Osaic branch bypasses today's conventional path to exponential growth

An Osaic branch has grown to many times its size in just over four years on the strength of recruiting, succession planning and tools for financial advisors.

The AmeriFlex Group — a Las Vegas-based registered investment advisory firm that will switch its brokerage from Advisor Group's SagePoint Financial to Osaic in September — has topped 100 financial advisors and $6.5 billion in client assets after launching the RIA with only 13 with around $100 million in 2019, according to Chief Operating Officer Jesse Kurrasch. 

Rather than using the traditional M&A deals that are driving much of the industry's expansion, AmeriFlex is recruiting independent teams attracted to succession plans with no change in equity upfront and proprietary planning software offered by the branch, he said.

"There seems to be big interest in the industry in firms that do more than just provide a back- office role," Kurrasch said in an interview. "It's a culmination of all these different pieces and, on top of that, there's also the opportunity to be an owner in the Ameriflex RIA."

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Wealth management firms are enlarging their footprints through multiple methods reflected in AmeriFlex's June 27 announcement and four others this week. Savant Wealth Management;  Crestwood Advisor Group, a Focus Financial Partners-owned RIA; and Procyon Partners, an RIA that uses the Dynasty Financial Partners platform, each unveiled significant deals. On the advisor recruiting trail, independent brokerage Arkadios Capital picked up two teams from rivals with a combined $400 million in client assets. Organic growth from attracting new clients or additional assets from existing ones represents the third primary form of RIA growth.

Since 2018, Long Beach, California-based RIA Halbert Hargrove has reached its annual target of boosting the count of client households by a net 10%, according to CEO JC Abusaid. At 46 employees, including nearly 20 advisors managing $3 billion in client assets on behalf of about 800 families, the firm has achieved substantial scale. Halbert Hargrove did so, though, without any M&A deals in the past or any plans to pursue a deal in the future, Abusaid noted in an interview. He added the caveat that the firm won't reject any opportunities out of hand.

"Every year we broke our prior record in terms of growth," Abusaid said. "That's when we determined, if we could grow organically at that rate, why would we do M&A? Why would we put at risk who we are and our culture?"

AmeriFlex bills itself as the "The Home for Hybrids," referring to advisors dually registered with brokerages and outside RIAs. Advisor Tom Goodson, who co-founded a networking and referral group for women in the industry called the W Source alongside fellow AmeriFlex planner Hannah Buschbom, is the CEO of the firm. Unlike many rapidly growing firms, AmeriFlex hasn't received any capital influx from private equity firms or other external investors. 

The firm also has a pending application to FINRA to register AmeriFlex Group Securities as a brokerage "solely for the purpose of receiving commission compensation generated by SagePoint brokerage activities," according to the RIA's Form ADV brochure with the Securities and Exchange Commission.

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Advisor Group rebranding to Osaic

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The firm calls its planning software "AmeriFlex Premier+" and its succession planning services "SuccessionFlex." The latter business line started in 2021, with the firm giving advisors who agree to stay with the firm the option of selling 30% to 40% of their practice's revenue to the branch or another affiliated planner and no ownership changing hands until their retirement. 

A dozen advisors have received a combined $9.4 million through the program so far, and more than 75 of those at the branch have received stock in the firm's RIA. One day, AmeriFlex is seeking to more than triple its current size and get to about 315 advisors with $25 billion in client assets and a presence in "all the big cities in the U.S.," according to Kurrasch.

"We're thinking of them as pillar partners in pillar cities supporting our succession partners program across the country," he said.