For the most successful advisor firms emphasizing organic growth, competing for top talent to strengthen their ranks and enhance client service capabilities has become essential. Expanding capacity and capability have become major trends in talent acquisition. More advisor firms are trending toward recruiting experienced advisors. Yet, recruiting these seasoned advisors remains a challenging endeavor.
The dynamics of advisor recruitment and the emergence of break-away brokers have become pivotal narratives shaping the industry's landscape. Amidst this backdrop of change, the Diamond Consultants Advisor Transition Report serves as a beacon – shedding light on the myriad trends and insights driving these phenomena.
The report identifies several causal factors that most heavily influence advisor movement, with firm culture, technology offerings, and compensation structures among the primary considerations. In a competitive environment where talent is highly sought, firms must distinguish themselves by offering compelling value propositions around these key drivers to attract and retain top-tier advisors.
Additionally, the report underscores the steady migration of advisors leaving established brokerage firms to launch independent practices or join smaller, more agile firms. While the reasons for breaking away are many and vary from broker to broker, the report identifies several key factors as principal drivers of independence:
According to a recent Tiburon report, nearly ¼ of all current advisor movements (~15,000/yr) are breakaway brokers who bring more than $1.3 trillion of client assets into play.1
As competition for advisor talent intensifies, the poaching of top performers may soon become the greatest existential threat to your firm’s continued success and sustainability. In response, you’ll need to strengthen your defenses and explore new and creative ways to retain the future leaders of your business.
Taking a closer look into the intricate tapestry of financial advisor recruitment and break-away broker trends, the Diamond Consultants report also highlights several other interesting findings, including:
The Diamond Consultants Advisor Transition Report offers invaluable insights into the evolving landscape of advisor recruitment and breakaway broker motivations. By understanding these preferences and drivers of movement, you can help better tailor your recruitment strategies to attract top talent and cultivate a thriving advisor community. As the industry continues to shift, firms that can remain agile and responsive to changing dynamics will undoubtedly be the beneficiaries who most thrive in this competitive marketplace.
1 Financial Advisor Recruiting & Break-Away Brokers, Tiburon Strategic Advisors, December 2023