Jim Dickson, the founder and former CEO of Sanctuary Wealth, has resurfaced with the launch of Elevation Level, an funding agency he says will take minority stakes in RIAs with $200 million to $3 billion in consumer belongings and assist these corporations develop. Dickson has partnered with Mark Penske, founder and chairman of United Atlantic Capital, a privately-owned monetary providers holding firm, on the brand new enterprise.
“I had a 12 months off to check the enterprise,” Dickson mentioned in an interview with WealthManagement.com. “And the problem that I had with the aggregation house is, a number of the advisors will promote their observe after which try. They’re achieved; they’ve offered it. We have been in search of extra alignment.”
Along with the launch, Elevation Level has agreed to amass Mount Yale Capital Group, an RIA and Outsourced Chief Funding Officer with $3.4 billion in belongings underneath administration. John Sabre, CEO and managing companion at Mount Yale since 2003, will change into govt chairman of Elevation Level. The transaction is anticipated to shut this month.
Whereas Mount Yale will stop to exist as a model, its ADV will function Elevation Level’s company RIA for future offers. Mount Yale will present the middle- and back-office enterprise features to help advisors. Advisors that be part of Elevation Level can have the choice to come back underneath its ADV or use their very own registration.
Dickson mentioned they agreed to purchase Mount Yale as a result of they wished to have the infrastructure in place early on.
“I constructed the airplane whereas flying it as soon as; I did not wish to try this once more,” Dickson mentioned, referring to his earlier effort launching and working Sanctuary Wealth. “These 40 folks at Mount Yale gave us a direct again workplace, gave us a direct chassis of which to function with, a clear ADV and actually skilled folks that we might scale and get to market shortly.”
Elevation Level was launched by an oversubscribed funding spherical from a mix of household workplace traders and a few debt capital, Dickson mentioned. He declined to say how a lot was raised or which household places of work participated.
Dickson, a former Merrill Lynch govt, launched Sanctuary Wealth in 2018 as a supported independence platform for advisors popping out of the wirehouses. It grew quickly underneath his management right into a nationwide community of unbiased wealth managers, with $27 billion in belongings and 300 advisors throughout 28 states.
However in a shock transfer final February, he was abruptly changed as CEO by Adam Malamed, a former Ladenburg Thalmann govt and member of Sanctuary’s board of administrators.
Dickson declined to say why he was terminated apart from to counsel he and his traders on the time had competing visions for the agency. “I feel we simply had a distinct compass,” he mentioned. He stays the most important non-institutional shareholder of Sanctuary. “I am actually centered on the windshield, not the rearview mirror.”
A Sanctuary spokesperson mentioned, “As we said in February 2023, Jim Dickson was terminated for trigger by the Board, and past this, Sanctuary has no remark.”
Talking on the MarketCounsel Summit in Las Vegas final December, Dickson mirrored on his time at Sanctuary, particularly his battle to steadiness the speedy development of latest advisors becoming a member of with sustaining service to current ones and the pitfalls of taking up capital companions.
He’s trying to construct one thing totally different with Elevation Level and keep away from a few of the rapid-growth points he grappled with at Sanctuary, he mentioned. Elevation Level is not going to be an aggregator nor a turnaround store, however somewhat an “accelerator,” partnering with advisors to assist them acknowledge and improve their distinctive worth propositions and develop by eradicating operational constraints.
“This time round, for me, I did not wish to be a platformer,” he mentioned. “I wished to be a companion.”
Within the years since he launched Sanctuary, many corporations have adopted that mannequin and entered the enterprise of investing in RIAs and serving to launch unbiased practices.
“However what you discover once you begin to look underneath the covers and see the enterprise, all the worth they add is within the first 12 months,” he mentioned. “And we wish to be any individual that provides worth by the lifecycle of that companion agency, and candidly, we additionally consider that having an ecosystem of those corporations which have comparable traits and have a steady of subject material specialists that we will herald, we will speed up them.”
Elevation Level will assist advisors discover expertise, broaden advertising and marketing methods and formalize enterprise growth. For example, it is going to assist the advisors hone in on a related consumer area of interest or service providing.
The agency may also present expertise. It’s at present working with CRM supplier PractiFi and knowledge reporting supplier Addepar as its major tech companions. Elevation Level will probably be open to all custodians.
The agency will take a minimal 20% stake within the RIAs it invests in. It is not going to have a dealer/seller.
They may also be launching a personal funding community known as Alt:62, to provide companion corporations and their shoppers entry to non-public funding alternatives that come up by the household workplace companions. Among the household places of work that invested in Elevation Level have been occupied with co-investing in these alternatives with its companion corporations, Dickson mentioned.
He doesn’t see it as pushing proprietary merchandise, and it isn’t deliberate to be a revenue middle for the agency. That will embody investments in movie rights, mineral offers and small- to medium-size non-public companies.
“We’re that as a development engine for our monetary advisors to be a matchmaker or a connector to distinctive alternatives that’ll actually differentiate them within the market,” he mentioned. “These aren’t issues you possibly can simply discover in all places.
“We will let the advisor drive that course of and drive that call, which we expect is de facto, actually totally different,” he mentioned. “However I feel it could be a mistake if we had that capacity to attach into these alternatives and we did not allow them to make the choice.”
