Joe Duran, founder and chief executive of wealth management firm United Capital Financial Partners, aims to make the firm a nationwide success in the US. He has been talking to FWR about his plans.

Creating a national wealth management advisory firm has long been the Holy Grail of the industry.

But attaining the fabled prize has proven to be elusive in the best of times, and even more daunting in the teeth of a recession.

Enter Joe Duran, chief executive of United Capital Financial Partners.

Duran scored big in the asset management business nine years ago when he played a key role in selling Centurian Capital Management to GE Financial, and he’s thinking big again.

Five years ago he founded United Capital as a roll-up firm that to date has acquired 23 registered investment advisory firms in nine states with a total of about $10 billion in assets under management.

By 2013, Duran envisions a national reach for the firm, with offices in the nation’s top 25 metropolitan markets under one brand name.

“We’ve changed our view of the world,” he said in an exclusive interview with Family Wealth Report. “We’re going to be adding new growth organically as well as by acquisition. We plan on being a national wealth counseling company with one operation, one culture, one platform and on one AVD form.”

Can Duran pull it off?

Possibly, but it won’t easy, say industry analysts.

“It may be a stretch, but it’s not unrealistic,” said Bing Waldert, director for Cerulli Associates, the Boston-based research firm. “I think a super-RIA firm is coming into play, the way successful national independent broker-dealer firms like Commonwealth were created 10 to 15 years ago. A national advisory firm is going to look more like Commonwealth than Merrill Lynch, but it’s not unattainable.”

“I think it’s a viable model,” said veteran industry observer Robert Ellis, principal of Fast Track Advisors, a financial services consulting firm. “The RIA business is just as amenable to scale as the broker-dealer business, in fact, even more so. But to become a national presence, a firm must invest in branding. That’s the big unknown, and it’s expensive.

“The reason on one has succeeded nationally is because firms never got the brand backing. So far United Capital has had no fatal miscues, but it has not invested in brand identity yet.”

Duran says that’s changing

“We’re re-branding now,” he pointed out, citing a unified name change to United Capital, a tag line (“Private Wealth Counseling’) and a positioning message (“honest conversations”).

United Capital has also hired Wechsler Ross & Partners, the New York-based financial services marketing specialist and Gregory FCA Communications, a public relations firm.

In addition to working on naming, branding and messaging issues, Wechsler Ross is working on affinity marketing arrangements for United Capital with professional associations whose members can use wealth management services.

“We’ve created an affinity relationship with three groups so far and expect to have ten by the end of the second quarter,” Duran said.

United Capital’s heart is in the right place, but execution of the strategy will be key, say marketing professionals.

“Their biggest challenge to achieving national recognition is to maintain a single brand, identification and message that’s consistent across every office,” said Marla Bace, partner and chief marketing officer for Brinton Eaton Wealth Advisors in Morristown, New Jersey. and the former head of global marketing, best practices for UBS. “They can’t allow local firms to position themselves without the national name and identity.”

Rapid growth

In addition to its first major marketing push, United Capital’s goal of becoming a national wealth management brand is being fueled by a strategy the firm has pursued for five years: rapid growth.

Acquisitions have been – and will clearly remain – United Capital’s primary growth vehicle, resulting in 23 offices in nine states, but organic expansion has now also been added to the mix, Duran said.

To reach its goal of having offices in the top 25 US metro markets by 2013, United Capital is employing a three-pronged strategy, Duran said.

The firm will continue to acquire “signature” firms in major cities that have between $200 million and $1 billion in assets under management and also try to land one or two “super-regional” firms with more than $1 billion in assets.

Altogether, United Capital hopes to acquire about six firms this year, Duran said, and is focusing its efforts in Seattle and Portland, Arizona and the southeastern states.

The effort will be aided having plenty of cash in its war chest left over from a $15 million investment the firm received last year from Bessemer Venture Partners, Duran said.

United Capital’s acquisition goal is ambitious, but not impossible, said Cerulli’s Waldert.

“I think the prospects for M&A activity is a bit overstated,” Waldert said. “Sellers have been few and far between, but there are more now than 24 months ago.”

United Capital also plans to expand staffing and assets in six to ten existing offices this year by adding advisors who may be lifted out from independent broker-dealer or registered investment advisor firms.

“There are a lot of good advisors in shops with between $50 million and $200 million in assets who can’t make the economics work,” Duran said. “We can give them infrastructure, support and locations in an established office.”

United Capital is targeting two types of clients, he said: the “millionaire next door” who has $500,000 to $5 million in assets and “needs goals-based advice” and people with between $5 million and $15 million who need “cash-flow based planning” and tax, estate and investment guidance.

The firm hardly has a clear path ahead, however.

Plenty of other aggregators, advisory firms, banks and private equity firms are also on the prowl for available RIA firms in geographically and demographically desirable locations.

Quality brokers and advisors are, as ever, in high demand, and won’t come cheap.

And high net worth clients are being aggressively courted by every segment of the wealth management business from other advisors to banks, trust companies, wirehouses and multi-family offices.

“We’re very humble about this and very aware of the uncertainty in front of us,” Duran acknowledged. “We know we’re going to need some luck.”

Nonetheless, he expressed confidence that the firms who have a partnership interest in United Capital and received notes or stock would have access to liquidity in three years.

“I anticipate sending our first significant dividend to partners within three years,” Duran said.

By that time, he said, partners should be able to sell their shares internally.

United Capital may also go public, Duran said, or sell an interest to a financial institution, private equity firm or other outside party.