Altruist is launching a beta of a new model that gives advisors access to the compliance, custody and operational infrastructure needed to build an independent practice without standing up their own firm from scratch. Altruist plans a broad launch of the model in the fall.
The firm recently filed with the Securities and Exchange Commission to create Altruist Advisors, a registered investment advisor, and is awaiting regulatory approval. Altruist will start a beta of the program with a small group of advisors, according to Altruist founder and CEO Jason Wenk. The RIA also joined the Protocol for Broker Recruiting, an intra-industry agreement that allows advisors some leeway to take client data with them when they change firms.
“The whole purpose of Altruist is to make financial advice better, make it more affordable, make it accessible to everybody,” Wenk said. “That’s really resonated with RIAs and independent advisors in general. And one of the things that we have heard over the years is that the ease with which we’ve made launching your own RIA has really changed the lives of a lot of end clients. People are able to pursue independence and serve clients they never thought possible, and this is really an extension of that.”
Under the affiliation model, advisors would come under Altruist Advisors’ Form ADV, affiliating as investment advisor representatives under a 1099 structure. The advisor owns the client relationships and operates their own brand.
Altruist will handle all of the compliance support, including SEC registration, ADV filings, Customer Relationship Summary, code of ethics and marketing review. It also provides audit support, trade oversight, billing and access to group E&O insurance, cyber insurance and fidelity bond coverage.
Advisors also get access to Altruist’s integrated custodial platform, other relevant software and a branded mobile application. The company’s AI product, Hazel, is also integrated into the tech platform.
Wenk said the new model is aimed at advisors who want to go independent, but don’t want to deal with the operational and compliance work associated with owning their own RIA. He expects it will likely attract primarily breakaway brokers with between $25 million and hundreds of millions in assets. Advisors who have joined the beta have client assets between $100 to $250 million.
“They’re mature practices that have been operating for a number of years, and they just want to find a better platform, a better way to serve those clients,” Wenk said.
Wenk said he doesn’t believe the model competes with other advisors who use the Altruist platform; rather, it could be a pathway for advisors to eventually launch their own RIA.
“The goal here is just to help more advisors build their practices. It’s definitely not to compete with advisors using the platform as it is today,” he said. “If we can make it easy for advisors to run independent practices, that’s a net great thing for humanity.”
This follows news earlier this year that Altruist launched artificial intelligence-powered tax planning within Hazel, causing a selloff in traditional wealth management stocks.
In March, Wenk said Altruist would launch a new AI agent every quarter this year.
