Cambridge Investment Research announced today that Chairman and CEO Eric Schwartz, who founded the independent broker-dealer 35 years ago and led the IBD world’s entry into fee-based compensation, will become executive chairman of the Cambridge board effective Jan. 1, 2017.
Amy Webber succeeds Schwartz as CEO and will retain her position as president, while Ryan Reineke, formerly COO and senior vice president of technology, was named chief operations and technology officer; General Counsel Seth Miller was named to the additional post of chief risk officer, with responsibilities including advocacy and compliance; Kyle Selberg, who has headed recruiting for the IBD since 2008, was named chief business development officer. All will serve on Cambridge’s Executive Council.
In the company announcement, Schwartz emphasized that “I am not retiring,” and that Webber “continues to report directly to me, with the rest of the firm continuing to report under her as it has for several years.” Schwartz has been planning his succession for some years, with the stated intent of keeping Cambridge private and retaining key executives. All the executives named in today’s announcement are longtime Cambridge workers; Webber joined Cambridge in 1998 and has been president of the Fairfield, Iowa-based firm for a decade.
Cambridge has received many honors over the years, including numerous Investment Advisor Broker-Dealers of the Year, including in 2016. Schwartz himself was named a member of the IA 35 in 2015, the magazine’s list of the most influential people in the advisor business over all the years the magazine has been printed. In an interview then, he said he got his start in the business at age 10, when he bought his first stock. As an adult Schwartz became what he called a “small syndicator” of oil and gas partnerships, then launched his own broker-dealer in 1992.
“Most BDs didn’t do fees then, maybe it was only 1% of the total business” of broker-dealers. But he said that in talking to reps who were doing fee work, “I discovered these were entrepreneurial people,” and “kept calling my attorney to ask ‘What could we do?’” to accommodate them. He says now that it was by “listening to the reps — what all BDs should be doing — that I was closing 50% of more of fee advisors” that he attempted to recruit.
“I’d like to say it was my brilliance about fees, but it was really the one niche nobody was doing,” he jokingly recalls now. “I coined the term ‘The Fee Experts’ in our advertising,” and the business took off.
— Check out Cambridge Says Its Advisors Will Keep Commission-Based Accounts on ThinkAdvisor.