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Breakaway Advisors Say They’re Happier Independent: Dynasty

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What You Need to Know

  • The vast majority of RIAs in Dynasty's network who were polled said they were happier going independent.
  • But the advisors surveyed said challenges included a large learning curve and building their businesses almost from scratch.
  • This was the first Dynasty breakaway advisor survey and the firm plans to conduct one annually, it said.

Breakaway advisors and their clients are happier and the advisors are making more income after going independent, according to the findings of the first Dynasty Financial Partners breakaway survey that the firm said Tuesday it plans to conduct annually.

The advisors surveyed “were not shy about discussing the obstacles they had to overcome on the road to independence,” the company said, pointing to challenges cited that included a “steep learning curve” and “building a business nearly from scratch.”

But the owners of independent RIAs said they would gladly face those and other challenges of breaking away again to secure the benefits they enjoy now, according to Dynasty, noting the survey was conducted online last month for it by SurveyMonkey.

The survey’s results, however, were only based on a small pool of participants that included 23 of the over 300 advisors at 46 independent RIA firms managing over $60 billion in assets on the Dynasty network. The 23 advisors that responded have clients throughout the U.S. managing about $27 billion in assets collectively, Dynasty said.

Dynasty provides wealth management and technology platforms for independent advisory firms.

All of the advisors polled said they had a greater opportunity to build equity value in their business after becoming independent RIAs, had more control over their business decisions, and found independence worth it and would do it all over again, according to Dynasty.

Meanwhile, 15 of the 23 advisors said they were able to convert more than 90% of their assets from their prior firms, while more than 50% had accumulated well over 100% of their assets through substantial growth, and 11 of the 23 advisors saw 90% or more of their assets converted within the first year of transition, Dynasty said.

In other survey findings, 96% said they had better relationships with their clients since transitioning to independence, while 91% of advisors saw an increase in their net worth since going independent, said they had more freedom to focus on the unique needs of their clients​​​​​​, viewed the technology at their firm superior to what they had before going independent, and agreed their resource partners provided more value than what was available before going independent.

“We verified what we had long been hearing through the grapevine,” according to Shirl Penney, Dynasty CEO. “That is, our breakaway advisors value their independence for reasons they have no trouble articulating,” he said in a statement.  “Bigger picture, given our over 10 years of experience working with many advisors to transition their practices, we felt it was time to start sharing our insights on breakaway-advisor sentiment. We plan to track this sentiment over time as an industry resource.”

The initial drawbacks of independence just do not come close to competing with its benefits, according to John Sullivan, Dynasty’s head of network development.

“These breakaway RIAs are helmed by entrepreneurs who know that every transition comes with friction, and that engaging transition experts and keeping the big picture — more customized solutions, better client service, greater equity value — in view is imperative for success,” Sullivan said in a statement.

(Pictured: Shirl Penney, CEO of Dynasty Financial Partners)