Two top Fortigent talents leave in the same week as industry-watchers ask: Was it them or was it LPL?

Unfortunately there is always some senior level fallout after a takeover.

As a Fortigent client – I am sad to see Nathan and Rob go, but I’m happy that Scott, Jamie and Andy remain.

There is terrific high level redundancy occuring within the industry through the enhancement of technical capabilities achieved through acquisition.

It is very likely that LPL, EnvestNet and others through process and technology will find a way to preempt the major wirehouses with a value proposition and lower cost than a packaged product which outdate the old product focused commission brokerage business model. The opportunity is serving the best interest of the investing public, not product distribution where the broker is neither responsible or accountable for their recommendations.

This awakening to the consumer will entail much innovation and change in the best interest of the investing public, but the resulting transformation literally shifts the balance of power to advisors and firms who are focused on the well being of the consumer rather than product sales/distribution. It is what you do with a product or authenticated prudent process that adds value, not the product.

The end result is a much lower head count, much higer level of support achieved through process and technology, and an unprecedented level of investment and administrative counsel which results in far higher advisor productivity at a cost lower than a packaged product.

The departure of these esteemed Fortigent executives is the beginning of the industry at large taking a look at an outdated brokerage business model and embracing modernity…to be repeated time and again in every aspect of the industry until the competitive market place settles into how to best serve the best interests of the investing public—a very high standard not possible today.

The industry does more with less, advances an ever higher level of counsel while achieving unpreedented earnings, margins and multiple. What is required is the vision, management skill and talent at the top to execute.

SCW

Mr. Southall,

I believe the answer to your article’s opening question (Was it LPL..?) is answered by Mr. Casady himself. You quote Mark as saying:

“we’re going to take a year or two to basically invest in them… basically take that from zero profits to making some money.”

That ho-hum stamp of mediocrity would inspire anyone to see the writing on the wall. You can feel the product manager(s) squirming in their seats knowing that what was once a product with a real future has now been relegated to an asset gathering tool. That is about as satisfying as Charlie Brown once said:

“Working here is like pissing yourself in dark clothes. It gives you a warm feeling but know one else knows”

I hope I am wrong, but given the performance of the behemoths like LPL I am not going to hold my breath. Then again I don’t have to because I’m dead already.

JLL

It was Fortigent – anyone that knows the inner workings of the company would know this. Something that had been coming for a long time.