National Financial Partners, founded in 1999 and headed since then by Chairman, President and CEO Jessica Bibliowicz, came to prominence as the first of the new breed of rollup firms of advisory practices. By going public in 2003, NFP has gone further than most such rollup firms, for whom a public offering is still just a glimmer, even if becoming a public company has been a bit of a roller coaster ride for NFP, its affiliated firms and all its shareholders. (Bibliowicz is also a member of the AdvisorOne Top Women in Wealth for 2010, and was profiled by Investment Advisor’s Melanie Waddell way back in 2001.)
But according to James Poer (left), who became president of the independent broker-dealer arm of NFP—NFP Securities—in 2008, over the past two to three years NFP Securities has quietly changed its focus in addition to its name regarding how it wants to interact with advisors of all kinds, and beginning now it will no longer be quiet.
NFP Securities, now known as NFP Advisor Services Group, “was in the background, a support business for the sister companies in the NFP family,” said Poer in a Monday interview. “In the darkest hours of the financial crisis,” Poer recalls, “we made a significant investment in independent financial advice, in our broker-dealer, because we believe in the independent model.” The first step in that evolution was changing its name: “We thought ‘Securities’ didn’t fit,” he said, because that word “means BD; it means transaction.” As NFP Advisor Services Group, the company is trumpeting that “We’re a financial services company that serves the high-end financial advisor so they can serve their clients.”
The second step was to make significant investments in technology, in what Poer calls “multiple chasses that serve more than one channel.” While NFP Securities’ traditional approach of serving independent registered reps and IAR reps of the NFP corporate RIA remains a “vibrant part of our business that will continue,” NFP Advisor Services now welcomes as well those reps that have their own RIAs, Poer says, and dual registrants who “want to bring all their client data and their own compensation data “into one workstation.”
The third step in NFP Advisor Services’ evolution was to make “significant investments” not just in its technology, but in “talent, process and service” to support those advisors in the independent and dually registered space, which he argues is still “very fragmented.”
The final step, he says, is about “getting our message to the market” through stepped-up advertising, recruiting and
roadshows designed to showcase NFP’s definition of independence and what it believes is its “very sound, unique” proposition to the advisor universe.
In 2010’s Q4, the Advisor Services Group (ASG) contributed significantly to NFP’s revenue and bottom line. Q4 revenue of $58.9 million for ASG comprised 20.7% of total NFP revenue and was up 23% over 2009’s fourth quarter. ASG’s adjusted EBITDA for the quarter ended Dec. 31, 2010 was $3.3 million, a margin of 5.5%. AUM at NFP’s corporate RIA was $9.3 billion as of year-end 2010, up $1.4 billion from the prior year.
The Advisors NFP Is Looking to Attract