INDUSTRY NEWS

Advisor leaves RayJay IBD to go RIA with $1B AUM

An advisor who this month left Raymond James has launched an independent RIA and wealth management firm, starting off with $1 billion in client assets.

That new firm, Crux Wealth Advisors, is founded by Travis Alexander, who was at Raymond James since 2016 and had been with Ameriprise from 2008 to 2016. Alexander had started Crux in 2016 under Raymond James and had grown it to more than $3 billion in assets under management, one of the top 10 branches for 12-month trailing revenue at the wider financial services company.

The now independent firm is using Arete Wealth as its broker-dealer and insurance agency. BNY Pershing providers clearing and custody.

Our Take:

“Why would a top producing team leave RJ IBD to go to start their own RIA and custody with Pershing?” The answer is simple: Not all “Independence” is equal. Sure the IBD channel has advantages over the captive broker dealers in that you typically own your book of business and have some tax breaks…other than that, the grass is really not much greener. I would know since I spent time at RayJay IBD and Edward Jones.

The misconception is that the IBD channel like RayJay and Ameriprise has better technology and better compliance than a place like Edward Jones. The reality is that the compliance and technology at these larger firms are designed for the “lowest common denominator” to not screw it up versus being built for the top producing advisors to scale and grow. This is the simplest way to think about it, and it’s why top producing advisors are leaving the RJs and EJs of the world and going RIA.

The compliance and technology in the RIA world is designed to drive advisor growth and client experience. It’s not much different than free market capitalism…because the advisor has choices, the advisor and, by proxy, their clients get better outcomes. This is why there has been a mass exodus of advisors the last few years going RIA and it will only continue to grow.  

INVESTMENT NEWS

How Are Alts Impacting Advisor Growth?

Matt Brown founded CAIS in 2009 with a vision of democratizing alts investing and opening up access to firms of all sizes. And that it did: Platforms like CAIS have leveled the playing field for independent firms by giving these advisors everything they need to compete with the biggest names in the business.

CAIS has realized extraordinary success, doubling in network assets from $3 trillion to $6 trillion in the last 12 months alone.

As Matt shares, the firm’s growth is indicative of a changing environment among investors moving beyond the traditional 60/40 portfolio to one that looks more like a 50/30/20 model based on stocks, bonds, and alts.

Our Take:

We may be biased, but the ability to offer true alternative investments has been a game changer. Clients and prospects seem to appreciate the idea of having access to a broad universe of high quality alternatives such as private equity, private credit, private real estate, hedge funds, etc. if and when it makes sense for them. If you’re not able to offer your higher net worth clients access to more than vanilla investments, you are risking them going someplace else that can.