Welcome back to the 350th episode of the Financial Advisor Success Podcast!
My guest on today’s podcast is Jason Wenk. Jason is the CEO of Altruist, a relatively new RIA custodian that has quickly grown to serve more than 3,500 advisory firms across the country, making it the 4th-largest independent RIA custodian by firm count.
What’s unique about Jason, though, is how he built Altruist as an “all-in-one” custodian platform for RIAs that includes the portfolio management and performance reporting software that most advisory firms have to purchase separately… as Jason found while he was building his own TAMP a decade ago, the limitations of current RIA custodians made it impossible for his TAMP to build technology that would really make his middle- and back-office teams more efficient, so Jason decided to build an RIA custodian to solve that gap for other RIAs.
In this episode, we talk in-depth about why Jason built Altruist as a solution to help RIAs based on his own experience as an engineer, RIA owner, and TAMP owner, to leverage the economics being an RIA custodian in order to offer advisors their core investment systems at a lower cost, how Jason leveraged many of the programs’ infrastructures and processes he already built while he owned his own RIA and TAMP to jumpstart Altruist in the early years, and why Jason believes that the future will inevitably involve RIA custodians providing more and more of an advisor’s technology stack – for the simple reason that the economics of the RIA custody business are so strong, independent software providers may not be capable of being price-competitive with custodians in the future (and thus why so many investment software providers have increasingly been pivoting towards the managed-assets business themselves).
We also talk about how, while building his first business (a website with a low-cost monthly subscription dedicated to helping people find 401(k) solutions), Jason found that most people who needed help were retirees that needed a financial advisor which inspired him to first launch his own RIA, how Jason rapidly grew his firm and attracted hundreds of prospects per month after a client posed a question to him about a fixed index annuity which inspired him to create a blog post featuring a spreadsheet he created that calculated the internal rate of return of fixed index and variable annuities which eventually turned into an entire niche content market strategy, and why Jason was inspired to sell his RIA book of business and launch his own TAMP FormulaFolios after receiving inquiries from advisors who were interested in learning how he grew his firm to $300 million in 5 years and how they could plug into the replicable marketing processes he had built.
And be certain to listen to the end, where Jason shares how he truly believes the fiduciary standard can apply not only to how advisors serve their clients but also in how vendors serve advisors, how, even though Jason began Altruist at the age of 38 (in a world that celebrates 20-something-year-old entrepreneurs), he is grateful for the opportunities to build the businesses he did previously because it gave him the knowledge and time to be ready for launching Altruist when he did, and why, even though he has built many successful businesses within the industry, Jason is passionate about inspiring even more change and creating better industry standards, in the hopes that advisors better leveraged by technology will eventually make it so that financial advice can be afforded by anyone seeking advice… and not just mass affluent and ultra-high-net-worth clientele
So, whether you’re interested in learning about how Jason leveraged systematizing processes and finding ways to cut costs for his clients and end users to build 3 successful businesses, how Jason funded his businesses by funneling the profits he made from each business into his subsequent ventures, or how custodians make money and why Jason is adamant about bringing about change, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Jason Wenk.