$500 million AUM is a notable achievement for an RIA firm, and they had every right to celebrate when they hit that milestone in late 2021. John and Jennifer, both advisors who formerly worked for an independent broker-dealer, started their RIA only two years earlier. The growth they had experienced since was quite extraordinary.
However, John and Jennifer were not in a celebratory mood. Oh, they were pleased with their firm's growth, which confirmed their decision to invest in the company by adding several new top advisors once they opened their doors. But the operational limitations of their practice were becoming increasingly evident and a hindrance to future growth.
Specifically, senior managers were spending too much time on operations and too little time on essential client service and business development activities. The missed opportunity costs for the firm and its most talented producers were mounting.
The Corporate RIA firm hired associates to help carry many of the operational burdens, mainly trading and billing. But some lacked the experience to effectively manage these activities in bulk, confirming that in-house staffing wasn’t proving to be the most cost-effective solution.
They needed to tackle these problems head-on and believed an outsourced solution with the right Turnkey Asset Management Platform (TAMP) would be the answer. The critical point here is, they needed to find the right partner that fit their firm's wealth management philosophy and compliance needs.
Because of the firm's size and rapid growth, it had received several solicitations from TAMPs vying for its business. But one firm in particular – GeoWealth – appeared to have an intuitive understanding of the challenges the firm was experiencing. More importantly, John and Jennifer were impressed with the technology solutions GeoWealth proposed, their team approach, and the dedicated account representative they would be assigned.
Once the contract was finalized and the transition was completed, GeoWealth assumed responsibility for trading and rebalancing the the firm's model portfolios. This lifted a heavy load off the shoulders of the firms' producers, meaning focus could be put towards growing the firm.
John and Jennifer quickly realized that GeoWealth operated as an extension of their back office, managing activities like monthly billing and quarterly performance reporting with the highest level of attention and white-glove approach to servicing clients.
GeoWealth even uncovered a compliance gap that needed attention and introduced John and Jennifer to an experienced consultant who ultimately solved the challenge.
If this level of support for an RIA by a TAMP seems unique in the industry, it is. Many TAMPs outsource their technology to third-party providers, which inherently creates an arms-length relationship with the client. Because GeoWealth develops its software solutions, it offers flexibility and nimbleness that many other TAMP providers cannot.
The GeoWealth partnership has proven to be a godsend for this fast-growing Corporate RIA. Top producers are now free to concentrate solely on developing new client relationships, accelerating the firm's history of growth. The firm has also found cost efficiencies with its outsourced solution compared to its previous attempts with in-house personnel. Now, the $500 million AUM is a number in John and Jennifer's rear-view mirror as they set their sights on that lofty $1 billion target!
Talk to us if you are encountering similar operational challenges and bottlenecks. We can schedule a live walk through of the platform and discuss how our solutions may help you.
DISCLOSURE: This case study is provided for illustrative purposes only and is meant to provide an example of GeoWealth’s process and methodology. There can be no assurance that GeoWealth will be able to achieve similar results in comparable situations. No portion of this case study is to be interpreted as a testimonial or endorsement of GeoWealth’s investment advisory services.