Goldman Sachs, the once seemingly impassable garden leave …
I write a lot about changes in the landscape—whether it’s information about a new business model, relevant trends that we’re seeing, or discussing any of the headline-gripping announcements from firms that can ultimately impact the business lives of advisors. What strikes me about the past 12 months is the frequency and speed of transformation that we’re seeing. Even more striking is the evolution of the advisor population at large: Their courage and determination to live their business lives as they see fit, regardless of the obstacles they may encounter.
For example, over the past two decades rarely did we see Goldman Sachs Private Wealth Advisors leave the firm. Of course, the cache of the name alone and a belief that there was no better option kept many of the industry’s finest in their seats. Yet for many others, concern over withstanding the nail-biting period of garden leave, as well as the potential legal battle that might ensue, served as extremely powerful deterrents.
The fact remains that it was always considered a rare exception when a Goldman advisor changed jerseys. That is, until it started to happen, and not just once: In the last 12 months or so, we have watched 5 high-quality, top-notch, mega-teams jump from the Goldman ship.
So why am I outing Goldman advisors? Because in a world where advisors are in the driver’s seat, with virtually every make and model of opportunity available to serve their clients and careers as they see fit, many still believe they are “virtually handcuffed” to their firms. And for Goldman advisors, those handcuffs are stronger than most.
Yet despite potent deterrents like garden leave, the determination to live their best business lives is winning. So all this begs the following questions:
What’s going on in the industry that’s serving to push the finest advisors with the most restrictive post-employment mandates out of their firms?
Answer: It’s likely different drivers for everyone, but generally speaking, it’s about a growing sense on the part of the advisors that they don’t have control over how they are compensated and how best to serve clients.
Where are these brave folks going? Is there any commonality in their choices?
Answer: Not really. Where they are going is fractured—to Morgan Stanley Private Wealth Management, to First Republic Wealth Management, and three to different versions of independence. Having facilitated two of the biggest moves in the past year, I can tell you that once the advisors made the decision that it would be worth the risk of leaving, it became very clear where they wanted to go. (There is no shortage of exciting options for the industry’s top talent as most Goldman PWAs are aware.)
And, most importantly: What can advisors who are worried about a non-Protocol world learn from these Goldman moves?
The fact remains that there is more to a non-Protocol move in terms of planning, process, time and risk. And for Goldman advisors, these considerations are multiplied. So what is it that other advisors can takeaway from those who’ve gone before them? What realities should they be aware of before they even think of making a move? Consider what I call the “6 Gottas”—
- Gotta really want it
You believe verily that there is a better place to run your business. Said another way, there are significant enough frustrations pushing you out the door, as well as an obvious and tangible opportunity elsewhere that is more than marginally better than what you have now.
- Gotta really believe in the loyalty of your clients
You will be putting your relationship with them to the ultimate test—because if they’ve been unhappy with you, this is an opportunity for them to vote with their feet. Honestly assess the depth of your relationships and then trust in them.
- Gotta have tremendous self-confidence and self-belief
Any move requires a good amount of aplomb, for sure. You’re betting on yourself and your team, that you’ve got the goods to make this work.
- Gotta have patience
Proper planning makes porting over clients far less of an arduous task than it was years ago and, especially for those managing a small number of relationships, it usually happens pretty quickly. In the case of Goldman advisors and those moving from private banks where portability always takes longer, taking the long view is the only way to go.
- Gotta have a long enough runway so that the effort is worth it
We move advisors of all ages and stages in their careers, and in each case considering the benefits vs the time they are looking to stay in the game is key.
- Gotta be risk tolerant
Let’s be honest: There is some risk associated with any move, and so for those who don’t believe they have the mettle to tolerate any bit of it, staying put may be the better option.
The big lesson learned from the recent trend of Goldman advisors on the move is that if they have the chops to find a way to better serve their clients and their careers – despite the potential toll of garden leave – then it stands to reason that advisors with less restrictions can muster up the courage to do the same.
We’re now living in a world where we all have more options than ever before. It’s not that the notion of risk or fear has disappeared, but the desire for something better has grown stronger—and with all of the options and opportunities available, that desire can be more easily translated into something attainable. It still takes the “6 Gottas”—but if you have them covered, then you’re on you’re way to building your next chapter.
Beware of the Energy Vampires
When Financial Goals Aren’t Enough!
Finding Senior Care on Limited Budgets
What Is a Key Employee and Why Are They So Critical?
Listening to Understand Is to Stand Under
What Support Looks Like in Leadership
Don’t Make Your Financial Content Buzzkill
Legacy Vendors Are a Bigger Issue Than Legacy Systems
Are You Aware of These Nine Risks to Your Portfolio?
Catching People Doing What’s Right Along the Customer Experience Journey
Learn15 hours ago
A Surprising Post-Election Investment Idea
Development15 hours ago
The Extraordinary Power of the First 90 Days
Digital Strategy15 hours ago
FINRA and Compliance In The Era of Fake News
Building Smarter Portfolios2 days ago
Beware the “Known-Unknowns”
Learn2 days ago
Cybersecurity Without The Commitment
Development2 days ago
How Freedom Resulted in $300mm to $800mm in Just 8 Years
Insights3 days ago
How to Start Your Journey to Be Different
Advisor4 days ago
11 Ways the New Tax Law Could Help or Hurt Your Tax Return