HighTower Advisors and United Capital seek to stamp out wirehouse feel by embracing Apple technology

Wirehouse brokers break away to independence to escape the oppression of tight compliance codes, narrow product choices, strict sales goals and a corporate attitude.

Symbolic of the burden to some of them, especially those who use Macs in everyday life, is the PC computing environment that wirehouses use.

Elite venture-backed aggregators like HighTower Advisors and United Capital whose business is to lure big brokers to independence, are looking for every edge possible in making their platforms distinct from these legacy Wall Street brokers. Increasingly they are enlisting Apple Inc.’s aid to do so.

HighTower Advisors, which raised $100 million this winter from venture capitalists, announced this week that it will make its technology platform, HOST, available on iPhone and iPad. Matt Camden, chief technology officer for HighTower is overseeing the Apple embrace.

Not a faddish whim

This move by the Chicago-based serial buyer of brokerage teams isn’t a staggering technological development, but it’s also not motivated by faddish whim brought on by the launch of a buzzed-out tech gadget, according to Elliot Weissbluth, CEO of HighTower in Chicago. Rather, it’s a sign for brokers that HighTower is future-looking and flexible.

“If you want to be relevant in the next 10 years, ignoring Apple is a significant risk,” he says.

Weissbluth has yet to get an iPad himself but says that he plans to.

“We wouldn’t have invested the time and money” if it weren’t a core technology issue, he says. “We made a decision [to embrace Apple] early on. This is much more than paying lip service.”

Giving advisors the option to use Apple products is viewed as imperative at HighTower, whose subsidiary firms manage about $16 billion of assets. About 50% of HighTower’s executives and advisors use iPhones and some advisors are using the iPad, Weissbluth says.

Grayer wirehouse realm

HighTower competitor, Newport Beach, Calif.-based United Capital, also wants to be certain its partner firms don’t confuse life in the RIA world with life back in the grayer wirehouse realm.

“We don’t want people to come to United Capital and say: I feel like I’m on the mother ship,” says Brandon Gage, senior vice president of technology at United Capital. The firm’s back end technology supports Apple.

Weissbluth says he had a similar awakening when he realized that HighTower advisors were using PCs at work then slipping into the comfort of their Mac when they got home.

“We said: go ahead and bring [your Mac] to the office,” he says. “Some of them have abandoned the PC altogether.”

The iPad came into sharper focus for these executives on Saturday, when Apple released its iPad 3G, which ranges in price from $629 to $829 and costs about $30 per month for unlimited 3G data transfer. The difference between the iPad 3G and the iPad that was released about a month ago is that the 3G version accesses the cell phone spectrum and the original iPad is only good with wi-fi connections. See: Bill Winterberg outlined the potential benefits and shortcomings of the Apple iPad for advisors

Several weekend acquisitions of 3G

Gage says that several employees and advisors of United Capital acquired the 3G version over the weekend.

The benefits of using the iPad are fast becoming apparent to advisors at United Capital, according to Gage. United Capital’s 25 advisory offices oversee more than $10 billion of assets, including $4 billion of assets under management.

“We can actually sit down with the client and do real-time what-if scenarios in their homes or a coffee shop,” he says.

By leveraging the iPad and iPhone’s 3G network services, advisors can effectively break Wi-Fi dependence. This isn’t a feature specific to Apple, however. Many devices have similar capabilities, and 3G internet service can be added to most laptops with an accessory.

Not everyone sees the shift to Apple as an imperative for financial advisors.

Joel Bruckenstein, publisher of Virtual Office News of Miramar, Fla, does agree that advisors failing to pay attention to the rise of Apple technology hazard falling out of step with their clientele.

“I would agree that there is a significant risk in ignoring Apple products because at least a portion of an advisor’s client base is using a Mac, or an iPad, or an iPhone to access the advisor’s website whether the advisor realizes it or not,” he says.

Yet for all the excitement about apple technology, Bruckenstein questions whether an advisory firm needs to anguish over a wholesale change to a Mac environment.

A little strong

“Does that mean there is a ‘significant business risk’ not going to a Mac environment? ,” he asks. “That might be a little strong. I think advisors need to be aware of Apple products. If your clients are using them, you have to cater to your clients.”

But Gage says that some United Capital advisors are strongly considering the all-Mac move in the next two months. That advisory firm’s computer equipment is obsolete because of age and so it is considering replacing all of its PC with Macs.