A major Merrill Lynch Private Wealth team started its own independent firm, in the latest of the movement of advisors into the RIA space attracting planners and backing from private equity.
Financial advisor Ash Chopra launched San Francisco-based Syon Capital after leaving Merrill, where he spent the last 18 years and the 10-person team managed about $4.5 billion in client assets,
For the team led by Chopra — who also had an earlier tenure with Goldman Sachs after spending 10 years as an engineer — the decision to leave Merrill for its own standalone RIA stemmed from the practice's ultrahigh net worth clients' demands for "service and advice that is far wider than what any wirehouse can offer," he said in an interview.
"In my 22 years in the industry with wirehouses, I've had amazing experiences and learnings," Chopra said. "Those questions came up so many times that we started to wonder if we should send those clients elsewhere or change our model."
Representatives for Merrill — whose parent firm, Bank of America, reported a roughly
It came as another RIA that opened more than 30 years ago, Sequoia Financial Group,
Other than the size of the investment, Valeas and Akron, Ohio-based Sequoia didn't disclose financial terms such as the RIA's valuation or the percentage of equity exchanged in the transaction. The deal is expected to close Oct. 31, and Sequoia remains a majority employee-owned firm, according to founder Tom Haught.
Sequoia listed $4.7 billion in client assets with 88 employees at the time of Kudu's investment. The RIA now has more than $10 billion in assets under management and 166 advisors and other employees, according to its latest SEC filing. After not making any M&A deals in its first 20 years in business, Sequoia has made 10 in the past decade, Haught said in an interview. It now plans to seek out other independent fiduciaries, abiding by the standards requiring advisors to place clients' interests first, to add to offices in its current footprint of Ohio, Michigan, South Carolina and Florida or states nearby those of its existing locations.
"We really believe there's market demand or market pull for the RIA fiduciary model, and so that's how we're building out our organic growth," he said, noting that other RIAs looking for greater scale or a succession plan are also part of Sequoia's expansion equation. "We believe there will be more of that over the next decade, so we want to be well-positioned for it."
Chopra's team is operating independently from any RIA aggregators while using Charles Schwab as its custodian. The firm has one other advisor, with the other eight staff members of Syon in support and specialist roles.
Since Chopra's formal exit from Merrill, he has been explaining the significance of launching the RIA to Syon's clients.
The clients begin to grasp the industry jargon of the technical change much more clearly when they understand, for example, that Syon can now "advise and guide on assets no matter where they're held," he said. Before, the assets needed to be on the wirehouse's platforms.
The RIA represents the next stage of Chopra's financial career, which began in 2000 after he got an MBA from University of Michigan's Ross School of Business. He had worked for a decade as an engineer after emigrating from India with $3,000 that his parents took out as a loan toward his goal of getting an education in the United States. Chopra attended Kettering University as an undergrad through its "
He connected the launch of the RIA to "the engineer in me," solving a problem affecting the practice's clients, Chopra said, recalling the opportunity to work at Goldman opening up after he got the MBA.
"I had always been interested in finance and investments. I got very impressed by the wealth management industry," he said. "It's very much about client service, and it's very much about keeping things honest and understandable."
