Orion & Brinker Ready To Rock Wealth Management: Don't Get Left Out

A lot of people are talking about the merger of Orion Advisor Solutions and Brinker Capital in terms of either speed or scale. Early signs suggest that the reality will disrupt the industry on both fronts.

We talk a lot about turnkey asset management here for a few reasons. First, it's the engine of change in the wealth management world. For most of us, life revolves around incremental progress from day to day. It's about having the discipline to keep showing up and stay on course.

But occasionally that slow progress makes big leaps when we see a technological or operational breakthrough open up possibilities that simply weren't there before. In Silicon Valley they call it "disruption." It's how mature industries are transformed.

That transformation looks a lot like creative disruption. It tears down old systems in order to make way for new ones. Entrenched leaders need to pay attention or contemplate the fate of the dinosaurs. 

That's the drama. If you want to rise to the moment, there’s still time to join the conversation at TAMPS.biz. We’re happy to point you to the right partners.

Orion and Brinker have plenty of narrative force on their side. Their merger combines $44 billion in managed assets (largely from Brinker) with well over $1 trillion on the core Orion technology platform.

That's more than bolting AUM onto AUM to create efficiencies of scale. It's more than adding new functionality to an existing technology suite in order to boost retention and entice new enterprise wins.

It's something new, a literal combination of technology with finance that helps create a category somewhere in between. Venture capitalists call it "fintech" but a lot of the players in that field are ultimately more sizzle than substance. 

The turnkey asset management space, however, is the real deal. Distributing investment ideas across a digital network was only the first step. Once the delivery platform is in place, asset managers can package and push every aspect of their expertise to a world tired of vanilla index funds.

And wealth managers who consume that expertise can also push out aspects of their own operations that they can naturally do better than most of their peers. Whatever your differentiating edge is, there's an opportunity here to codify it, automate it and give other advisors the chance to rent it from you.

That's what's exciting about Orion and Brinker. These deals (and there will be others) create entire ecosystems where portfolios and processes circulate. The end-level advisor always controls the relationship with the end-level investor, but everything behind that critical communication point is open to negotiation.

"Our shared goal is to support every aspect of a tech-enabled fiduciary process," Orion CEO Eric Clarke says. It goes beyond the portfolio. "Together with Brinker, we'll give advisors more resources to build strong client relationships."

Clarke envisions a world where the same technology unifies all advisory processes from prospecting through business development. Bringing Brinker to the game creates a strong position on the portfolio management piece, while other acquisitions pin down marketing, financial planning and so on.

That's not exactly a "TAMP." It's something bigger. As he puts it, "the industry is already evolving from an investment-driven [model] to advice-driven value." Continuing that evolution will require more automation and integration on the advisory side, but the process is already underway.

Other players in the industry are trapped in a silo mentality that segments the client-advisor relationship into a series of transactions, he says. It makes sense. We all know that mentality can feed redundant capacity and frustration. 

We all want to be essential. We all want to find a role where we excel. Your firm undoubtedly has one to play in the industry to come. Once you know what it is, there's nothing stopping you from letting other advisors share what you've built . . . for a price, of course.

Orion had the technology. Brinker had the investment management side. Other industry leaders can evolve into other niches and participate in the ecosystem. But you need vision to think outside the old box.

That's the kind of vision that helped these companies combine in less time than some TAMPs take to onboard a new customer. Noreen Beaman, who ran independent Brinker and is now president of the unit within Orion, says both companies are "laser focused" on the goal of transforming the client-advisor bond.

As she puts it, "a shared vision is a strong vision." You can't do it alone, especially in a virtual world. We’ve all figured out that you can hold a virtual meeting with clients sequestered across town.

Now there’s no structural barrier to building relationships anywhere. If you have the insight and discipline to give clients a value-added experience, you can distribute that expertise around the planet.

In theory, capacity limits have collapsed. You can reach an infinite pool of investors and provide personalized attention to hundreds of clients without having to find and train a lot of human talent.

That’s a good thing. As Michael Kitces revealed in our recent TAMP Summit, we now live in a world where a solo practitioner can run $1 billion across nearly 300 accounts. (Replay available now.)

Do the math on that AUM and extremely rewarding careers are possible. And if you don’t want to spend your days prospecting, a lot of people are now reversing the way information flows to make the world their sales force.

2021: The Year Of The Strategist

A lot of advisors have worked hard to figure out hard-to-understand asset classes: global stocks, small-cap opportunities, hedging strategies, alternatives for the wealthy. It all boils down to ways to squeeze a slightly better risk-return profile out of the efficient frontier.

Once you’ve established that edge, you’ve differentiated the experience you provide. Historically, you could extend the benefits beyond your immediate clientele by creating a mutual fund, SMA or other collective investment product.

Now, someone with specialized market knowledge can simply package the portfolio model with all the rules required to emulate a one-on-one client experience, then open it up to advisors the world over.

Think of it as designing a portfolio like a phone app and then distributing it via the app store. Other professionals will pay a little to “subscribe” on their clients’ behalf. 

When it works, the platforms themselves push tens of millions of dollars a month your way. All you do is keep monitoring and improving the models.

This is the road that leads from face-to-face advisory practice to what we’re calling TAMP strategy. In effect, other advisors open up part or all of their AUM to you and these become “your” clients to some degree.

And the relationship can go both ways. Pull in part of another advisor’s expertise when your clients need it, push out what you do best. Everyone gets a better and more efficient experience.

We’ve spent years advocating for the “pull” side. Now it’s time to survey what the most ambitious advisors are in a position to push.

If you’re ready for that, just reach out via TAMPS.biz.



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