AdvisorBid may be well on its way to becoming, in a smaller version, the Facebook of wealth management.
AdvisorBid is a free online marketplace in the U.S. for financial advisors looking to transition to another firm, to find a succession plan or to bid on books for sale.
It launched two years ago and now has 1,300 active advisors and 90 companies – which includes broker-dealers, RIAs, OSJs, hybrids, insurance, tech providers, variable annuities, alternative investments and family offices – signed up.
“Our goal is to map out an entire organizational chart of every opportunity for advisors and their clients,” Brandon Spottswood, founder and CEO of AdvisorBid, told ThinkAdvisor. “We’ve had some advisors tell us we’re the next Facebook of wealth.”
Prior to AdvisorBid, there was “no true marketplace” for advisors, according to Spottswood, who worked as a recruiter at NEXT Financial, an independent broker dealer, and as director of business development at Cambridge Advisors before launching AdvisorBid.
Advisors had to call companies one at a time and fill out “mountains of proprietary paperwork” just to find out what the selling agreements were or to see the portability of their business.
“It’s so archaic,” Spottswood said. “We’re in the 21st century here, yet there was no marketplace for advisors.”
With AdvisorBid, though, Spottswood and team have mapped out a way for everyone to do their preliminary due diligence process on one another without ever having to pick up the phone.
Advisors can fill out a profile in “less than 10 minutes,” according to Spottswood, which includes what broker-dealer affiliation they have and breaks down their book of business.
From there, AdvisorBid is able to provide a compatibility score based on the advisor’s profile.
“We can say that ‘of all the broker-dealers and recruiting companies signed up, this is how much of your business will be compatible with this new network,’” Spottswood said.
Or, if it’s not compatible with a certain company, AdvisorBid can tell you what items in an advisor’s book of business may be lacking so that there can be a solution for those items.
On the other side of things, recruiting companies will get notifications of which advisors want offers from them.
“It allows the recruiter to go into this recruiter dashboard on our system and see all the advisors that have requested an offer from that company in chronological order,” Spottswood explained.
The recruiting companies will be able to see these advisors’ entire profile, including their state licensure, breakdown of their book of business, their designations, their FINRA BrokerCheck, their investment philosophy, and their social media links.
AdvisorBid also protects user anonymity during a transition.
“If someone’s looking to leave LPL or Cetera or Securities America, they don’t want their compliance knowing, they don’t want their OSJ knowing that they’re looking to leave and they need to have anonymity,” Spottswood said.
Since launching, AdvisorBid has had 32 successful transitions and moved nearly a billion dollars of assets.
Spottswood predicts that hundreds of companies will be signed up to the site by the end of the year and thousands by the end of next year.
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