Key Players on a Strong Transition Team

work group in a team meeting

Having a strong transition team in place can make all the difference as you make the move to becoming an RIA.

“There are key players that you will need on your team to launch an independent firm,” says Christine Castellano, COO/CFO. “We make sure our clients have all of these players on their teams, whether they are from our own organization or from a third-party vendor we help them vet and select.

Among the players necessary to set up a new firm are:

  • Business consultant
  • Project manager
  • Legal counsel
  • Compliance oversight officer

When you are hiring a full-service business consultant such as TruClarity, you should look for one who can provide assistance with real estate, marketing, technology and FinTech, industry-specific software for financial advisors.

In addition, you likely will need to partner with a custodian, a friendly broker-dealer and hire vendors to handle general technology requirements, insurance and human resources needs. In all, a transition could require as many as 15 third-party vendors, and someone has to manage them all, says Castellano. “Hiring the right team saves you time and resources,” she says.

Because TruClarity already has established relationships with third-party vendors, its team members are usually able to negotiate a better price on behalf of its clients.

Using a partner such as TruClarity also allows you to work on your new business in a safe way, so that you are not trying to juggle transition responsibilities while you are working for your current employer. You do not want to divulge your plans to break away before you are ready.

“Everything has to be completely confidential,” Castellano says. “You can’t go out looking at office space or talking to software vendors, especially if you are well-known in a community, because everyone will know what you are doing.”

Pamela Stross, CEO of TruClarity, says a strong support team would handle those tasks for you during business hours so you can carry out your responsibilities to your current employer. “With all of the moving parts that exist in a transition, it is very challenging to do your duty to your current employer and manage the creation of a new firm at the same time,” she says.

Team members with specific expertise or personal experience creating an RIA can help smooth the complex transition process. At TruClarity, team members have been part of organizations that have gone through a breakaway, and they have helped other teams, drawing from their personal experience of the same process. Additionally, TruClarity team members have expertise in areas necessary to a new RIA, such as real estate negotiation, software selection and foundational marketing. It is invaluable to have an experienced professional negotiate your lease, or to have someone who understands software help you narrow the choices for FinTech so that you have to consider only the ones most relevant to your organization. Branding and website development are catalysts to begin the start-up process of your independent firm.

“Advisors have enough hats to wear during start-up and transition that if you just take on the advisor-driven task, and then try to handle start-up and project management in addition, there would not be enough hours in the day,” says Castellano. “It is essential to take on a business consultant partner who can do some of those things for you on a strong transition team.”

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