt and go independent- it's staggering- and so are you (don't fall off your horse)

WealthAdvisor,

That is the best post on this thread.

[quote=joedabrkr]

[quote=Seeker15]Brilliant retort clown.

would be a goal

feel better fool?

[/quote]

Yes I feel better.  Glad you could address the issue…
[/quote]

The issue being my grammer and spelling when I type quickly on an internet thread? or the issue that you work for dealer management which is often on the other side of the table from producers or individuals? Maybe you should try a free-lunch seminar or 30% off coupon while you have that opportunity as well.

I addressed both issues through the thread.

[quote=Seeker15]

[quote=joedabrkr]

[quote=Seeker15]Brilliant retort clown.

would be a goal

feel better fool?

[/quote]

Yes I feel better.  Glad you could address the issue…
[/quote]

The issue being my grammer and spelling when I type quickly on an internet thread? or the issue that you work for dealer management which is often on the other side of the table from producers or individuals? Maybe you should try a free-lunch seminar or 30% off coupon while you have that opportunity as well.

I addressed both issues through the thread.
[/quote]

Actually the “issue” would be that you’re an idiot!

Get your facts straight-I don’t work for “dealer management”, whatever that may be.  I never said anything to imply such. In fact, I’m an independent financial advisor and have said as much on various threads.  Clearly you have me confused with others, you clueless moron!

Oh, and by the way, it’s spelled “grammar”.

[quote=WealthAdvisor]

Mr. NASDY- if you are a million dollar producer, or a million dollar manager, you soon will be a $200k producer because you have your head buried deeply in the sand. You are the GM or F of the financial world- absolutely in denial that quality financial advisors don’t go indy.

You have no stats- and you have no credibility, because if you ever had the stats you would  not have made such a ridiculous statement that deserves addressing, then dismissing.

Keep up the good work. With ignorant people like you on this forum the indy arena will continue to grow away from the staunchy, arrogant, profit centers you seem so inclined to put on a pedestal that is, oh by the way, not far from crumbling. If you don't believe that, look up how many FA's from Advest, Legg Mason, Piper, and MacDonald that took the acquisition opportunity to bolt and go independent- it's staggering- and so are you (don't fall off your horse)