Two years ago, Capital Investment Advisors found itself with more clients and prospects than it could handle thanks to regular regional radio appearances by Wes Moss. Rather than turn away business, CIA, which manages $980 million in assets, in late 2010 created a separate advisory firm, Wela Strategies LLC, dedicated to serving investors with as little as $10,000 in assets.
CIA, Registered Investment Advisory firm (RIA), is so convinced that it’s found the elusive formula to serving the mass-market customer that it is reaching out to other RIAs and offering them opportunities to collaborate with their clients. According to Mitchell Reiner, COO, “This is part of our Practice Management Partnership (PMP) business line that we are growing as well as the ETF Managed portfolio area for clients.”
In developing Wela’s business model, the idea was to use the infrastructure and research capabilities of CIA to create 10 model exchange-traded-fund portfolios for mass-market clients. In turn, Wela pays 35% of its revenues to CIA for overhead, staff, and research. This method lets CIA continue to serve its high-net-worth clients while Wela serves to “capture [mass-market] people,” says Mitchell Reiner.
By bringing on Business Development associates like Paul Scudellari, Wela has been able to attract a strong base of clients. Scudellari previously worked as a senior relationship manager at Schwab Advisor Services in the Southeast. CIA uses Schwab as its primary asset custodian.
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