The independent broker-dealer launched the program, led by LPL veterans Esther Stearns and Kandis Bates, last year. It aimed to recruit and train new financial advisors and explore direct-to-consumer operations for middle-market clients — a strategy similar to that being pursued by Merrill Lynch, for instance, through its more upscale Merrill Edge platform aimed at the mass affluent.
“The NestWise program was extremely valuable in terms of developing workflow technologies and learning about advisor development and training,” the company, which is headed by Mark Casady, said in a statement shared with ThinkAdvisor.
“However, LPL Financial believes financial resources earmarked for NestWise can be more effectively deployed in other areas of the business and will be redeployed into our core business consulting activities for both advisors and institutions for training development,” it explained.
The business initially was called LPL New Venture. Stearns, the former president and COO of LPL, was tapped to lead it in the spring of 2012. At the same time, Bates, who led the IBD’s communications operations, became the unit’s chief administrative officer.
In the summer of 2012, NestWise acquired Veritat Advisors, the brainchild of Wharton professor Kent Smetters to scale up its financial-planning platform. Its hope was to use Veritat to help it reach some of its target audience, which consisted of 32 million middle-class households.
That ambitious plan, however, does not appear to have worked out.
According to its SEC filing of October 2012, NestWise had 37 employees, 13 of whom are registered reps and 15 of whom are investment advisors. The unit also had 120 clients and some $129,750 in client assets. (The company says that its asset level is much higher today, as the next filing should show.)
While the IBD adds that NestWise employees and advisors are “welcome to apply for other positions at LPL Financial, Stearns (left) says it is time to take a break.
“I will not be pursuing any plans at LPL or [its] affiliates,” Stearns said in a statement. “To me, the most important thing is that our industry continue to find ways to support the middle class with their increasingly complex and challenging financial decisions. I have no specific plans other than to take some time for reflection. Recently someone said to me that there are always ways to help people. My challenge is to find the right one for me.”