Launching an RIA, or Joining One

FAQ

Launching an RIA, answered

The questions advisors actually ask in a first conversation about independence, answered the way we answer them there. The custody question, which every client asks, gets its own piece: how custody actually works.

• Should I build my own RIA or join an existing platform?

  It depends on what you are buying with the margin. Building on a custodian directly is the cheapest structure in cash, roughly 5% to 11% of revenue for a self-assembled stack and around $25,000 to launch, and the most expensive in your time. A supported-independence platform charges roughly 10% to 20% of revenue and delivers infrastructure, capital, and speed on day one. A corporate RIA at an independent broker-dealer prices the same trade through the payout. Joining a scaled RIA or selling to an aggregator trades ownership for a firm's back office or its equity. We model all five on your book, in dollars, over ten years, and the arithmetic usually settles it.

• How long does it take to launch an RIA?

  Plan on four to nine months from decision to first trade for a de novo launch, with the registration review as the fixed clock inside it. The Advisers Act gives the SEC 45 days to grant registration or begin denial proceedings after a completed application; state registrations, for practices under the SEC threshold, average six to twelve weeks. Entity formation, ADV drafting, custodian onboarding, and technology build-out run in parallel with the review. Joining an existing platform or a corporate RIA is faster, because the registration and infrastructure already exist and the move rides on U4 and U5 paperwork.

• How much does it cost to start an RIA?

  The launch itself is inexpensive: entity formation, registration, initial compliance documents, and E&O insurance typically run around $25,000. The real cost is the operating stack and the founder's time. A self-assembled custodian-direct stack runs roughly 5% to 11% of revenue; a supported-independence platform runs 10% to 20%; the corporate-RIA lane is priced through the payout. The only honest comparison is the all-in number at your asset mix, in dollars, over ten years, and we ask every platform for exactly that.

• Which custodian should an RIA use?

  The one whose economics, service, integrations, and transition process fit your book, negotiated rather than accepted. Custody usually carries no stated fee; the custodian earns on client cash sweeps, lending, and transaction charges, so the spread on client cash is the real price. Roughly 2,000 distinct fee structures exist across one custodian's 16,000-plus RIAs, which means yours is a negotiation. We run the RFP, compare pricing models, service levels, and account-opening realities across the leading options, and negotiate the agreement on your behalf.

• Can an RIA use more than one custodian?

  Yes, and nearly 30% of RIAs now do. Multi-custody can be worth it for a practice with a large existing book at a second custodian, specialized asset needs, or clients who will not move. It also adds integration, reconciliation, and operational overhead that a smaller practice rarely recovers. We design multi-custody only where it earns its complexity.

• What is supported independence, and what does it cost?

  A platform firm that rents you a middle and back office, compliance support, technology, and often transition capital, so you can own your practice without building infrastructure. The price is typically 10% to 20% of revenue; the category flagship discloses roughly 15% all-in and a net payout near 62%. You own the practice, the platform owns the infrastructure, and the contract's exit terms decide whether you are renting infrastructure or something closer to the practice itself. Read the exit terms before the entry terms.

• Do I register with the SEC or my state?

  Generally, advisers with $100 million or more in regulatory assets under management register with the SEC; smaller advisers register with their state, with a mid-sized band and exemptions that counsel confirms for your specific situation. The choice affects the review clock (45 days at the SEC, six to twelve weeks on average at the states), the examination regime, and the compliance program you build. It is one of the first questions settled in the compliance workstream.

• Who holds my clients' money if I go independent?

  A qualified custodian, in segregated accounts titled in the client's name, under a regulatory structure specifically designed so the advisor can manage assets without ever taking possession of them. Your clients' assets sit at the custodian, not at your firm, and the custodian sends statements directly to the client. This is the most common client question in every transition to independence, and answering it clearly is part of the communications playbook.

• What is the difference between a hybrid RIA and a pure RIA?

  A pure RIA is fee-only: the firm is registered as an investment adviser and its advisors hold no broker-dealer registration. A hybrid RIA keeps a broker-dealer affiliation alongside the advisory firm, so advisors can continue to earn commissions on brokerage, insurance, or alternative products that do not fit a fee model. Practices with meaningful commission revenue usually start hybrid; practices that have already tilted to fees often go pure. The economics and the compliance burden differ, and we model both.

• Can my current firm stop me from leaving to start an RIA?

  Usually not from leaving, but the agreements govern how. If your firm is a Broker Protocol member and you follow the Protocol, you may take a limited client list and the firms agree not to sue over the departure itself. Outside the Protocol, non-solicits, notice provisions, garden leave, and, at some firms, a routine temporary restraining order in the first two weeks apply. The transition is sequenced with independent counsel around exactly these terms, and the account transfers themselves, once validated, complete in days.

• Is the move to the RIA channel slowing down?

  The headlines say so every year; the registrations say otherwise. Winthrop & Co.'s H1 2026 registered-rep data shows 13.9% of departing wirehouse advisors went to an independent RIA and 16% to an independent broker-dealer, and Cerulli projects the independent RIA channel growing to more than 56,000 advisors by 2028, the fastest of any channel. What has changed is the mix of destinations inside independence, which is why the build-versus-join decision now has five answers instead of two.

• What does it cost the advisor to work with Winthrop & Co. on an RIA launch?

  Nothing out of pocket. As with every Winthrop & Co. engagement, the destination platform or custodian compensates us on a completed transition, at no reduction to your economics; where a specific structure does not work that way, we say so before any work begins. The options review, the pro forma, and the decision to stay where you are cost nothing.