Recruiting and Consulting Firm Founder Looks Back at Two Decades in Wealth Management Arena
Morristown, NJ – Speaking with Mindy Diamond, Founder, President and CEO of Diamond Consultants, in her Morristown office today is a far cry from where she started some 20-years ago. Although she fondly recalls the early days of working from her bedroom floor, “With nothing more than a pad, a pen and a phone.”
Today, Diamond is the leader of a 12-person team, which includes her husband Howard Diamond, a lawyer who serves as the firm’s COO and General Counsel, and son Louis Diamond, Executive Vice President and Senior Consultant.
“When I started the business, our sons Louis and Jason were just starting elementary school. Now Louis is the next gen of our firm and Jason also works in the wealth management industry,” Mindy Diamond reminisces.
Louis joined the firm in 2015 after several years serving as a financial consultant at Ernst & Young. The Diamonds’ goal in bringing Louis on was not only to expand the business, but to practice what they preach to advisors and firm owners about the importance of succession planning, and nurturing next gen talent.
“Louis has a strong business acumen and refined analytical skills,” Mindy stated. “He possesses a great deal of objectivity and a fresh viewpoint for our clients, as well as for our firm. And being a millennial, he fully understands the mindset of this new generation of advisors—and that’s become a real differentiator for us.”
Diamond’s business evolved from its humble beginnings at home, to a small office in downtown Chester, NJ above a pizza parlor and later a historic building just down the road from there. The firm now has two offices, one in Morristown and another in Manhattan.
The firm’s growth and evolution is due in part to Diamond’s own determination and drive, and in response to an industry that has greatly expanded, offering new opportunities for advisors.
“In the very early years of Diamond Consultants, advisors were focused on moving from one big firm to another in search of the best recruiting deal. It was much more transactional in nature.” Diamond shared. “Then things really exploded with the financial crisis. We saw an unprecedented wave of movement—in fact, more than 24,000 advisors changed jerseys in 2009 alone.”
Deals, at one time, were composed of both stock and cash tied to a 7-year forgivable loan. The financial crisis rendered most of the stock worthless, launching the onset of what Diamond describes as, “Advisor discontent and the end of blind loyalty,” as they watched some of the biggest names disappear—via attrition or acquisition.
Advisor distrust of large firms, as Diamond characterized it, was one of the catalysts that propelled the growth of the independent space—along with a shift in advisor mindset from the short-term windfall to the longer-term potential.
“While we’ve long recovered from the financial crisis, this skepticism about ‘big’ firms remains. Advisors have become more willing to bet on themselves, a sentiment that continues to grow and fuel the desire to go independent,” she said. “Now we’re seeing a total shift in advisors’ feelings about equity in a firm, because they have a seat at the table and a real stake in the success of a firm. In the case of independent firms, it’s no longer left to those in the C-suite who are typically managing to the lowest common denominator.”
Diamond noted, the thought of the biggest recruiting deal is still top of mind for many advisors, but she also sees much of the opposite. “There’s no doubt that advisors are looking at the economics, but the drivers in considering a move are not just about an outsized paycheck. They are looking for better ways to serve their clients and grow their businesses. They are looking at the potential for down the road, not just for today. Advisors ultimately want to build a legacy from their life’s work.”
Having lived through many of the biggest drivers of change in the industry – the financial crisis, the DoL Rule, and both the inception of the Protocol for Broker Recruiting, as well as the more recent decision for some firms to leave it – Diamond noted that her own firm has also gone through a metamorphosis of sorts.
“My goal for our firm became very clear: I wanted to change the way financial advisors and firms interacted with recruiters, and eliminate the sales-forward practices that so many had become accustomed to. Instead, we focused on putting advisors first by developing relationships, and providing objective counsel, information and tools, plus access to one of the most extensive networks within the wealth management industry,” Diamond stated.
It’s that “advisors first” mentality that is behind Diamond Consultants’ stellar reputation, longevity and success. Recognizing an increasing need on the education side, the firm created an annual report on the state of the industry landscape, started a blog with weekly articles and, more recently, a podcast on the independent space—the latter of which is nearing 20,000 listens since it’s inception just short of a year ago.
Diamond noted that having built what she calls her own “best business life,” she hopes to help do the same for the advisors and business owners she works with. “It was important to me to build a business where we can have the freedom and flexibility to serve our clients in the best way possible. We help them re-imagine their futures, and achieve their own ‘best business lives.’ And I’m grateful for every day that we can continue to do that.”
In looking towards the next decade or two, Diamond was clear to say, “With so much change happening so rapidly, it’s hard for any of us to predict what the next year will bring—let alone the next 10 or 20. We do, however, expect the growth trajectory of the independent space to persist, as the value that advisors place on their own potential and long-term opportunities shows no sign of weakening. And clients – who, like advisors have become far less attached to big name brands – are likely to continue to trust their advisor first and foremost. The fiduciary responsibility will become more mainstream, as advisors educate their clients on what it means for them to be able to offer a bespoke experience. And there’s no doubt that technology will play a role in the next evolution, as it has in all of our lives.”
She continued, “These are really exciting times. With a total shift in models and mindset, the evolution of the industry over next 10 years shows no sign of slowing down.”
And truth be told, Mindy Diamond shows no sign of slowing down either.