United Capital Adds 23-Member Wealth Management Team

A Denver-based wealth management firm with $2 billion in AUM happily casts it lot with United Capital

Jason Rosener, managing director, United Capital. Former principal, Capital Investment Counsel. Jason Rosener, managing director, United Capital. Former principal, Capital Investment Counsel.

It was about 18 months ago that the principals at Denver-based Capital Investment Counsel were faced with a conundrum about the future of their wealth management firm.

Founded in 1990 by refugees from Shearson Lehman who had “seen the RIA light,” in the words of one of those principals, Jason Rosener, CIC had been acquired by Compass Bank (in 2007) which was itself acquired six months later by the Spanish-based bank BBVA. As a subsidiary of the bank, the RIA had grown into a large wealth management firm with AUM of $2 billion and an average client household with $1.3 million in investable assets. Despite the growth, being part of 50,000-employee BBVA was not entirely pleasant, Rosener recalled in an interview Wednesday, citing issues with "getting on the budget," for instance. 

Then BBVA said it was getting out of the wealth management business.

So CIC’s principals spoke with a “half dozen” potential suitors before finding their match in United Capital, which announced today that 23 former CIC employees, including the four principals, had agreed to become employees of United Capital, the largest-ever onboarding by the advisor partnership firm.

Why United Capital? “This was the only firm that came to us with a clear vision,” Rosener said, not only for what United Capital could “do for us, but what we could do for United Capital.

“We were looking for a new partner with aligned interests,” which Rosener said they found in United Capital.

“Our situation was unique, doesn’t everybody say that?” joked Rosener. “We weren’t looking for a payday or a way out,” but rather wanted to join “a single RIA offering clients objective guidance on an open-architecture platform to help us grow and serve our clients.” United Capital, he says, was “the only firm that came to us saying this is how both of us will be successful.”

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Editor's Note: A BBVA spokesperson commented on this story: BBVA Compass never exited or ever desired to exit the wealth management segment. BBVA Compass is committed to serving all segments in its communities, including wealth. We remain fully committed to all our communities and customers. Any statement to the contrary is simply incorrect.

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Rosener said he and the other CIC principals “view ourselves as more of a wealth management firm,” while seeing United Capital as “more of a life management firm,” citing UC tools like its Guidebook and Honest Conversations, but with the shared commitment to “always do right by the client.” Moreover, the principals were attracted to United Capital’s support to continue its goal “to grow reasonably,” and while CIC had some partnerships, like with Schwab, United Capital had more on both the custodial side and on the technology side. 

“This is not an exit strategy for anyone” at CIC, Rosener said, noting that several of the principals are relatively young for advisors. They see United Capital as “a final resting place, but in a positive way. We believe in UCC, we want to help them grow.” Rosener’s convinced that United Capital will “continue to be innovative; they’re change makers in our industry. There are other aggregators, but we’re one company, one ADV working to improve our clients’ well-being,” not just financially but in “life management,” the area of clients’ lives where money and clients’ life goals intersect. 

In addition to the four principals joining United Capital as managing directors — Stephen Dreiling, CFP; Rosener, CFP; Chris Johnson, CFP; and Brian McDowell, CFA — 19 other advisors and operational staff have become employees of United Capital. Since joining United Capital, said Rosener, four new employees have been hired: one to “put boots on the ground” in a new office in Tucson, Arizona, and three others who will help expand its Scottsdale, Arizona office. United Capital, the Newport Beach, California-based firm, said the CIC deal brings the total number of offices in its partnership to 59. Each new hire from CIC, United Capital said, is being compensated via cash and/or equity in United Capital. 

'Every Option' Was on the Table 

Matt Brinker, senior VP for Partner Development and Acquisitions at United Capital, said in a separate interview that unlike most other RIA firms, CIC “had every option on the table — starting an RIA, getting massive checks from a wirehouse, or joining a partnership.” But Brinker said that Rosener’s comments on the value of the United Capital partnership is “consistent with every partnership we’ve done.” United Capital “brings to bear platform, technology, the infrastructure and operational scale” to the point that “one and one makes three.”

Brinker said “We’re doing north of $100 million in revenue,” and has about $13 billion in AUM, but “especially in light of the landscape shifting — the robo-advisor, the custodians moving more into the retail space, Vanguard’s robo-advisor — every one of our partners has validated that what got them to this point won’t get them to the next.” He argues that United Capital’s ability to “invest in this national RIA from a branding, platform and technology” standpoint is “widening the gap between what a standalone $500 million wealth manager will be able to do on its own.”

Brinker says as well that “it’s not by accident that the average age of our partners is 46; they have 20-year runways, and they’re keenly aware that the playing field is changing.” In addition, “the common theme that we’re hearing” from advisors is “if I had $10 million and not a business to run, this is what I would build. Money and time are their constraints — we’ve built it for them.” 

Obliquely referring to the same innovative culture mentioned by Rosener, Brinker said “our platform is evolving” to help meet the needs of younger clients as well.

Brinker also emphasized the importance of United Capital’s culture. “We’re majority-owned by employees, so our partners maintain an equity interest in the business, get to shape the client experience and influence who and what we do as an organization.” Yes, “our partners are W2 employees of the organization, but if you ask any of them if they feel like their employees, you’ll hear a resounding ‘No!’ We own 100% of the businesses that are within our RIA — one RIA, one ADV — and we now have 400-plus employees throughout the country, 30 people in Newport Beach. We give the keys to run United Capital in a region or location” suited for growth.

But these are RIAs, who are notoriously independent business people. Brinker agrees that independence is “the biggest hurdle for many folks, until they talk to our partners, who confirm this is an environment where they get to collaborate with like-minded advisors, to a common goal—growing United Capital.” 

Rosener believes the advisor industry will “continue to consolidate,” noting in particular that “with our regulatory environment, it’s tough to make the jump from $250 [million in AUM] to $500 to $1 billion. It’s a complex industry that’s unpredictable.”

But being part of a firm that “brings innovation and leverage resources — they have a great deal of investment professionals across the board and across the country. We’ve always thought we’ve had a great bench, with a CPA, but what’s better than having 10 CPAs?” It all comes back, he says, “to benefiting the client.”

--- Check out Cambridge’s Continuity Partners Group Welcomes First RIA on ThinkAdvisor.

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