After working for an industry broker/dealer, Alex Reffett broke away and co-founded East Paces Group to provide more customized money management solutions to his clients. As a visionary, he spearheads the company’s growth strategy, forging strategic partnerships and leading advisor recruiting and acquisition efforts.
Russ Prince: Despite all that’s been going on in the world, you’ve been steadily growing your firm, East Paces Group, over the past couple of years. Tell me about your firm and what you’ve been doing to build this momentum.
Alex Reffett: East Paces Group is an Atlanta-based RIA that provides wealth management and financial planning services. My fellow co-founders, David McInnis and David Curry, and I started the business after finding ourselves frustrated with the limitations in investment and financial strategies our previous advisory firm offered. We decided to start our own RIA with the goal of providing our clients with custom and turnkey portfolio solutions. So, I understand firsthand how intimidating and difficult it can be to break away and start your own firm.
We’ve had an aggressive strategy in place since our inception in 2019. As part of that strategy, we’re growing an independent RIA network that provides advisors with the flexibility they’re longing for but with the infrastructure in place to provide a sense of security as they transition to independence. We also knew we wanted to recruit top talent and create a well-rounded team of elite, experienced professionals that specialize in different areas of wealth management. This collective wisdom allows us to provide for our clients beyond their expectations, which makes our business referrable—a key component of growth.
When the pandemic hit, our firm’s flexibility allowed us to not only continue to operate but also grow our AUM. While many wirehouses had strict policies in place that prevented their advisors from growing their business, our advisors flourished.
Prince: Often advisors feel they have two options in this industry: work for a wirehouse or go independent. But you argue that an independent RIA network can provide the “ideal” middle ground. How does this option help an advisor strike the right balance between independence and captivity?
Reffett: Part of the fear of going independent is balancing all that comes with running a business while maintaining your responsibilities as a financial advisor. From payroll and benefits to growing and maintaining a staff to establishing software and creating processes, there is so much that goes into running an advisory practice to the point where it can become distracting and take away from an advisor’s role as their client’s financial quarterback. On the flip side, even though wirehouse advisors have the support of a large corporation behind them, they can also feel restrained and limited. The large retail banks want a say in what you’re selling to your clients, and you’re subject to their way of doing things.
Ultimately, advisors are looking for solutions for their clients. Realizing this, we wanted to offer a platform that would give them the support they need but with the flexibility to customize solutions to best fit their clients’ needs. We’ve had seasoned advisors join our RIA network and experience some of the largest surges in growth that they’ve seen in more than a decade. A lot of this success can be attributed not just to the support we provide, but also to the opportunity it gives advisors to leverage their partnership with us, demonstrating size and strength, which ultimately helps them to close more business and bigger accounts.
Prince: What support are you providing your advisors?
Reffett: Our platform provides advisors with a general infrastructure while still giving them the flexibility to manage their day-to-day. We offer payroll, support, and operational staff, tools, and technology including CRM and performance reporting software as well as a wide scope of investment strategies that can be customized. Also, one of the biggest fears in going independent is the compliance requirements, so advisors are relieved when they find out that we take that off their plate as well.
Prince: M&A deals have dominated industry headlines in recent years, and it doesn’t seem to be slowing down. What trends do you foresee in this space for the industry going forward?
Reffett: I believe we’re in a cyclical environment and by understanding that cycle, you can get a better idea of what’s next for our industry. As you mentioned, the wealth management industry is in an M&A boom, but as some of these large aggregators continue to grow, many of them are slowly becoming independent wirehouses. This will ultimately result in regression, or the next phase in the cycle, and I think we will see more independent breakouts in the future. As for East Paces Group, our goal is to avoid ever becoming an aggregator in the M&A space and instead focus on steady, organic growth.
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