There are nearly 16,000 registered investment advisors (RIAs) in the U.S. that need trusted stewards to help protect and manage their clients’ assets and provide investment strategies. Reliable resources are especially important for advisors managing large books of business—$1B+ in assets—and undergoing a transition, whether it’s planning for a successor to run their firm, starting their own practice, or selling their firm to a larger one. BNY Mellon’s Pershing can be that trusted steward. 

Pershing has been working with broker-dealer and RIA firm Excel Securities for the past 20 years. This year, the firm made the decision to join asset and wealth management platform Arax Investment Partners and rebrand as Ashton Thomas Securities. Pershing has been by their side for this exciting journey, helping Ashton Thomas Securities continue to serve their clients seamlessly while they enter this next chapter of growth with Arax Investment Partners, which launched two years ago to serve as a partner for advisors seeking scale, sophisticated technology and investment offerings.   

Ashton Thomas Securities’ journey is just beginning. Joining Arax Investment Partners with Pershing behind them will create even more opportunities for Ashton Thomas’ advisors, who manage over $5B in assets, and their investor clients. The firm will be accessing clearing and custody solutions from Pershing, as well as direct indexing strategies from BNY Mellon Investment Management—enabling them to tap into resources from across BNY Mellon.

To learn more about Ashton Thomas Securities, Arax Investment Partners and their decision to work with Pershing, we sat down with Arax Investment Partners CEO Haig Ariyan, a Barron’s top 10 person to watch in wealth management in 2024.

Can you tell us about the creation of Arax Investment Partners and your vision for it?  

Haig Ariyan: What ultimately led to the genesis of Arax Investment Partners was when Mike Zabik, the head of financial services at private equity firm RedBird Capital Partners, called me and wanted to know what my view was on the wealth management industry, particularly the independent space. 

At the time, a lot of private equity money was chasing independent RIAs, but they were overlooking the hybrid wealth management model—meaning investment firms that are classified as both a broker-dealer and an RIA and that can collect both commissions and fees. Much of that was due to the perceived regulatory burden that comes with having your own broker-dealer. In my view though, to discount that part of the wealth management industry means you’re dismissing some of the best financial advisors in the profession, and therefore missing out on some of the best potential clients. Mike agreed.

What resulted was the birth of Arax Investment Partners, backed by RedBird Capital Partners, which is designed to offer both a pure play advisory platform and a hybrid platform, thereby giving advisors the choice on how to grow their practices and best serve their clients. What I mean by a hybrid advisor is one that can deliver a brokerage solution as a complement to an advisor solution, such as alternative investments. 

Can you share some background on Excel Securities and why you wanted to bring them onto your platform?

Ashton Thomas Securities and the relationship with Arax Investment Partners is a reflection of “divine intervention” in the wealth management business. 

We acquired Ashton Thomas Securities, previously called Excel Securities, to create a hybrid wealth management platform specifically designed for breakaway RIA teams to have access to a full-service, well-rounded wealth management experience, inclusive of broker-dealer capabilities.

We were looking for quite some time to find a broker-dealer that was a good fit—meaning its size, culture and people aligned with our business—and that was at the right point in their lifecycle to join Arax Investment Partners and expand their business. That’s when Pershing, which I had worked with in prior positions, introduced us to Joe Lanzisera, the founder of Excel Securities, an independent broker-dealer that’s been in business since 1978.

If you go back 23 years or so, I was already indirectly connected to with Excel Securities. They were one of two dozen firms working with Alex Brown, where I was working at the time, for their clearing and custody needs. When Alex Brown was acquired, we made the decision to exit the clearing and custody business and move the entirety of that business, including Excel Securities, onto Pershing’s platform. So I couldn’t be more excited that they’ve now joined Arax Investment Partners, as Ashton Thomas Securities. We’ve come full circle, with Pershing behind the collaboration and supporting us with clearing and custody.  

It’s clear the firms have had a long and trusted relationship. What made you choose Pershing, and how do you see us helping Arax Investment Partners expand in the wealth management space? 

It's a reflection of Pershing’s culture to have a strong relationship with a family-owned broker-dealer, like Excel Securities, for two decades. Pershing has been a trusted supporter for them, readily adapting to what they needed over the years. Excel Securities started out as a pure brokerage business but has evolved its wealth management offerings to become predominantly advisory-focused. Then, to support its growth further, Pershing helped the Lanzisera family find a successive partner in Arax Investment Partners.

Pershing is particularly well-positioned to help advisors transitioning their business and leaving wirehouse firms, or full-service broker-dealers. The reason for this is because Pershing has custodied and cleared for some of the world’s largest banks’ private client business units, developing a keen understanding of how financial advisors from the brokerage world think, act and work. The backbone of BNY Mellon is also a significant positive when speaking to advisors and clients who appreciate the security and balance sheet of a custody bank.

Do you see advisors continuing to be interested in direct indexing solutions, such as what Ashton Thomas Securities advisors will be using from BNY Mellon Investment Management?

The reception from advisors we’re bringing onto our platform for BNY Mellon Investment Management’s direct indexing solutions has been quite positive, right out of the gate. To be able to put together an asset management platform, and have your custody and clearing relationship complemented with additional asset management solutions, is a real positive for us. It empowers us as we build solutions to attract independent advisors to our platform, and helps us show that, by joining us, they’re not taking a step back from having investment management solutions, but a step forward.

For advisors that may be considering transitioning and joining Ashton Thomas Securities, how can Pershing help support a smooth transition and onboarding? 

When considering making a transition, there are three priorities a wealth management leadership team worries about maintaining the most: great client advice, great client experiences, and that their advisors feel empowered by their partnership with you as a leadership team. The transition from one platform to another, and the engagement with every client and account to make that move, is a period that tests these three priorities. With the right custodian working with you during this period of transition, an advisor can create a seamless experience for clients, and remain a trusted steward.

Pershing has an evident willingness and enthusiasm to support financial advisors who are transitioning or breaking away from a wirehouse firm to an independent platform. By dedicating resources and team members to work alongside advisors during the transition, Pershing provides an extremely valuable service in what is likely the most difficult business decision an advisor will ever make.

To learn more about Pershing’s relationship with Arax Investment Partners and Ashton Thomas Securities, read the press release.