By Billy Hopkins
At Silver Oak, we’re no strangers to the advisor transition process; in fact, we’ve made it a cornerstone of our business to help financial professionals transition as seamlessly as possible to our firm.
But the transition process is constantly evolving, with new regulations, technologies and business models creating a more complicated, if also more efficient, transition landscape.
I recently sat down with advisor transition expert Grier Rubeling, founder of Advisor Transition Services, to get her perspective on what’s changed, what today’s transitioning advisors need to know, and what to look for in a new firm. You’ve probably heard of Grier, downloaded one of her handy tools, listened to her interview on Michael Kitces’ podcast, or read one of her many articles on transitions.
Transitions are her thing. She’s passionate about helping advisors make these big moves because, as she says, joining a new firm or starting one of your own is not just a business choice, but a life choice, and it is critical to choose the right business (and life) partner.
Billy: Over the past decade, what are the biggest changes you’ve seen in the advisor transition process?
Grier: I’ve been doing transitions for 17 years and the process has changed astronomically over that time. The addition of DocuSign alone has been a complete game-changer. Even though it isn’t an industry-specific tool, it’s able to integrate with a number of financial services technologies to make it so much easier to collect data, fill out paperwork and streamline the overall custodial process. Form-filling technology has made a huge difference.
Just six years ago, I was still filling out documents manually. I also remember being asked to submit paperwork via fax long after fax machines had stopped being manufactured. Submission standards have certainly improved tremendously over the past few years.
Even the rules of data collection have changed. Previously, transitioning advisors were limited to broker protocol or non-broker protocol with regard to the data they could bring with them, but now there’s a lot more opportunity to collect client data and do things proactively. That opens up the door to use technology prior to a transition to make the transition itself easier with data feeds, rather than doing a lot of manual entry.
Billy: What impact do you think COVID had on the industry and the transition process?
Grier: COVID was a game changer. Prior to the pandemic, particularly in the wirehouse and broker-dealer arena, everything was very focused on being in the office and using on-prem technology. It was sort of unheard of to log into your systems outside of the physical office location.
COVID made that approach impossible. The industry had to make a shift. Those who embraced the opportunity to implement a more future-forward working model were able to recruit and retain more of an advisor base than those who stuck to their in-office mandates.
Billy: What’s your best advice for advisors considering, or in the process of, a transition?
Grier: The old way of thinking, which was basically, ‘I’m just going to repaper everything and open new accounts and figure it out as I go’ is no longer viable. COVID made transitions and work in general more flexible, but it also created significantly higher expectations of service providers across every industry, including financial services.
Clients don’t want to wait for you to figure it out. Everybody expects delivery right away, including clients. If you’re leaving a firm where the advisors on the other side might be calling your clients and trying to retain your business, you better be able to move quickly. That means knowing ahead of time how to open accounts, what information is going to be required, what you can collect in advance versus what needs to be collected after the fact. Every minute that takes you longer than the next person is a minute you could lose out on a client because you’re not providing a solution fast enough.
Billy: Speaking of clients, how do you recommend transition advisors communicate changing firms to them?
Grier: Everyone wants to call their clients and say, ‘Give me your social and date of birth and I’ll have your paperwork to you in 24-48 hours.’ But you’re setting yourself up for failure if you’re trying to convey that things are going to be done quickly and easily, without a lot of effort on your part or theirs.
Advisors are much better off telling clients the truth about what they’re going to have to do. Set expectations that things might go wrong, and that you may have to reach out for more information. Because if you tell them something is going to happen right away and it doesn’t, that can cause a lot of concern about what might go wrong in the future.
By the way, I recommend advisors do the same expectation setting for themselves. Yes, you’ll be working a little bit harder for a period of time, but everything is temporary. It’s going to be hard work, but it doesn’t have to be extremely difficult or impossible, especially if you have a support system at your new firm.
Billy: What do you think advisors should be looking for in terms of transition support?
Grier: First and foremost, do your due diligence. Don’t just focus on firms that promise a transition team. In some cases, the folks telling you about the transition support are recruiters, who have no idea what the transition team is actually going to do for you. Not because they aren’t good at their jobs, but because they aren’t the ones doing the transition work.
Before you sign on the dotted line, have a real conversation with the team that’s actually going to be providing operational support. Even then, don’t make transition support the majority of your final decision. I’ve seen firms roll out the proverbial red carpet as part of an advisor’s initial experience, only to have that support all but disappear once the advisor becomes a cog in the wheel.
You have to understand that you’re choosing a partner and a culture you’re going to be part of long after the transition period ends.
Billy: In your experience, what’s the one thing that gets advisors over transition uncertainty? Why do they ultimately take the leap?
Grier: Most of the time, once an advisor has made the decision to leave their firm, there’s very little that’s going to stop them from doing so.
If you’ve made the decision to leave because you need to be at a different place or in a different model because that’s what’s right for you, your firm and your clients, it really becomes about feeling like you have enough prepared. And you’re never going to feel like you have enough prepared. You’re never going to feel like you’re completely ready.
It’s like having a baby. Transition is like having a baby.
You spend all of this time and effort nesting and getting everything ready. And then, yes, you’re going to go through a very short period of immense pain and suffering.
But then on the other side, you’re going to have this beautiful new thing that’s a part of you, that you wouldn’t change for the world.
That’s how you have to think about it. I want to get to the other side so that I can actually start living my life and doing things the way that I want to.
Based in Nashville, TN, Billy Hopkins is the CEO and founder of Silver Oak Securities and Grier Rubeling is the Founder of Advisor Transition Services which is located in Cary, North Carolina.
