Adam Malamed Reflects on First Year as Sanctuary Wealth CEO

Taking over leadership of a big advisory firm is never an easy task, especially when the appointment comes after the predecessor’s unanticipated departure. But it does help the transition when the new CEO is already a board member with three decades of leadership experience.

That’s how Adam Malamed, CEO at Sanctuary Wealth, assesses his initiation into the job one year ago this week — after Jim Dickson, the firm’s founder, was dismissed by the board of directors over misconduct allegations.

“Sanctuary is one of the leading growth companies in the wealth management space,” Malamed said in an interview with ThinkAdvisor. “When I was approached a year ago about taking on leadership of this organization, Sanctuary just had a bunch of necessary ‘check-the-box items’ for me. I wanted to be a part of something that I could really sink my teeth into and help to put on that next stage of growth.”

As Malamed discussed, the years ahead represent a critical juncture for the wealth management industry. For starters, there is a veritable explosion in demand for the services of both advisory and brokerage professionals. Plus, clients want more options and more value for their fees, while advisory firms are facing big questions about their business models, compensation structures and succession planning.

This outlook spells long and busy days for Malamed and his leadership team — but that’s how he likes it, especially after spending a few years away from the industry after his exit from Ladenburg Thalmann following its acquisition by Advisor Group in 2019.

“My wife would probably tell you that I’m happier now that I’m working big days again,” Malamed said. “You can only spend so much time fishing or skiing before you need to be fully engaged again.”

Here are highlights of our recent conversation:

THINKADVISOR: What’s like to be tapped to take on the leadership role for Sanctuary at what must have been a bit of a disruptive time for the firm?

Adam Malamed: I think the best way to talk about that would be to start with some of my own background and my prior experiences in leadership.

I started in the wealth management space 30 years ago now. I started as an advisor, but I always knew I had that entrepreneurial spirit and ideas of management — ideas of owning and running businesses. So, I had started my own brokerage firm in 2002, and by 2006 I had my first big opportunity in partnering with Ladenburg Thalmann, where I became a director and their chief operating officer.

I took on that role at an exciting time, too, when they were looking to deploy capital where there was big growth opportunity in the independent wealth management space. Remember, this was back before it was cool to be independent. It was almost viewed as a fad that would fade away.

We knew that perspective was a mistake, so we started making those acquisitions, and we built tools around the advisors to allow them to enhance and grow their practices — to build real enterprise value in their business. That vision was validated in the sale to Advisor Group, when we had achieved $200 billion in assets and a $1.3 billion valuation.

Fast forward three years to late 2022 and I had spent a lot of time skiing and fishing, but I had also been introduced to Sanctuary Wealth through one of their capital partners. They asked me to join the board, and I got to learn all about the senior leadership team, the partner firms and the platform.

Given my prior experience, I knew immediately that Sanctuary had a bunch of check-the-box items for me. I knew this was something that I could sink my teeth into and which we could really grow and institutionalize.

That’s what we have had our focus on for the last year, and we’re seeing amazing success. We’re at $30 billion in assets and we have 85 partner firms and growing, predominantly from the breakaway space. It’s been a great year.

Why do you think many wirehouse advisors continue to express interest in breaking away?

There’s a lot to talk about here, but the thinking isn’t exactly new. You may remember that all the way back in 2012, Cerulli Associates came out with a special report that projected headcount in independent channel would likely surpass the wirehouse channel by 2018, and that actually did happen. It caused many people in the wirehouse space to take a pause and rethink their perspective.