Advisor to athletes and tech pros drops BD after launching RIA

A financial advisor who says his practice has expanded by more than $200 million in the past six years dropped his longtime broker-dealer after launching an RIA.

Assets under management at Palash Islam’s Synergy Financial Group surged to $225 million this year from $21 million at the end of 2013, according to Islam, who onced worked as an NBA front-office employee with the Seattle SuperSonics. His California Bay Area practice caters to professional athletes, coaches and technology professionals, especially SpaceX employees.

Just as with many financial advisors who drop BD and FINRA registrations to go fully independent as RIAs, Islam’s decision came down to simple economics after having “a really good relationship over a long period of time” with KMS Financial Services, he says. Islam estimated it would cost an extra $50,000 to $140,000 out of a $1-million book of business to stay with the Advisor Group BD or its rivals.

“Once you're getting to about $600,000 of revenue, then you have to consider other opportunities besides the broker-dealer space because the delta is too high,” Islam said in an interview. “It’s real money.”

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The RIA’s registration with the SEC became effective in August, and Islam left KMS on Oct. 30 after 14 years affiliated with the firm, according to FINRA BrokerCheck.

Representatives for KMS — which is itself formally closed after Advisor Group folded the three smallest ex-Ladenburg Thalmann network firms it acquired last year into the largest, Securities America — didn’t immediately respond to requests for comment.

Islam’s practice includes client relationship manager Renee Schroder, paraplanner Shannon Irwin and paraplanner Chelsea Hodl, a CFP who joined San Ramon, California-based Synergy last week. Synergy uses Charles Schwab and Pershing as its custodians, and it charges fixed planning fees of $5,000 to $15,000 per year, depending on scope and complexity, according to its SEC Form ADV brochure.

The practice lists $165 million in AUM from 80 clients, though Islam says it has grown since its last filing and the number he advises on amounts to roughly $1 billion when including private stock plans and other outside investments. Its annual revenue has risen to $1.4 million from $800,000 a year earlier, according to Islam.

While he declines to share any clients’ names, he says the practice has attracted them by offering them services in every aspect of planning from estates and taxes to discussing their potential business plans with them.

“We're laser-focused on just one thing: The client experience — that is the only thing that matters to us,” Islam says. “We want people to reach out to us on a regular basis. What I’ve found is, the more curious the client, the more successful they are.”