June 22, 2020
Mindy Diamond Featured
By Jake Martin
Mindy Diamond stood to collect a hefty fee from yet another big deal that was cruising toward completion, and her stomach was in knots.
The principal of an independent advisory firm managing $1bn or so in assets was deep into the process of selling his business to a larger shop, in the $3bn-$4bn AUM range. Diamond was shepherding the seller through the transaction.
‘Both sides loved each other and things were moving forward with rapidity, and for all the right reasons,’ Diamond says. ‘Then, three-quarters of the way in, I started to get a bad feeling. I just didn’t like some of the answers I was getting.’
Afraid to lose out on a nice payday, Diamond also couldn’t ignore her gut. After all, many financial advisors mulling a move to a rival firm or a shift to another channel altogether choose to outsource much of that gut-checking work to firms like Diamond Consultants.
Diamond had long before secured her New Jersey firm’s reputation as a recruiting and consulting powerhouse in both the wirehouse and independent advisory worlds.
Despite her clout in the industry, that doesn’t always mean a client is waiting for the privilege to be told what they don’t want to hear from her.
That stomach-turning deal, now dead for seven years, would have surely closed without her intervention, she says.
‘The seller was not aware of any of the sort of vibes I was getting,’ Diamond says. ‘But I told them, “Look, I’m going to be really honest with you. In the end, you should do what you want, but here are some things that are really bothering me that I’d like for you to address with the buyer.”’
The idea went over like a lead balloon. The seller was angry with Diamond, and Diamond went home that night feeling horrible, wondering if she did the right thing.
‘In the end, the buyer blew himself up and showed his true colors,’ Diamond says. ‘My instincts were right and the deal didn’t happen. But to stand by your convictions, trust your instincts and be authentic is not always the most popular stance.’
This ‘non-transactional’ approach, Diamond is the first to admit, is intentional. It has served her well over the course of Diamond Consultant’s 23 years in business.
‘I don’t mean to paint myself as Mother Teresa,’ she says. ‘I’m a capitalist, I’m a dealmaker who loves making deals, I’m not running a charity. But I’ve figured out how to run a business that is both authentic and good and does very well.’
Before her recruiting career, Diamond spent two excruciating years as an accountant.
‘I was the most ill-suited accountant there ever was,’ she says. ‘As much as I hated accounting, that’s how much I took to recruiting and how much I loved it.’
It was actually a recruiter who suggested to Diamond that her skill set and personality might be better suited for recruiting. Within just a year on the job, at 25, she was the top recruiter at a national firm. She spent seven years recruiting in the accounting field before leaving to become a ‘full-time mom.’
A few years later, with just an inkling that she was ready for work again, Diamond learned from a friend who, at the time, managed one of Morgan Stanley’s flagship offices that there was a dearth of good recruiters in wealth management. After some lobbying by her husband, Howard, and friends, Diamond began to build what would become Diamond Consultants on her bedroom floor.
Calling herself an ‘accidental entrepreneur,’ Diamond says that she was apprehensive in the early years to let her recruiting ‘hobby’ grow into a real business. But that mindset didn’t keep her from diving into the space and learning the language of advisors.
The Diamonds’ friend from Morgan Stanley, Ed Friedman, who is now the head of business development and growth at $3.4bn RIA Summit Financial, served as Diamond’s coach and mentor when she was getting started.
‘I would call up an advisor at Merrill Lynch, let’s say, and talk to them, and they would use words or terms I didn’t know, and I would write them all in a notebook,’ Diamond says. ‘At the end of every day, I would call Ed and ask, “What’s a structured product? What’s a derivative? Why does it matter?”’
Diamond says Friedman was her Wikipedia before there was a Wikipedia. ‘That’s really how I learned to ask the right questions of advisors and figure out what they were thinking or what they were frustrated with,’ she adds.
Beyond learning the lingo and the nuances of the advisory space, there was another big hurdle to tackle.
‘I had been trained as a transactional recruiter, meaning you talk to a candidate with the goal of looking to move them,’ she says. ‘That just didn’t feel right to me at all.’
Instead of calling an advisor and trying to pitch them on ‘some hot opportunity’ with Morgan Stanley, for instance, Diamond started asking them questions about what was missing from their careers and what they wanted out of their business lives. Those kinds of questions became the cornerstone of Diamond’s consulting process, which she calls the self-assessment.
‘It’s a list of really smart, thoughtful questions that we ask advisors to give them clarity about what their best business life looks like, whether that be to stay put, where I don’t get paid, or to make a move,’ Diamond says. ‘My goal is not to move them – my goal is to add value.’
Diamond’s starting point, she says, is to find out if there’s enough pain or frustration inherent in what they’re doing that a move is justified, and if there’s enough of a pull to another option that would be ‘better enough.’
‘If the answer is no, or maybe, they shouldn’t move,’ she says. ‘Moving is a hassle. We spend as much time talking people into staying put, not moving, as we do moving.’
Diamond, born in Jersey City, NJ, learned a lot about business from watching her father, who ran an industrial cleaning business.
‘From an early age, I saw competence, I saw entrepreneurial thinking, and I saw him being scrappy and smart,’ she says. ‘It was a family business he owned, and it had been handed to him, but he really grew it from a small business into a big business, and then ultimately sold it.’
Diamond’s approach to business, however, has veered far from how her father ran his.
‘I think I learned my approach to relationship management from doing the exact opposite of what he did,’ Diamond says. ‘His approach was a very sales-y, transactional approach.
He approached it the way I was taught to recruit when I was recruiting accountants: that every prospect is a dollar sign and a deal in the making.’
One of her early role models was her maternal grandmother, who ran a women’s and children’s clothing store in Jersey City.
Diamond’s grandmother was the youngest of 12 children, an immigrant from Russia, and not college-educated. Her husband, Diamond’s grandfather, was a hosiery salesman who suffered from mental health issues and ‘sort of fell apart’ after the stock market crash of 1929.
‘My grandmother really stepped up and turned what was this little hosiery business into an enormously successful women’s and children’s clothing store,’
Diamond says. ‘Her story taught me that a woman could succeed and could be more than just a housewife. I learned that I could be a mother, wife and businesswoman, and that I didn’t have to sacrifice one for another.’
Bigger and better
Three years into her own business, Diamond was still working on her bedroom floor. Pleas came with increasing frequency from her husband Howard to consider moving her office into the basement, but Diamond wasn’t ready to commit to making what she still thought of as a hobby into a business.
Eventually, she capitulated and moved shop downstairs.
‘I began to realize I was getting calls from all over the country, not just from advisors who wanted to move, but from managers within Morgan Stanley and other firms that wanted me to recruit for them,’ Diamond says. ‘I couldn’t handle it on my own anymore, so I put a teeny, tiny, little ad – the only size I could afford – in the local paper, and found three women who still work for me today.’
About 10 years or so into the business, Diamond’s husband, a lawyer, left the practice of law to help her manage Diamond Consultants. He’s now the firm’s chief legal counsel and chief operating officer. About five years ago, they were joined by their son, Louis, who is working to further professionalize the firm and build out its mergers and acquisitions business.
Having long ago left the basement, Diamond Consultants now has 14 employees and offices in Morristown, NJ and New York City. At age 57, and turning 58 this summer, Diamond says she has no plans on slowing down.
While its origins may have been ‘accidental,’ Diamond’s business has found solid ground just by doing ‘the next right thing’ each step of the way, she says. That didn’t make the mountain she had to climb any shorter.
Diamond says she was ‘hugely intimidated’ when she started recruiting for financial advisors, as the industry has always been male-dominated.
‘Not only was I a woman, but I was young,’ Diamond says. ‘I definitely didn’t have the confidence I have today, but being a woman really helped me because it has given me a certain emotional intelligence that I think is critical to being a good recruiter.’
Diamond says she only advises people the way she would want to be advised and that some people may choose to work with her and others may not, whatever their reasons.
‘I’ve earned my place in the industry, not because I was a woman in a man’s world, but because I was good at what I did,’ she says.