Building the Firm of Today and the Future With Jim Gold

Douglas Heikkinen  00:00

This is Advisorpedia's Power Your Advice podcast and I'm Doug Heikkinen. We're joined by Jim Gold, who is the CEO, co-founder at Steward Partners Global Advisory. Steward Partners is an employee-owned, full-service partnership that caters to family, institutional, and multi-generational investors. Jim, we talked a couple times, welcome back.

 

Jim Gold  00:33

Thank you, brother. Good to be here.

 

Douglas Heikkinen  00:35

Let's take a look back and reflect for a minute. This company, this event, this advisor group - is this what you imagined was going to happen 10 years ago?

 

Jim Gold  00:50

You know it is it's myself and Hy Saporta, our co-founder, I would say we're the only two people that knew this was how it was going to wind up. We're so honored by the folks that committed to be part of this journey with Steward. If you think back to 10 years ago, right now, I think we might have had 100 million in assets. And now we're over 35 billion, 500 Partners, a fortune 500 Board of Directors, 100 person management team, with just incredible, incredible talent. So, we're here at the symposium, which is our seventh annual one. It's our largest by headcount, by advisor attendance, by overall attendance. And we're super excited to be here. This is really the Steward family reunion every year, we get together as a family, we share, we break bread together, we have some fun together, we share best practices together, we help each other get better as partners. That's what partners do.

 

Douglas Heikkinen  01:41

It's been a decade, but a decade isn't very long to get as far and as fast as you have. How did it happen so quickly?

 

Jim Gold  01:49

Yeah, we're ferociously interested in growing. It's something we spend a lot of time on growth, I think one of the hallmarks of the firm is clearly the equity story. It's really unheard of that every single person here is an equity owner, everyone has the same equity. This is not animal farm, where there's a different class of equity. And I think that creates a culture where people say we are truly aligned. And I think it's a testament to the firm that usually about half of our new advisors are referred by existing advisors. So that tells me that the people that are here are happy, and they want to bring their friends along for the journey,

 

Douglas Heikkinen  02:25

Did the decade flyby for you, did it just go so fast?

 

Jim Gold  02:30

It's like 50 years and six months all at the same time. I mean, we look at some of the pictures and think of all of all the milestones. And I always say it'll make a great movie someday. But I do think and the theme of this conference is "aint no stopping us now" because we really feel like we are now firing on all cylinders. We have the scale, we have the capital, we have two terrific outside investor family offices that work with us on our board. And we really feel like now we have an opportunity to do something extraordinary.

 

Douglas Heikkinen  02:58

Think about some of the high points over the past. What have those been?

 

Jim Gold  03:01

You know, it's almost like the Darwinian pyramid where the early days was all about survival, right? And I think that's where you start out with that real hunger and desperation. And I think if you took 1000 bingo balls and put them in a hopper 999 would say bankrupt, and one would say what we did. So we have always kept that fire. And I think great companies have to evolve, you can never get so in love with your business plan that you think it's the only plan. You have to listen to people. The highlights to me are as the folks have joined us, ya know there's financial milestones. The thing I take the most pride in is we've had so many accolades, you know, financial accolades of you know, top 19th largest Ria, according to Barron's, but it's the best places to work. It's the great accolades about the culture of the firm and the organization. But there's just so many moments we've celebrated. And that's really what this event is about. We have our award ceremony tomorrow night will award our top producers and top growers and they're all in the room down the hall sharing ideas right now. So there's really thankfully for us too many milestones to count, but I know there's many, many more ahead, which we're excited about.

 

Jim Gold  03:43

But with growth always comes challenges. So what have been some of those?

 

Jim Gold  04:13

Yeah, there's always the law of unintended consequences. So there's things where if you want to be a, you know, a Voyager and sort of explore new territory, sometimes you kind of hack a path through the woods and you come to a cliff and say, Okay, everyone turn around this, this was a mistake. So listen, we've made hiring decisions that were not the right decisions. We've tried out technology that didn't work out. But I think as a leader, and as an organization, listen, people expect you to make mistakes. Every company makes mistakes, great companies, admit them, apologize for them, and you fix them. And when you're a partner here, the partners say, hey, how do we help the company fix this? How do we help get back on track, whether that's a platform or technology or tool. So it's all about I think transparency, some of its financial. We're very fortunate to have the investors on board with us. They were instrumental. We established a credit facility about a year and a half ago now, that was all the work of our outside investors. So you have to have the resources around you, and the talent around you. But at some point, you're staring into the abyss, you got to make the right decision. And hopefully it works out.

 

Douglas Heikkinen  05:18

The word culture is thrown around a lot in the industry. And it's it's very evident here. But there's something beyond that. It's it's been mission driven. And as you grow bigger and bigger, how do you make sure you keep all the oars in the right direction? Rowing at the same time?

 

Jim Gold  05:32

Right yeah, we had yesterday we had a day, we call it sort of the Steward family update. So we spent four hours in a room together just the partners of the firm. We heard from our top executives, we heard from our advisor council and our administrative counsel, we heard from the board of directors who sat there and did a town hall. So it's a totally transparent conversation. Here's what we're working on, here's what's going on. But you have to find the right people. It's being the gatekeeper for, if you're meeting an advisor and you go, I don't know, if this person is a good fit for our culture, you have to have the courage to walk away from that opportunity. We've done it dozens of times, we're not the right place for everyone. Because being a partner here, you have to opt into, I want to draw from the well. But I also have an obligation to put back into the well and help others. And not everyone has that mindset. That's okay. So I think the partnership culture here is real. My favorite thing about this event is meeting people's spouses who will say, "hey, Jim, thanks for giving me my husband back. He's so happy here. This is the best place he's ever worked. He comes home from work. He's excited to talk about work, and he can't wait to get on the next call and hear what you guys are doing what you're building is amazing. We're so honored to be part of it."

 

Douglas Heikkinen  06:45

Since you started way back, how has the advisor evolved?

 

Jim Gold  06:51

Well I think the Advisor has evolved dramatically. If you look at the changes within COVID, and things like podcasts and zoom calls, I mean, if I wanted to talk someone over zoom five years ago, they think that was very strange, right? So I think the clients now are have another level of expectation. They need to access their advisors, anytime, anywhere. And that's all through the good use of technology. I think financial advice is getting more complex. And I think that's why I've been doing this long enough. I'm going on 30 years in the business that all the threats of Oh, the robo and this and that it's all going to be there. They all have a place but the need for real advice and trusted advice. When the markets crashing, you can't call your robot and ask them what to do. So I think they need that advice. I think the advisors have to have a team around them that they need to have a team of generalists in certain areas, because you can't be a specialist in everything. I think we're seeing a trend though, where we're seeing people looking for scale. And I think they come to a firm like Steward because you have to have capital, you have to have infrastructure, you know everyone wants to do m&a. But how do you deliver that process? How do you help integrate that business over? Have you ever done that before? Do you have the capacity to do it, we're fortunate today to say we do.

 

Douglas Heikkinen  08:06

The boomers and the silents are aging out and next gen is coming in. And they have a huge responsibility of having the assets or deciding what to do with the assets. How are you prepared for all that with some of your advisors aging out and the next gen coming in as well?

 

Jim Gold  08:22

Yeah, I think a new iteration of Steward – and I don't like the word pivot, because pivot suggests you're walking away from something – so we now have another way to grow the organization and service that we're seeing this new trend of what I talked about as breakaway m&a,  so advisors at a large Big Four firm who say, Hey, I have a practice, I have a G1, G2, G3, the G2 and 3 don't have the money to buy me out. We don't want to stay at our firm for the rest of eternity. I don't want to leave my clients at this firm for the rest of eternity. How do you facilitate that, so we have this division now where advisors have decided to sell their business to Steward, and many of them want to stay. So by having that sort of anchor tenant now at Steward, that gives us the capacity to bring in other advisors who want to monetize what they've built. But they really, really care about their legacy they care about who's going to be the caretaker of their legacy. And you have to have the right quality, talented people that want to be here to help serve them. And we make introductions, we want to make sure they're comfortable with all this. So we're seeing just explosive opportunity in that area.

 

Douglas Heikkinen  09:25

35 billion is a huge number. What's next for Steward Partners?

 

Jim Gold  09:29

So I think I told you this last time we spoke, we're going to build a billion dollar revenue firm. And we're on our path there. So we think we need about another, you know, 80, 90 billion to go. And if you look at, we had a presentation from one of our outside investors yesterday, and they invested five years ago. So think about this - five years ago, we had just under 8 billion in assets, five years ago next week. So when you think about the idea of getting to 100 billion or 120 billion, it doesn't seem onerous to us. He actually talked about Steward needs to compound at 22% to get there in the next seven or eight years. We were up 17% in the first quarter. So we're just, we're compounding at such a high level with high quality people. If you look at our advisors, two thirds of our advisors, CFP designated or higher, our average producer has over a million dollars in production which is unheard of for an independent firm. We had 24 Forbes best in state advisors. I look at firms out there, I won't name names, but I see regional firms who have five times our headcount that only had twice our number of Forbes best in state advisors. So it's not just growth, it's high quality growth and high quality people.

 

Douglas Heikkinen  10:37

And it seems like you have investors that are aligned with you and the advisors for the best benefit of the investor.

 

Jim Gold  10:43

100%. Yeah, I think that comes from them understanding us on the way in and whenever I meet a potential investor, I always kind of politely say, Listen, I'm here on behalf of everyone that believed in this organization. So with respect, you're not actually interviewing us, we're interviewing you, right? Because capital is easy there's tons of capital out there. So you really, really need to be careful and deliberate in who you take capital from, and make sure they want what you want. Everyone wants a great return. But you don't want that great return at the detriment of everything you've built.

 

Douglas Heikkinen  11:11

Not all capital is good capital.

 

Jim Gold  11:13

Amen.

 

Douglas Heikkinen  11:15

Lastly, you've been a leader for a long time, what advice do you give to other people about being a great leader.

 

Jim Gold  11:21

Listen, I think you have to be honest, I think people expect you to make mistakes. I've told everyone I've ever worked with, I'm going to make mistakes, and you're going to have two things happen. I'm gonna tell you, I'm sorry. And I'm going to fix it.  And that's probably the biggest attribute people want out of a leader. You don't have to be the smartest guy or the best speaker or everything else. It's that core integrity people want to work with. And I would say advisors are amazingly, they're not needy people. They really want a few things. You know, give me a simple comp plan. Don't play around with my comp. Give me the resources to run the business. I want to be fully compliant, but make it easy to do business. When I need your help. Help me. And boy, if I can have fun with you and like hanging out with you, this can be the best place I've ever worked.

 

Douglas Heikkinen  12:06

Jim, it's always a pleasure to spend time with you. Your organization is just fantastic.

 

Jim Gold  12:10

Thank you, brother. I appreciate it.

 

Douglas Heikkinen  12:12

To learn more about steward partners, please visit Steward Partners.com. Please follow us for timely updates on X, LinkedIn, and Facebook all at Advisorpedia. From everyone at Advisorpedia, our producer Julia Smollen, our engineer Tory Miller and the Power Your Advice podcast team. This is Doug Heikkinen.