A newly independent team has left UBS Financial Services and joined one of LPL Financial’s offices of supervisory jurisdiction, Gladstone Wealth Partners.
The 10-person practice, rebranded as Puzzle Wealth Solutions, is led by CEO John Klaas and COO David Millington. Based in Schaumburg, Ill., Puzzle has approximately $1.2 billion advisory and brokerage assets.
Puzzle’s addition is just the latest recruiting victory for Gladstone and its CEO, Richard Frick. Based out of Chester, N.J., the OSJ brought in 34 teams in 2020 after a merger with Financial Resources Group Investment Services made it into a formidable enterprise by revenue and assets on LPL’s corporate RIA. This year, Gladstone has signed on 31 practices as of last week, Frick says.
During the pandemic, Klaas says his team realized they were being slowed down by branch system, prompting them to explore other alternatives.
He says they considered starting an independent RIA but decided to join an existing wirehouse to help deal with supervisory, compliance and administrative issues.
“With the support of LPL and Gladstone, we're able to solve every single problem for our clients. We have some very sophisticated issues that I believe the wirehouses thought there was no way we could solve them, but Gladstone was amazing at rooting out the core issues and plugging in the right people,” Klaas says.
He started in the industry in 1988 as a solo practitioner. He joined Morgan Stanley in 1990 and switched to UBS in 2007.
Although Klass says he has nothing but respect for UBS, he notes that there was a lot of “bloat” and “excess” at the wirehouse, stating this move allows him and his team a more direct route to solve its their client’s’ problems.
A UBS spokesperson declined to comment on the team’s departure at this time.
Klaas says he chose Gladstone and LPL over other custodians due to their flexibility and collaborative nature.
“We've got a partner in Gladstone. That’s a kindred spirit in terms of let's grow and let's solve problems. They take care of the things that I am not an expert at, and they do it well. And they allow me to go solve my clients’ problems,” he says.
Frick says that many advisors are looking to go independent, commenting that the wirehouse model is broken.
“We're growing and we've put structure around the independent model to support large teams who want to break away. That's what's kind of important. They don't have to take the risk to launch on their own. They can affiliate with us and let us do all the entrepreneurial stuff that they don't need to do on their own,” he says.
Brandon Kawal of Advisor Growth Strategies says Puzzle’s move to Gladstone is just another example of the continuing trend of teams leaving the larger wirehouses to go independent with the help of already existing branches.
“Over the last several years, there's been more and more teams continuing to go independent but choosing to not necessarily do it all themselves and work with a supported platform,” Kawal says.
Historically, he says bigger teams had constraints or limitations about going fully independent, including the complexity of clients or services they needed. But that’s changing: The independent model now has enough resources to accommodate any type of client with any type of service they would be looking for, giving advisors greater confidence about leaving, he says.
Puzzle will use Gladstone’s hybrid RIA rather than LPL’s corporate RIA. Klass says that option is more appealing than being part of a corporate platform.
“We're there to help support [teams], whether it's marketing, compliance, commissions,” says Frick. “They get all of our services that we provide to all of our advisors, so they don't have to do it all on their own."
