A $17-billion RIA doubles down on a social media strategy that netted it 50 Facebook employees

Super bloggers with real street cred are the missing ingredient for casting a Web net

Thursday 1.10.13 by Lisa Shidler

Brooke’s Note: I’m a huge skeptic of social media strategies. See: Early adopters of social media, RIAs are growing disenchanted with its power to drum up new business. But this one seems to be showing results. I think an obvious reason it’s working is because it’s about people with quality ideas at its core. In short, BAM Alliance hires bloggers with killer Google page ratings who get found by the smart set that do independent research on the web. If these smart people are then affiliated with an RIA and that information flows through social media — then a virtuous cycle is created.

Buckingham Asset Management LLC is doubling down on the marketing approach that’s already helped it nab 50 flush Facebook clients. See: Why sudden wealth at Facebook is gushing into a $17-billion RIA and triggered a merger of two DFA giants.

The St. Louis-based firm with an office in Silicon Valley recently announced that it had brought aboard bestselling author and financial blogger Dan Solin as part of the BAM Alliance, the overall group that includes both Buckingham’s TAMP and RIA. Solin is known for writing the “Smartest” series of books including “The Smartest Investment Book You’ll Ever Read” and “The Smartest 401(k) Book You’ll Ever Read.” He also writes a weekly blog for The Huffington Post and U.S. News and World Report.

One growth strategy of Focus Financial Partners”:http://www.riabiz.com/d/5393476 largest RIA has been to bring over media darlings who have access to tens of thousands of affluent investors through national blogs and websites — that Google loves. See: Gathering assets with long tails: Exactly how RIAs of any size can market with the big boys with 'Google Love’.

As a bonus, Buckingham’s outreach team networks with its current clients. See: Buckingham Asset Management creates a structure with Focus Financial that enables it to roll-up the 120 RIAs that entrust it with $13 billion of DFA TAMP assets.

Three blogging amigos

A year ago, the firm brought on author and blogger Carl Richards. Already on board was Buckingham principal Larry Swedroe, who writes a blog for CBSnews.com and has penned more than a dozen books including, “Think, Act, and Invest Like Warren Buffett: The Winning Strategy to Help You Achieve Your Financial and Life Goals.” See: RIA items of interest: Mag Black-Scott expands beyond Beverly Hills and BAM adds an advisor who contributes to The New York Times.

“Between the three of us, our access to digital marketplace is pretty broad,” Solin says. “The digital marketplace is the great leveler. It doesn’t take a lot of money to write a blog. The three of us are blogging so broadly, and between the three of us we’ve written more than 20 books and we’re all conveying the same message — that there’s a better and more responsible way to invest.”

Golden ticket

Buckingham CEO Adam Birenbaum says these media stars help the firm lure big clients and that it couldn’t have carved out its niche among Facebook employees if it hadn’t been for the national media presence that allowed those prized prospective clients to learn about the RIA through Internet searches. See: How RIAs can maximize their web marketing with nary a 'friend-ing’ or tweet.

Dan Solin: Between the three of us, our access to digital marketplace is pretty broad.
Dan Solin: Between the three of
us, our access to digital marketplace
is pretty broad.

The BAM Alliance has more than $17 billion in assets, having added more than $5 billion in the last two years alone.

“We don’t think it’s happening anywhere else. We wouldn’t have had the Facebook opportunity if it weren’t for Larry Swedroe spreading our message,” Birenbaum says. “We can’t compete with the wirehouses’ brand because they have unlimited funds in that area, but we can compete against them with our own educators, who are basically spokespeople for the movement we’re trying to develop.”

Third-party credibility

Advisors who have national blog posts on well-respected websites can observe results immediately, says Joe Anthony, senior vice president at public relations firm Gregory FCA Communications. Using a tool such as Google Analytics on an RIA’s site will typically show spikes when an advisor is featured in a national site or appears on television.

“The secondary peaks are often the days when the article or video is promoted on their blog/website after it runs,” he says. “The clients see the tangible evidence of the power of a real media presence. Better yet, they see that more people are taking the time to visit their website to see what they are about.”

Anthony points out that what is important about getting publicity on business news websites such as that of The Wall Street Journal is that they help RIAs gain authority.

“In the RIA world, what is often lost is the fact that the aura of 'third-party credibility’ — being seen as credible authority by a respected source — cannot be replicated or conferred by your own blog or Facebook page alone. That is still best accomplished by real media coverage, with things like social media and blogging to support/amplify that,” he adds.

Joe Anthony: Being seen as credible authority by a respected source ... cannot be replicated or conferred by your own blog or Facebook page.
Joe Anthony: Being seen as credible
authority by a respected source …
cannot be replicated or conferred by
your own blog or Facebook page.

Zero to 50 in 12

Buckingham went from having no Facebook clients a year ago to having 50 currently, and the Silicon Valley influx helped Buckingham close its merger with Cupertino, Calif.-based RIA Founders Financial Network LLC. See: Could engineers be the answer to the RIA talent shortage?.

Birenbaum hopes this media strategy will draw more ultrawealthy Silicon Valley clients to the firm. They appreciate hearing from national thought leaders, says Joe Goldberg, director of business development and a principal at Buckingham.

“They like knowing that we’re expanding our reach. There are few voices that have as broad of appeal as Larry Swedroe, Carl Richards and Dan Solin. We’re trying to corner the market with these three great guys.”

How Facebook clients are feeling now

It’s been a roller coaster ride for the firm’s Facebook clients since the social media site’s April IPO. The stock price started out at $38 a share and most Facebook employees had to wait at least six months before they could sell. By then the price had fallen to about $22 a share. The stock has since risen to $31 a share. See: RIABiz’ 10 most-read stories of 2012: What fascinated you and why.

Some of the Facebook clients wanted to cash out all of their stock after six months and others chose to cash out only parts of it. “Some of them sold to pay off debt and buy a house, and kept some positions.” Goldberg says. “The people who sold everything would have had at least 30% more if they waited.”

Joe Goldberg: I can tell you that all of the [Facebook] clients who sold everything don't have any regrets.
Joe Goldberg: I can tell you
that all of the [Facebook] clients
who sold everything don’t have any

Even so, he emphasizes that none of the Facebook clients who sold their stock came out losers. They were, after all realizing a huge amount of money any way you looked at it.

“It’s amazing because there were some people who sold shares as quickly as they could and others who have waited,” Goldberg says. “I can’t put myself in their shoes today, but can tell you that all of the clients who sold everything don’t have any regrets.”

Wealth being created

Goldberg says many of Buckingham’s Facebook clients are already leaving for other start-ups. In order to attract more Silicon Valley prospects, Buckingham is holding seminars at its Cupertino office about every four to six weeks.

“We feel there is significant opportunity with all of the wealth being created to increase our presence there,” Goldberg says. “About 25% of the clients we were working with have already left and gone to another start-up. The rest are waiting for one of their last vesting dates and they’ll go somewhere else. Who knows where the next company will be with a liquidity opportunity. We hope we can continue the momentum we’ve built with the current Facebook clients.” See: 19-advisor firm in Santa Monica jumps to LPL with social media-fueled strategy for the underserved under-40 set.

Adam Birenbaum | Larry Swedroe | Dan Solin | Joe Anthony | Joe Goldberg

Buckingham Asset Management | Focus Financial