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Dynasty Financial Rolls Out Framework for Expanding RIAs

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Dynasty Financial Partners said Thursday that it is celebrating its five-year growth spurt by introducing a framework for its expanded services, which should boost the business of registered investment advisors feeling hamstrung by paperwork.

The partnership’s framework, referred to as Dynasty’s Core Values Pillars for RIAs, has seven areas of support: educational events, technology, finance, investments, marketing, compliance and practice management. The firm serves some 37 RIA firms with about $20 billion in client assets by providing them with a turnkey wealth management and technology platform and other services. It has offices in New York, San Francisco and near Miami.

“The pillars make for a clearer packaging of our integrated capabilities. They’re intuitive,” explained CEO Shirl Penney, in an interview with ThinkAdvisor.

Dynasty’s client base includes longtime independent RIAs, as well as breakaway advisors from the wirehouses and other broker-dealers. The independent RIAs have a very clear need, Penney says.

“They tell us they want to grow but spend 60 to 70% of their time on middle- and back-office [work],” he stated. “They max out at between $300 million and $750 million [in client assets] because of operational constraints … We get a lot of calls from RIAs in this range. Their growth is stymied, and they want more time to get beyond this asset level.”

This demand is prompting Dynasty to strengthen and streamline its platform, which includes mobile access to accounts for advisors and investor clients and more digital capabilities.

“Technology is the corner piece of our propriety advisor technology. Our centralized desktop … includes information on clients, investment research, market data, records, profit-and-loss information, and more in one central location,” Penney explained. “And our proprietary client portal gives RIAs aggregated information and can be used as a virtual vault for other documents, like wills, trusts and investment policy statements for clients.”

The firm rolled out an iPhone app for RIAs and their investor clients four months ago, he adds. (The RIA desktop was introduced about a year ago and can be accessed on a variety of devices.) Many of the RIAs who have partnered with Dynasty for several years “will say that, in large part, because we do the mid- and back-office work for them, they can grow at levels that are above the average of their peers,” says Penney.

The executive expects further outsourcing and “professionalization of services” within the RIA channel to continue, as the need for efficiencies increases. And as firms get larger, the industry space should consolidate further, he says.

“That means more good times for those of us providing integrated services to high-end advisors in the RIA community,” Penny said.

His colleagues agree.

“Independent wealth managers continue to be the fastest growing segment of the industry, and we expect a continuous strong flow of advisors moving from wirehouses and IBDs,” said Dynasty Chairman Todd Thomson, in a statement. “Technology, regulatory and scale challenges will drive an inevitable consolidation within the independent segment. The Dynasty Core Value Pillars are the framework we use to professionalize the Dynasty Network firms and ensure they will thrive, grow, and provide the industry’s leading support and services for their clients.”

The trend has been about a decade or so in the making.

“When we did our due diligence eight years ago, we met 40 to 50 large independent RIAs. Some of them had six screens they had to toggle around in order to use various applications. The process involved juggling something like 40 different vendor balls,” Penney said. “They needed an integrated services company to run their businesses.”

This research formed the basis of Dynasty’s work and platform, according to Penney. “We are now building out all its capabilities. It’s an ongoing process in which we build services under [the seven] pillars. We can always add another pillar down the road, as needed,” he explained. 


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