Investment Research, Inc.
1776 Pleasant Plain Road; Fairfield, IA 52556
Number of Back-Office Employees*: 245
Number of Advisors: 1,108
Total Client Assets Under Management: $31 billion
Advisors' Average Length of Service (in industry): N/A
Total Revenue Year to Date**: $241.5 million
Revenue from Commissions: $99.2 million
Revenue from Fees: $142.3 million
Average AUM per Rep: $28 million
Average Payout per Rep: 89%
Average Production per Rep: $234,000
Number of Dually Registered Reps: 997
* As of 12/31/2007
** As of 12/31/2007, non-audited
Registered Rep.: Why would arep want to leave his firm to join yours?
Eric Schwartz: We are the preeminent fee experts, poised to guide them in achieving total freedom to serve their clients, and in ownership of their own businesses without sacrificing capacity and quality.
RR: Other than your own, of course, which other independent broker/dealers are you impressed with and why?
ES: Broker/dealers that are truly independent, and free to do what is right for advisors and clients. That means not owned by a parent, venture capitalist or the public.
RR: Least favorite compliance rule?
ES: Any rule that does not allow advisors to do what is best for clients.
RR: Are your affiliated advisors fee-based or mostly commission/transaction advisors?
ES: We have been the leader in fee business for the past 15 years, so our rep/advisor fee revenue is currently over 60 percent.
RR: How many of your reps are dually registered? Is that number growing or not?
ES: As the firm that invented the hybrid model, we are proud to have 90 percent of our advisors dually registered with Cambridge'sor an outside RIA. The number continues to grow.
RR: The most expensive aspect of running your independent b/d firm in 2007?
ES: High-quality, well-trained staff, with the authority to customize solutions, and well-crafted technology are key to our advisors.
RR: Your recruiting goals through 2008 and beyond?
ES: To recruit the highest-quality most client-centered advisors.
RR: What are your thoughts on upfront bonuses?
ES: The cost of moving a practice varies widely and can be significant; we stand ready to bear that expense.
RR: The ideal advisor is? (Three words or less.)
ES: Totally client focused.
RR: Biggest challenge in 2008 for the independent channel and your firm?
ES: To creatively build on our fee leadership, and expand our uniquely flexible and customized advisor solutions in this increasingly difficult regulatory environment.
RR: The best technology investment your firm has made?
ES: Internal development of the industry's most efficient virtual-office suite for advisors.
RR: Best advice you can give a wirehouse rep thinking about going independent?
ES: Never forget, your clients hired you — not your firm.
RR: What challenges will you face over the next five years?
ES: Building highly customized flexible platforms and programs to address clients' upcoming retirement-income needs, and navigating acquisition and succession-planning services for our advisors.
RR: If you could meet one business-related figure, dead or alive, who would it be, and what would you ask?
ES: Warren Buffet. I'd ask how to go about motivating and encouraging current and potential team members to want to stay long term when a quick hit from a sale or going public may seem appealing.
RR: In 10 years, your firm will be?
ES: We are looking for more of the same: helping fee-oriented advisors do better for their clients and themselves.
RR: A book every financial advisor should read?
ES: Good to Great by Jim Collins.