A New Paradigm?

SEI Investments has taken the next step in its plan to prepare the advisory profession for the future by rolling out the SEI Wealth Network, a business model for independent advisors designed to address the financial and life planning needs of high-net-worth individuals by providing holistic services, especially to baby boomer clients. Based on the instincts and insights of founder Al West Jr. and using homegrown studies and reports from research firms like Sprectrem, the Wealth Network uses a franchise approach registered with the FTC that Jack May of SEI hopes will include some 200 advisory firms over the next four to five years. So far, SEI has signed up four advisory firms. While details of the program and the business thinking behind it is complex (a more comprehensive report will appear in the June issue of Investment Advisor), the bare bones of the program are these: SEI will place these franchises in geographically disparate “wealth centers” around the country–the first two, which are owned by SEI and serve as “labs” for the concept, are in Boston and suburban Philadephia. These will be already successful advisory firms that meet SEI’s standards, agree to cobrand themselves with the SEI name, and adopt a systematic approach to serving those HNW clients. The Network approach includes everything from systematizing the referral process and “discovery” of the client’s needs, using an existing SEI “goals-based” planning approach, to calling on a host of experts in specific planning areas, to even the physical layout of the franchisee’s offices. The franchisees will sign five-year agreements and will pay annual fees to SEI for marketing, advertising, the referral system, and SEI’s proprietary technology platform called Desktop.