There is a new kid on the bloc in Naples, Florida, in the form of Vantage Private Wealth, founded recently by Matthew Pietzak. He is no “kid” - he has 17 years of financial services experience already - but like many other wealth professionals, the need to set up a new business and break away become almost inevitable after just over a decade and a half of work.

“I’m excited to build a business based around providing clients with the highest level of service,” he told Family Wealth Report shortly after the report of his new business was published. “I felt that I needed to build an independent firm to focus on the needs of my clients,” Pietzak said.

It was an emotional experience to walk out of his old firm and daunting at first to start afresh, with a family to support, but Pietzak said the new start is going to be worth it. 

“A lot of people in my line of work are reluctant entrepreneurs and all they want to do is have a quality business,” he said.  

Most recently at PNC Wealth Management, Pietzak had overseen $300 million in assets; his background also includes experience with Wells Fargo Private Bank, Bank of America, and UBS PaineWebber.

An issue with many large organizations, particularly those driven by shareholder concerns about returns, is that the interests of clients will not always come first, and that bothers lots of advisors, including Pietzak. 

“With the years of experience under my belt, I felt now was the right time to take the next step in building an independent firm.,” he continued. 

The issue of ensuring that conflicts of interest don’t hurt clients has come up recently with the advent of the Department of Labor Fiduciary Rule, and the pressure it creates on advisors to set clear fees for services. When asked about this, however, Pietzak said it was not really relevant at all to his desire for change of career.

Vantage Private Wealth has two broad areas of business. Firstly, it caters to clients with taxable assets from $1 million to $10 million, where specific kinds of advice, planning and support are needed, and second, his firm aims to provide family office-style services for those tilting towards the more ultra-high net worth end of the wealth scale. “We are here to protect the time of clients and allow them to delegate anything that comes up in their lives,” he said.

Pietzak enjoys working with clients who have built businesses from scratch and acquired a wealth of experience along the way. It is a community of people he warms to. “It is so impressive that these folks have done these things and have their stories,” he said. Clients are likely to be from Florida and the southeast of the US; in many cases such persons have multiple properties and have business interests around the country, and beyond, he said. A key feature of their lives is financial complexity.

And Pietzak feels that his kind of focused, independent wealth management firm fills a large space so far not filled between the big-name asset managers and banks, “robo-advisors” and wire-houses.

Breaking free
Pietzak’s business is part of a trend of advisors leaving wire-houses and other large, vertically integrated businesses to set up on their own. To do so, however, they need help from service providers giving the kind of support, such as for marketing, compliance and accounting,that they once would have received in-house. This is where the firm TruClarity came in. Vantage Private Wealth used TruClarity for its launch; TruClarity is a relatively new firm looking to capitalize on the growing exodus of wirehouse financial advisors seeking independence. TruClarity's "incubator" provides technology platforms and support, including: access to custodians and other service providers; marketing and branding assistance; and back-office services such as accounting, billing, payroll and reporting. Other firms that provide such outsourced services for breakaway RIAs and others include the likes of Charles Schwab, SEI Investments and Fidelity.

As reported by FWR in 2015, there are roughly 19,500 RIAs in the US; most are quite small, with only 300 above the first glass ceiling of $1 billion in AUM.

The breakaway trend has been around for some time. Another force at work encouraging breakaways is advisor dissatisfaction with their existing arrangements in big firms. A report by JD Power in 2015 found that that number of advisors who would definitely stay at their firms had fallen sharply. 

A 2014 report by Cerulli Associates predicted that asset market share gains in the RIA and dually-registered channels are likely to come at the expense of wire-houses and independent broker-dealers. There is also an age issue: As more advisors retire it has been acknowledged that the independent channel will need to prove its sustainability for growth by acquiring and developing new talent, for example, as it cannot rely on advisor transitions. With that said, the sector is certainly not short of success stories, and with the rise of platforms such as HighTower, Dynasty and Focus Financial Partners targeting this segment, it is becoming increasingly clear that, for many, the idea of going it alone is no longer a point of anxiety.