Almost a year later its passage from a supervisory jurisdiction office under Raymond James, Concurrent is moving into “growth mode” as a multi-custodial, hybrid RIA platform for independent advisors.
Underscoring the new focus, the firm announced a handful of hires made this year in support of accelerated growth and improved advisor services. All come from RIA or well-known institutions.
In January, Concurrent recruited Joe Mooney, who managed East Coast custody sales for Fidelity, and Bo Ellison, who left his role as Creative Planning's retirement services division controller.
Ellison, who has been named CFO of Concurrent, will also act as the lead architect of the M&A deals. Mooney will lead advisor engagement and enterprise development, leading recruiting teams in support of new advisor acquisition and onboarding efforts.
On the organic front, Concurrent hired Kerry McDermott earlier this month to lead program development, strategy and growth. She came from Wealth Enhancement Group, where she led partner development and will work to develop and deliver client leads to advisory teams through various partnerships and affinity programs with trade organizations, CPA networks and other centers of influence.
Matthew Unger, who joined this week from Goldman Sachs, will also support organic growth by developing and leading an internal financial planning team to support Concurrent's growing network of advisors.
McDermott and Unger will both report to the Managing Director of Strategy and Growth Casey Bates, who joined Concurrent from Goldman Sachs last April. Prior to Goldman, he was with United Capital for nearly two decades.
Co-CEO Nate Lenz said the moves are indicative of the firm's broader strategy.
“We're back on the front foot,” he said Wealthmanagement.com in New York City this month. “We're back in growth mode and those are all areas we're addressing.”
“We intend to continue our flow of inorganic growth and make acquisitions of minority equity as well as full buyouts. We find ourselves in conversation now with many existing VNRs looking to either reduce their enrollment or inherit. A lot of firms are somewhat similar platforms to ours, so they fit very well and we think we can help them take advantage of further economies of scale and really get to the next chapter of growth. Bo has been a great addition on that side of things.”
Lenz said bringing in experienced wirehouse talent to RIA was a deliberate move to better compete with independent broker/dealers like LPL and Cetera.
“The bottom line is deals are becoming more competitive in the IBD space,” he said. “Which is putting pressure on us to make sure we're not going to be competitive in the same way. We do not deal with traditional forgivable loan structures; we are not made that way.”
Lenz explained that breakaway advisers launching independent practices on the Concurrent platform access liquidity through the purchase of minority equity at capital gains rates, and said that while the structure has advantages, it may not be for everyone. Firms also take an equity stake in Concurrent, he said, and those that need more liquidity can sell a larger stake. Outright sales are not off the table, but they are not preferred.
“Firms that are a good fit for us have bought into the power of the platform we've built,” Lenz said. “At the end of the day, we want them to be fully independent and have access to multiple caregivers and better technology. Our fees are competitive, but I wouldn't say we're the highest on the street.”
Lenz noted that the centralized planning team that Unger leads will provide more than an outsourced service to Concurrent's advisors/clients. It is intended to double as part of a lead generation channel currently under construction as well as a talent development channel.
About 58% of the firm's $19 billion-plus assets are under its corporate retirement business, and Concurrent has partnered with TIFIN to build a digital advisory service for plan participants that will serve as the funnel's entry point. Advanced inquiries and wealthier participants will be referred to the centralized planning team and when they reach the point where a dedicated personal advisor makes sense, they will be introduced to a suitable platform firm.
“Over the next five years we want to train 100 new advisers to enter the business,” Lenz said. “This is strategically important to our long-term viability as a firm. We are not immune to the demographic issues our industry faces around succession planning, and so we believe anyone who can develop talent will win.
“The planning group is a great first step for graduates of financial planning programs who have some degree of competence but have never worked with a client,” he said. “If we can take the skills that they've developed, whether it's in a university program or a few years of work experience and tie them together with an experienced advisor and have them handle the financial planning work to add value , they will also get to ride shotgun in those conversations.
“So it ends up being a hands-on situation, which is a great way for them to develop,” he said of the strategy, which resembles other internal development efforts at large RIA firms. facing the question of talent.
Concurrent recently opened an in-house insurance business, and Lenz said expansion into tax planning and family office services is the next possible move. In fact, the firm has already been in talks to buy a family office.
“I think that's where it goes next,” he said. “Accounting and family office services, specifically to serve high net worth and very high net worth clients. While, as a whole, we serve an affluent client base, the top clients on our advisors' books, those who want to repeat, those clients are business owners.”
It also expects to announce an acquisition in the coming weeks, he noted.
Backed by Commercial Investment Management, which increased its investment in support of the transition, Lenz said Concurrent is not interested in taking on any other outside capital.