A major LPL Financial enterprise is turning wealth managers’ constant fight for assets into its own potential recruiting gambit for financial advisors who prefer a different broker-dealer.
Last month, Good Life Companies took the unusual step of
While other hybrid RIAs and offices of supervisory jurisdiction offer additional clearing and custody options, the Reading, Pennsylvania-based firm with 200 advisors and $5 billion in client assets plans to eventually offer BD affiliation with Raymond James, Purshe Kaplan Sterling Investments and additional LPL rivals as well, co-founder Conor Delaney says.
Leveraging the fierce competition among wealth managers represents only one novel aspect of Good Life’s business model. The company also owns a chain of food stores called
“The market is telling us, ‘We have advisors for you at this place, we have advisors for you at that place,’” Delaney says. “This is the conduit that we had to build in order to do that.”
He didn’t say whether LPL will be assessing a fee on any brokerage assets in addition to the oversight expenses it collects from hybrid RIAs for using outside custodians. Good Life’s new RIA does not now have the capability to let its representatives affiliate with Raymond James as their BD, but it intends to offer the choice in the future alongside Harbor and other firms, according to Delaney.
Representatives for Harbor, which uses Raymond James as its clearing firm and custodian, didn’t respond to requests for comment. In an email, representatives for Raymond James confirmed it’s a custody option for Good Life rather than a BD affiliation but didn’t provide any further information. And, for its part, LPL “serves many types of practices as they evolve their businesses,” spokeswoman Lauren Hoyt-Williams said in a statement.
“We value the strong partnerships we have with leading practices nationwide,” she said.
Delaney and fellow Good Life co-founder Courtnie Nein launched the firm in 2012 after moving to LPL from Waddell & Reed, where Delaney was a branch manager and Nein was an advisor.
Delany says he began his financial services career under difficult circumstances. He was 19 and homeless shortly after his father died and his mom became permanently disabled. The organic food chain stems “from a childhood that was framed around poor health decisions and little access to healthy food options,” according to the firm’s website, which lists four locations in Pennsylvania and New Jersey and promises six more coming soon.
Between the food stores, the wealth management enterprise, the Reading-based gym and the insurance agency of 300 professionals, Good Life is working at the intersection of health and wealth, Delaney says. The firm steers clear of city centers, working out of locations like its Berks County headquarters rather than Philadelphia; Northern New Jersey rather than New York City; and Kalamazoo, Michigan rather than Detroit, he notes.
“It's not about me or the leadership team of Good Life, it's about what's best for the advisors to serve their Middle American clients the best,” Delaney says. “Financial services tends to bring with it a tremendous amount of anxiety. If we can lower that anxiety … that actually does a lot to mitigate the stress that goes along with the business.”
Besides Good Life, other large hybrids have been switching up their custodians and BDs — the latest example of the longtime push-pull of RIAs seeking more access to outside vendors while wealth managers aim to stay in advisors’ good graces and retain as many assets as possible.
Private Advisor Group, the LPL hybrid RIA that Good Life used before starting its own SEC-registered entity in 2014, created a limited purpose BD called PAG Financial in October to provide more flexibility for incoming recruits opting for outside custodians. In late May, a Raymond James hybrid RIA, Steward Partners,
“It's a really interesting trend,” says Carolyn Armitage, the
Good Life didn’t set out to become a national firm when Delaney and Nein first went independent, but they noticed a gap in the marketplace when it came to providing turnkey support like real estate, infrastructure and other technology, Delaney says. Now, though, the firm’s approach and evolution is “resonating in Middle America,” he says.
“We're seeing that advisors are shedding the burden of corporate America and working for Wall Street profits,” Delaney says.
