Written by: Javi Otero
Should I Start an RIA or Join an Existing One?
The path to independence is a popular one, and many advisors will consider the appropriateness of the RIA model for themselves at some point in their career. When an advisor considers that model, they’re often basing decisions on things like custodial partners, technology vendors, and marketing/branding. These tactical decisions, while important, should really be considered as Step 2 in the due diligence process. Step 1 involves a much more foundational question:
“Should I start my own RIA or join an existing one?”
The answer to this question really depends on the kind of business – and life – you want to build. It’s not just about how quickly you can make the move, or which firm has the best tech stack. It’s about establishing ownership, autonomy, liability, support systems, scalability, and ultimately – your legacy.
As a transition consultant who’s spent years in the trenches, involved in hundreds of transitions, I’ve witnessed advisors achieve immense success with either path. On the other hand, I’ve also seen them falter – not because one route is objectively better than the other, but because the advisor made a choice based on short-term convenience factors, rather than long-term alignment. Decisions made to optimize ease and speed don’t always reflect a full scope of understanding.
In many cases, the lure of freedom that comes with building something from scratch is strong – being able to make the rules and have full ownership and the ability to create a customizable image. In other cases, an individual or team is best served by plugging into an existing framework and being able to focus on serving clients without the hassle of compliance workflow management or operational infrastructure.
If you’re asking yourself whether you should start an RIA or join an existing one, you are not alone. It’s one of the most common, and consequential, crossroads an advisor could face in their career.
In this article, we break down the pros and cons of both options, compare key considerations, and help you determine which path makes the most sense for you.
Start an RIA
Starting your own Registered Investment Advisor (RIA) firm is the purest expression of professional independence in the financial services industry. It’s a blank slate — your brand, your people, your processes, and your future. Advisors who choose this path will essentially control all ownership, opportunity, and responsibility for a brand new firm.
Why It Works:
- Full Ownership: This isn’t just a branding decision — it’s an equity one. By starting your own firm, you retain 100% of your enterprise value. Over time, that can translate into significant upside if you ever choose to merge, sell, or bring on partners.
- Freedom of Choice: You’re no longer locked in to a limited tech stack or investment menu. You choose the custodian(s), fintech integrations, legal/compliance vendors, and everything in between. This freedom enables you to build a business that works for your clients and you.
- Cultural and Brand Control: You get to decide what the firm stands for, how it looks, how it feels, and how it operates. From client onboarding to internal meetings, you set the tone.
- Exit Flexibility: Whether your goal is a future internal succession plan, third-party acquisition, or private equity backing, the business is yours to scale and sell — or not. The terms are yours.
- Personal Fulfillment: Many advisors find a deep sense of satisfaction in creating something from scratch — a business that reflects their values, vision, and leadership style.
Why It’s Not for Everyone:
- Compliance & Legal Setup: You’re starting from zero. That means creating and filing your ADV, drafting client agreements, and becoming your own CCO or hiring one. The process is manageable but intensive, and not something to take lightly.
- Startup Costs & Time: There’s no sugarcoating it – starting an RIA can be expensive and time-consuming. Your budget will include legal fees, E&O insurance, CRM and performance reporting software, payroll, office space, and much more. Expect a minimum runway of 3-6 months of planning before launch.
- Building the Infrastructure: Billing, reporting, client service workflows, and cybersecurity protocols don’t create themselves. You either build it all or hire people to do so for you.
- It Can Be Lonely: Advisors who are used to a team or home office support system can feel isolated at first. You must create your own network and surround yourself with strategic partners, consultants, and mentors who can fill that gap.
- The Pressure Is Real: Early-stage business ownership means wearing every hat: CEO, COO, CMO, CCO. The emotional and financial pressure can be intense, especially if you’re the primary revenue driver.
Despite the obstacles, for the right advisor — typically someone with a clear vision, strong operational instincts, and a desire to build something enduring — starting an RIA can be a deeply rewarding move.
Join an Established RIA
If the idea of building from scratch feels daunting, there’s an easier path: plug into an established RIA that’s already done the heavy lifting. This route offers many of the benefits of independence, without the stress of launching a business solo.
Why It Works:
- Built-In Infrastructure: You get to focus on what you do best while the RIA handles the rest. Things like compliance, billing, trading, reporting, HR, and admin support.
- Faster Revenue Ramp: With most of the operational setup done for you, client onboarding and cash flow tends to happen faster. Advisors could be fully transitioned and billing within 30–45 days.
- Lower Financial Risk: You’re not footing the bill for every tech license, legal document, or custodian negotiation. Most costs are absorbed by the parent firm or deducted from revenue over time.
- Shared Resources: Many firms offer internal marketing, training, paraplanning, and business development support — assets that would otherwise cost money out of your own pocket.
- Peer Community: You’re not going it alone. Established RIAs often offer formal and informal networking, study groups, and mentorship across the firm.
What to Watch Out For:
- Limited Customization: Some RIAs limit your ability to choose tech, branding, or portfolio strategies. You may be working within an existing framework rather than creating your own.
- Payout Trade-Off: While you avoid the startup costs, you settle for a reduced payout or revenue split. Some firms offer equity or profit-sharing, but there is no guarantee.
- Cultural Fit Is Critical: The wrong firm can be worse than staying put. Advisors need to vet their partners carefully — develop a comprehensive understanding about firm values, investment philosophy, decision-making authority, and internal dynamics.
- Restrictions Still Exist: Even as an IAR, you may encounter limitations on investment menus, fee structures, or client types. Independence is often relative in these environments.
- Building Someone Else’s Enterprise: You’re part of a larger organization — in some cases, that means adding value to their brand, not your own.
That said, for advisors who are more client relationship oriented — and who want to grow without grinding through logistics — joining an existing RIA can be a wise and highly profitable move.
Key Comparison Matrix
See our visual breakdown of how the two options compare across key categories. Or download the PDF version HERE.
So… Which One Is Right for You?
The answer is, it depends on your priorities — not just now, but in the future. The decision is less about where you want to work and more about what kind of business owner, leader, and lifestyle architect you want to become.
Ask yourself:
- Do I want to build a firm, or focus on what I do best?
- Is control more important to me than convenience?
- How much risk am I comfortable with taking?
- Do I thrive in autonomy, or do I perform better with a support system?
- What’s my long-term exit strategy — and who controls it?
This is where the rubber meets the road. One path may be faster, one may feel safer, and one may offer more flexibility — but neither is inherently better.
Some of the most successful advisors I’ve worked with took a phased approach. Initially, joined an existing RIA to de-risk the transition and learn the operational ins and outs, then launched their own firm once they had the confidence and infrastructure knowledge to do it right. Others started building from day one and never looked back. They had a crystal-clear vision, the resources to support it, and the appetite for full control.
What mattered most wasn’t the route they chose. It was that they made the choice intentionally based on alignment with their values, goals, and preferred way of operating. The advisors who struggled most were the ones who underestimated the responsibility that came with freedom, or who joined a firm that promised support but fell short in their delivery.
If you’re wrestling with the decision, you don’t need a sales pitch. You need a sounding board. Someone who can outline the reality of your situation — not the brochure version.
It’s not just a business decision — it’s the foundation for the next chapter of your career. The systems you build (or plug into), the equity you retain (or give up), and the flexibility you protect (or relinquish) will shape everything about your future: your workday, your income, your succession plan, your stress level, and your legacy.
Need help assessing fit? At Advisor Transition Services, we help advisors navigate the chaos, evaluate the right partnerships, and launch with confidence.
Reach out. Let’s make sure your next move is the right one.
