Items to prioritize before venturing on the RIA journey

Choosing to breakaway and go independent can be a daunting task, especially if you’re doing it solo. But it may not be as challenging or overwhelming as it first seems.

With the right supports in place, going RIA can be incredibly worthwhile and rewarding. As Dr. Preston Cherry points out, a dedication to company culture is one of the many reasons to go independent.

“It’s something that’s being practiced across the whole RIA space,” the founder and CEO of Concurrent Financial Planning said. “A lot of times when firms break away from the traditional model, they want to change the company culture; how they're bringing in new talent and how they're attracting not only new talent to work with, but also attracting new clients, and how they're retaining new clients and retaining the clients that they already have.”

Cherry says asking questions like ‘Do people want to be there and why? Are they being valued? Are they being understood?’ will help with a firm’s culture and philosophy, creating an effective company culture.

Not surprisingly, one of the cons of going RIA is the matter of doing it alone, which takes away from some of the business development that new indie advisors have to do in order to survive. As Cherry noted, “growth costs resources, whether it be in human capital or financial capital.”

Because it can be very overwhelming with so many options available to advisors, it simply may just not be for them, as Diana Cabrices, founder of Diana Cabrices Consulting, points out.

“If you’re the type of person that doesn’t have an entrepreneurial mindset, or you want that work-life balance, then starting your own RIA might not be the best choice. Maybe bolting on or joining into a bigger RIA that already has that support is a better choice,” Cabrices said.

But for those who are willing to undertake the venture, Cabrices highlights a few organizations advisors can connect with, like Chalice Network, Financial Planners Association (FPA) and Advisors Growing as a Community (AGC).

“They're all bundling together to help that solo advisor not feel like they just had the carpet ripped from underneath them when they go independent.”

Nevertheless, advisors are encouraged to keep their eye on the prize and success will follow. Some of the more important priorities when making the transition comes from having the right tools and technology in place. Cabrices believes the main tool for every RIA to focus on is the CRM.

“When you think about this business, it's a relationship business so what technology comes to mind when you think about relationships? It's the CRM. It is truly the hub and the core of the breathing organism that is an RIA,” she highlighted.

“[For] some of the best RIAs out there that I've seen, [CRM] is the one place that they get their entire team in lockstep around. Every touch point that we make with prospects and with clients, everything goes into the CRM. Everyone in the company knows about what's going into the CRM, we're all hands on doing that same standard operating procedure.

“If you want to be client-centric, which is one of the best parts about being RIA, then you should absolutely prioritize the CRM from an operational standpoint,” Cabrices added.

In the same vein as the CRM comes the integration of other tools, like the custodian or financial planning tools, which Cabrices says can also be an important piece.

“The integration aspect, again, can get overwhelming to have all these different tools. If they're not beautifully integrated in ways that make sense, then it might be a little bit more difficult. You need that interoperability between your tech stack,” she noted.

Cherry says focusing on the second tier of the support stack, including programs like Grammarly and Mailchimp, can go a long way for an advisor to help with proofreading and scheduling, respectively. In addition to that, the top areas new RIAs should focus on is estate planning and tax planning, Cherry highlighted, because these are the services clients are seeking the most currently.

Finally, it’s in every RIAs interest to market themselves accordingly. Whether that comes from being unique or having empathy, Cherry suggests writing articles and blogs for community newspapers, “having a consistency of being a being seen” and “pairing blogs so people can find you searchable through SEO”.

Cabrices, on the other hand, suggests making content simple and having a “good content strategy”, noting that websites should be accessible with a contact form, a FAQ, and a video, “where they can get to know you a little bit or get those questions they have answered.”

She encourages “every RIA to make the contact form on your website very prominent and have a calendar tool where they can book a 15-minute chat just to get to know you."

“People want to feel like they can relate to you before they say, ‘I'm going to pick up the phone and call this person to see if they're a good a good fit for me.’

“They need to find something to latch on to," said Cabrices.