Return-to-Office Resistance Is Pushing Advisors to Seek New Firms: Cetera Exec

Following a record second quarter in which Cetera Financial Group recorded $3.6 billion in new assets that joined its network, the firm “will have an even better third quarter,” according to John Pierce, head of business development at Cetera.

“When the quarter closes” at the end of this month, “we’ll have our best asset gathering quarter probably in our company’s history,” he told ThinkAdvisor in an online interview.

Cetera had chalked up its Q2 business development results to several key additions to its sourcing and engagement team in the first half of this year. The results also underscored the firm’s efforts to ramp up its business development and recruitment strategy amid ongoing changes in the financial advice sector.

But the overall macroeconomic “environment has been very helpful for us” because the volatility has made many advisors realize they can make more money working for an independent firm than a traditional channel, Pierce said in the interview.

Meanwhile, some of the larger firms, including regional broker-dealers and wirehouses, are forcing advisors and other employees to return to the office. Many of those advisors are “resistant,” and that “resistance level is increasing,” he said.

Although “I can’t say that we have benefited with more hires” as a result of that at this point, he said: “What I can tell you is that our pipeline has dramatically” increased with advisors who are “dissatisfied” with their current firms.

“And now that they’ve been independent basically for two years” while working remotely during the pandemic, many of them realize they are making 40% to 50% on the grid when they could break away and earn considerably more than that, he noted.

Meanwhile, more people need advice than ever before as a result of the pandemic and the ensuing economic volatility, he said.

Another factor that has benefited Cetera is “people are finally waking up” to the enterprise value that it offers, he said.

Echoing what he told ThinkAdvisor in January, he said Cetera also continued to benefit from the fact that the “quantity game, the headcount game, the total asset game” that was played in the past just isn’t as effective as it once was. “I think people have realized that there is a big difference when you focus on quality,” he said in January.

(Pictured: John Pierce, head of business development at Cetera)