Questions and answers with Stifel’s new independent B / D boss


    Stifel Financial dusts off its independent broker / dealer Century Securities, which the company has operated for 30 years, and brings on Alex David, former director of branding and marketing at Wells Fargo Advisors Financial Network, as the new president and CEO of the business. It will be renamed Stifel Independent Advisors.

    Aside from Century, Stifel has some history in the independent brokerage business. The company acquired Sterne Agee in 2015, but only one year after that deal closed, it sold the company’s independent B / D, clearing and RIA businesses to INTL FCStone, a commodities and forex broker.

    However, David has the mandate of Stifel Chairman and CEO Ron Kruszewski to grow the business and recruit consultants, which will be his top priority. Century currently has around 93 consultants. At the end of the fourth quarter, Stifel had around 2,200 consultants in its employee channel and managed client assets of around 357 billion US dollars. David believes the company has an advantage in bringing two different models to market – one for employees and one for independent contractors, a go-to-market strategy that has evolved at Wells Fargo.

    David recently spoke to about his plans for IBD: What is the motivation for renaming Century and getting you to run this business?

    Alex David: When Ron Kruszewski, our Chairman and CEO, and I started talking, one of the things he said was, “Alex, we have, if you will, the bones of an independent. We have an independent one, we’ve had it for 30 years. It’s called Century Securities. And we have rock stars in the home office who support our consultants. We have really good advisors out there, but we really didn’t pay that much attention. We did all these other things to the retail group even though we had that on the side, and we just didn’t do anything with it. “

    The way he described it was, “We have this Corvette and it’s in the garage and we just have to take it out and tune it and go from there.” Stifel has a very, very strong name in the market among consultants, and we have to use that. And so we will rename the business Stifel Independent Advisors. Why is the company focusing on this business now?

    AD: If we look at some of these larger teams that move in the industry, some of them don’t necessarily go back to an employee model, but rather to the independent space. And we want to make sure we play in this room. We’re great as nationwide, and now we’re great as independents. Now we can understand both. What type of advisors do you target?

    AD: Our goal will be the wirehouse consultants. It is this highly qualified consultant who has the desire to continue delivering the same products and services that he is used to, but only has more flexibility and more local control. With that said, we also realize that there are some really good independent consultants out there who fit into the same shape, and we’d love to have them too. Do these advisors have the name Stifel on their door?

    AD: Many of them are already some kind of private label or custom brand, so this is likely to have minimal impact on these consultants, other than disclosures. But for those who are currently branding Century, they now have the option to brand Stifel. What changes in service and support do you plan for the unit?

    AD: I don’t think I need to do a major overhaul at all. The only thing I add myself is the growth area. We have a number of independent practices aimed at growing your business not only organically, from client to client, but also by buying business books and adding advisors to your mix. So we really didn’t have a proactive way to help them open up new practices and guide counselors into their practice. That’s one thing I see we’re moving forward in terms of business development. Can you explain what that might look like?

    AD: I think the first task is to develop independent consultants for life, ie practice by practice, recruiting from the full-service companies and helping these consultants open their own practice. That is the number one priority. But what I also found are many of the existing consultants who have their own practices and actually have an interest in developing themselves. So it’s this kind of “coaching” that helps them recruit into their practices, help them buy practices, this kind of bifurcated model that we can develop in the area of ​​business development. We ensure we have the business development resources to introduce new practices and then help advisors who choose not to start their own practice to join an existing practice. Have you considered launching an offer for fee-only registered investment advisors?

    AD: At this point, we won’t be offering a paid RIA or hybrid RIA. We believe we have tremendous opportunities in the independent consultant space. I’m going to say how Ron looks at the entire industry, he’s always monitoring what’s going on and who knows what this will be like in the future. Do you have any recruiting goals for the independent company?

    AD: We don’t. We are well capitalized; We have the capital Stifel at our disposal to make strategic decisions and transitions. And Ron’s ultimate goal is to bring in quality consultants. He didn’t say, “Achieve 10 by first year”; It’s just a matter of calling in quality consultants one after the other. When you talk about the capital you have, do you think about possible acquisitions?

    AD: Not for acquiring full B / Ds, but if we have consultants on board we will use funds for transitional aid.

    What’s interesting in this room, in the independent space, is probably the only thing that is taken for granted. Being able to have access to capital to help some of these teams and some of these bigger teams make the move and make sure they can do well and then really compete is easier said than done. But the fact that Stifel supports us and the balance sheet of a well capitalized company makes it a little easier than most people think. What do you bring with you in terms of your experience?

    AD: One of the things that I hope to bring to the table is my experience working with the regional leadership of the employee model and the joint launch. We now have two offers. We have the employee model and we have the independent one. And that’s exactly what I’ve been doing for over a decade to go to market together, and it’s been hugely successful for both of them. Aside from business development, is there anything else this unit will share with the Employee Channel?

    AD: The entire model is based on the use of the existing employees. So we have a small team that works with an IBD, but the products and services as well as the back office and middle office are already in place and we will use that.

    This has been edited for length and clarity.


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