We often talk about how advisors’ mindsets have changed, having evolved to wanting more from their firms. And likewise, clients, too, are looking for more from their advisors. And as such, many advisors – particularly those managing high net worth clients – are coming to realize that the wirehouses cannot answer these changing demands. That is, managing to the lowest common denominator imposes limitations on advisors when it comes to customizing client service.
For example, just over a year ago, Terry Cook was managing $1.3B in assets at UBS—a business he built over nearly 3 decades in the wirehouse world: 17 years at UBS and 9 years prior at Merrill.
As Terry tells it, their 13-member team operated much like a boutique multi-family office within the wirehouse, serving a small number of clients; primarily affluent, multi-generational business owners.
But as time went on, he found their clients wanted more from them beyond investment management—from booking travel to advising on health care choices. All things, as he puts it, “that would give any wirehouse heartburn” should you even consider it.
In fact, when Terry submitted a presentation for a group of high net worth prospects, it was returned red-lined—with many items that the wirehouse deemed “not the advisor’s role.”
As a self-proclaimed planner and problem solver, Terry realized that firms like UBS simply cannot support a business like his. Ultimately, to meet the additional lifestyle management demands of his clients, be more nimble and offer a broader suite of services, he’d need to make a change.
So in October of 2019, Terry, partner Kyle Caouette and their team left UBS and launched independent RIA firm Parcion Private Wealth in Bellevue, Washington.
In this episode, Terry talks candidly about the journey – both as a wirehouse advisor and now as a business owner – including:
- What he and his team needed to consider in the decision to make the leap—and why independence proved to be the better option over another wirehouse.
- What he found to be limitations in how he served his clients—and what specific “additional resources” and services fell well outside the margins of what was allowable at UBS.
- How the notion of the “commoditization” of investment management impacted their decision to build an independent firm—and how being “untethered” allows them to better meet their clients’ needs.
- How compensation is different as an independent firm—and how the ability to equitize his staff improves everyone’s opportunity to succeed.
For Terry, making the leap was “like taking the ankle weights off” in terms of how he can serve his clients and grow his business. Now, untethered, he and the team at Parcion could specifically meet their clients’ demands and help them in the areas that they needed the most—which fulfills the responsibility of being a true fiduciary.
It’s a great conversation that explores the true potential of an independent firm when it comes to servicing clients—a candid eye-opener for captive and independent advisors alike.
