In April 2024, Erik Ralston made the leap so many other financial advisors are making (or are contemplating). Along with his team, he transitioned from a successful career working for a variety of large banks to Cresset, a relatively new yet fast-growing multi-family office and independent RIA.
With more than $2 billion in assets under management (AUM) for 100 high-net-worth and ultra-high-net-worth individuals and families, Ralston and his team had established themselves as significant players in wealth management. But Ralston knew he had to make a change to truly provide his clients with the comprehensive services and unconflicted advice they expected and deserved. Client demands have evolved beyond what traditional firms can provide. They want a sophisticated family office with access to institutional-quality investment vehicles.
Below, Ralston expands on his decision-making process and what he was looking for in an independent RIA that would set his clients up for long-term success.
Erik, tell us more about the reasons you decided to make the transition from a big bank to an independent RIA like Cresset.
We interviewed 28 firms before deciding on Cresset. It sounds like a lot, I know, but everyone was reaching out and we took the calls. It was our opportunity to peek into how the industry had evolved. It was a big move, so we needed to take it seriously. Looking back, I believe more strongly than ever that we made the right decision.
Moving to Cresset was about the long-term vision of the firm, articulated well by Cresset Co-Founder Eric Becker in Barron’s. When you build a firm with your own family in mind, you build it for generations. Unlike RIAs tied to private equity cycles, which often face liquidity pressures that prioritize investors over clients, Cresset is structured for longevity.
The trend is clear: banks will be increasingly disintermediated, while advisors, and more importantly, their clients, will be better served outside of the banking environment in the future. There are too many restrictions and inherent conflicts of interest for clients to receive the unconflicted, holistic advice they need.
At an independent RIA like Cresset, advisors can act like true fiduciaries. They have access to sophisticated investment vehicles, especially in alternative investments, that banks have much more difficulty accessing and providing to their customers. Plus, banks are restricted from offering robust family office services like an actual multi-family office can. High-net-worth and ultra-high-net-worth clients will increasingly demand all those service offerings. Put it all together, and that led us to Cresset.
What are some of the specific attributes that you believe advisors should be looking for in their next firm? What are the red flags they should avoid?
Finding the best place to move your business is simple: Find a home where your clients feel you prioritize their interests over yours. Everything falls into place when clients are excited about your move. It’s a weeding process as you review lists of firms on the backs of napkins after late nights with your partners. The firms left are likely independent, if you’re still in growth mode.
At large firms, management often feels like a revolving door. The established systems provide stability, making managers’ individual contributions less impactful. Advisors at big firms can thrive simply by following the established rules and processes.
However, management is critically important at independent firms. Leadership and direction from management play a much bigger role in determining the firm’s success and culture. Finding experienced management can make all the difference. Realizing this was an “aha” moment for us.
We found that in Susie Cranston, Cresset President and COO. She hired us 10 years ago, and we’ve seen her do it. Having her at Cresset is a gift.
What makes Cresset’s independent model different from traditional banks?
From experience, advisors at many big banks and wirehouses can be highly territorial when servicing and prospecting for clients and new client assets. That internally hyper-competitive environment can make it very hard to grow an advisor’s business, plus it’s just an unpleasant culture to work in every day. As an advisor, you want to join a firm with plenty of runway to build your business, where you don’t have to be tiptoeing around other advisors or feel like you are competing with people on your team. You want to be empowered to be entrepreneurial and to feel like you are an owner of the firm. At Cresset, that is the case, and the camaraderie between advisors and our ability to build our books the way we know works best is encouraged. That is incredibly refreshing and motivating.
While often steeped in history, big banks are weighed down by outdated systems, rigid processes, and a cookie-cutter approach to client service. They’re also losing relevance as technology transforms the financial landscape. At Cresset, we’re able to move quickly on unique opportunities – something nearly impossible in the bureaucratic environment of a big bank. This flexibility means we can deliver a superior client experience and act decisively to meet their needs.
What cultural elements matter for advisor success?
Culture is critical. As referenced above, I can’t stress enough how important it is to seek out an RIA with a genuinely collaborative culture, from the top down. A healthy, productive culture is one where advisors feel free to share their opinions and ideas without risk of retribution or someone encroaching on their “turf.” In truly healthy cultures, everyone is on the same team, working toward the same vision and outcomes, and they have each other’s backs. That usually occurs only when every team member holds an equity stake in the firm. Ownership is key. Cresset is an open playing field where we can focus entirely on growing our business. This culture attracts like-minded advisors, creating a cycle of shared success and innovation.
I wanted that culture for myself and my team, and I couldn’t be happier to have found it.
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