On Monday, RIABiz ran a list of the top 20 RIABiz articles in 2010. People enjoyed knowing what our readers were most interested in from a group of about 600 articles for the year. The next question for me was what our next 20 articles (21-40) would reveal about the business of registered investment advisors.
One article that appeared high up on this second tranche of headlines, “What to make of Mark Hurley’s latest prophesy that most RIA firms will go out with a whimper,” didn’t fit any of the neat categories I was assigning to the stories.
But I believe it may best capture the broader theme that seems to be running through all of these articles. It covers a report Hurley wrote about whether or not an RIA practice has value as an organization. By concluding that a tiny handful of firms achieve 'enterprise value’, he touches a nerve. The RIA business is one that is rapidly seeking ways to achieve enterprise value both for practitioners — and increasingly — investors.
Mass production of value
Four of these top articles related to major happenings in technology — an area where tremendous value can still be added to an industry trying to shed its mom-and-pop cocoon. Another four articles related directly to breakaway advisors and the roll-ups that are helping to mass-produce the value-adding process of molding a broker into a private wealth manager.
Another four articles relate to the opportunity for RIAs to demolish the competition in the 401(k) business — a veritable green pasture of self-renewing assets. This is a complicated subject that has invited controversy at RIABiz. What can not be argued is that RIAs smell blood as the DOL raises standards to places where brokers could have a difficult time following.
Another way that RIAs seek value is by choosing partners that take work off their plates and service their clients with big-company competency. There are two articles here that bring to light the success of little-known asset custodians, Trust Company of America and BNY Mellon, that fit that category. Articles with DFA, SEI Investments, Genworth Financial Wealth Management and Envestnet in the headlines also fit this broad category of partner firms.
A way that advisors seek to upgrade their own value in terms of knowledge and connections is to attend conferences. Timothy Welsh and Sondra Harris combined forces to write 2011’s most well-read conference summary with their detailed and authoritative account of what they saw at Schwab IMPACT 2010.
Exclusive conferences, Next Big Thing
Close behind were two articles I wrote about smaller, more exclusive conferences produced by Schwab and Fidelity for some of their more elite RIAs. Thanks to Alison Wertheim of Schwab and Steve Austin of Fidelity for their help in giving me a window into these events.
The list also yielded an oddball success. RIABiz sees itself foremost as a publication covering the business of the business of advice provided with fiduciary care. We run some investment- and market-related articles because they have a bearing on the RIA business. One such article that did well: A style for all markets: momentum investing.
It also produced an articles about Dynasty Financial Partners and Hightower Advisors. People ask me frequently what I think will be the Next Big Thing in the RIA world. I don’t know for sure. But I am certain that both these companies have lured A-level talent from Wall Street and have formed intelligent ventures around these people. They should at least be on people’s watch lists.