What do you think is the industry's biggest challenge? TASH ELWYN: For the past five-plus years, the industry has certainly grasped the challenge of the aging demographics of the client base. But the challenge now is the demographic challenge related to the advisor population. In several large markets, as an example, well over 50% of our revenue in those markets is coming from advisors over the age of 60. Many of our competitors have embraced a strategy in which the succession-planning documents that they have created to help a retiring advisor monetize some sort of equity in this business, and have an earn-out over a period of years, are written in such a way that in most cases, the successor FA is signing to an agreement that will trump Protocol. Protocol, as an agreement between Protocol member firms, is effective so long as there's not a superseding agreement that an FA has voluntarily signed. A team agreement, for example, would trump Protocol. A personal thesis that I have is that over the next five to 10 years, as you begin to see this massive transition of business from the retiring generation of advisors to the next generation of advisors, that next generation of advisors will knowingly, or unknowingly, be signatories to an agreement to a succession plan that will forever preclude their choosing to conduct that business elsewhere.
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