Last June, when the financially troubled Brookstreet Securities Corp. collapsed, some 500 advisors were instantly out of work. Behind the scenes, recruiter Larry Papike was helping many of them recover and regroup.
Larry Papike, President; Cross-Search; Jamul, Calif.
On his workday: “There’s a sizzle. You never know from one day to the next what’s going to happen when you walk in that door.”
Sound Bite: “I think the biggest thing about him is that he’s a people person. He establishes personal relationships that are ethical and honest and that comes across. People know they’re going to be taken care of.” — Jodie Papike on her dad/business associate
“I can’t tell you the pain I feel when you have a broker going along fat, dumb and happy and suddenly you get an e-mail saying: ‘Stop. You’re out of business.’ I had my whole staff working all weekend to help as many as we can,” says Papike, who heads Cross-Search, a Southern California-based recruiting firm that specializes in the independent broker-dealer sector. “It was awful. Some of these people lost up to $80,000 in their last commissions.”
That Papike, 58, approaches his job from a humanistic perspective is not surprising when you consider his own career arc. As a former founding executive with Sentra Securities, Papike ran every department of the firm, helping it grow from a single registered rep in 1981 to 410 in 1989. Shortly after the sale of Sentra to a life insurance company in 1989, the entire senior staff was fired.
“To this day, I’ve never figured it out,” says Papike. “It’s where part of my passion comes from. I know what it’s like to be on the street.”
It wasn’t long before Papike regrouped, forming Cross-Search in late 1989. Since then, the firm has placed nearly 1,000 brokers with 51 firms, along with filling 71 executive positions. As one of the senior recruiters in the channel, Papike has observed huge change in the independent contractor marketplace — much of it recent.
Up until a few years ago, according to Papike, the independents could not compete with wirehouses or regionals on technology — or basics like research, consolidated statements and online trading. “We could not provide the things wirehouses could supply,” he says. “We were second-class citizens.” Not so, today.
“Look at Raymond James or LPL and I’ll stack them up against Morgan Stanley or Merrill Lynch any day,” Papike adds. “Once advisors began to recognize the advances that had been made — not only in technology but in products and services — my phone, and everybody else’s, began ringing off the hook.”
In recent years, Papike reports, there’s been a “tremendous” flow from wirehouses and captive insurance agents. Not surprisingly, Wachovia Securities’ purchase of A.G. Edwards has given a new boost to the marketplace.