Banking & Finance and Technology

USA Financial reaching for $1B in new assets, sales this year

Ada firm increasingly embraces fintech strategy in its six subsidiaries.

September 21, 2018
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Looking back on three decades in business, the USA Financial leadership team said its expansion into the financial technology industry fits with its history of innovation.

Founded in 1988 by Gary Walters, the Ada-based firm is now helmed by his son, CEO Mike Walters, who has spent his entire career at the company and 15 years as its top leader.

USA Financial serves financial advisers and investors with products and services through six subsidiaries: USA Financial Insurance Services; USA Financial Portformulas, which has a proprietary money management platform; USA Financial Media, which offers multimedia marketing and a nationally syndicated radio show; USA Financial Consulting; USA Financial Exchange, an asset management program; and USA Financial Securities, an investment advising and broker-dealer service.

“What I really enjoy most about the industry is it’s so dynamic and always changing,” Mike Walters said. “We’ve been able to retool and redefine the company. You’d be hard-pressed to look at any five-year block and not say we are dramatically different than we were then.”

In 1998, USA Financial revamped its business model and became a broker-dealer in addition to a wholesale insurance distributor. Over time, it has branched out into additional specialties.

It now operates as a holding company with subsidiaries to better facilitate the varying levels of regulatory compliance requirements within each business.

“We continue to evolve. Although we are 30 years old, we say we are more concerned about agility and growth than size and age. We have both those sides to the business,” Walters said.

The company was on the Inc. 5000 list of the fastest-growing private companies in the U.S. 2014 through 2017 — a feat Walters sees as unusual for a company that isn’t a startup.

With more than $6 billion in new assets since 2008, it has seen more than 15,000 account transactions in the past three years, leading to a 73 percent revenue increase, and Walters expects the firm to do $1 billion in new assets and sales this year.

He attributes the growth to the firm’s “technically astute” team of 75 employees.

Walters and COO Matt McGrew said they strive to offer the best solutions possible to support their clientele of 370 advisers, who in turn assist investors nationwide.

The firm’s definition of “solutions” has evolved over the years and isn’t just limited to trading software.

McGrew said the biggest changes on the tech front have happened within the past 11 years, with the hiring of Greg Lockwood, chief technology officer.

Lockwood and a team of contract developers created an internal proprietary system that allows the firm to manage regulatory compliance, and track and aggregate all its client and business activity in one place.

“It started there and evolved,” McGrew said. “We saw we had the opportunity to bring that into our CRM (customer relationship management tool). … In the past, we were using multiple systems that didn’t talk to each other. There was no scale, and we couldn’t leverage the pieces to form a cohesive whole.”

USA Financial created the Financial HQ Technology suite that brought marketing technology, business management, compliance and client tools together for the firm.

Within the suite, the Financial HQ Advisor Dashboard allows adviser clients to access all of those areas, as well.

Up until about five years ago, USA Financial offered advisers access to a slate of third-party technology vendors that didn’t interface — and which clients rarely used.

McGrew said advisers’ feedback indicated too many options make for an overwhelming experience. They wanted something simple and streamlined.

“We talked to advisers … took that input and went to the best tech experts in the industry and said, ‘How do we make this integrated, streamlined and offer services to advisers they weren’t getting before?’” McGrew said. The result was HQ Advisor.

Last year, USA Financial rolled out its latest tool for business management, straight-through processing, an all-electronic system for opening accounts and submitting forms using an e-signature vendor to handle delivery of signed documents.

This allows the firm’s adviser clients to work with their investors 100 percent remotely, if they choose, giving them access to a wider clientele.

One of the most tech-heavy divisions at USA Financial is the media subsidiary. The firm’s campus is split into a west building and an east building. The latter houses a seminar training system/room and video and audio studios used for production of the company’s nationally syndicated USA Financial Radio Show and its multimedia marketing products.

“When an adviser joins us, we can take over all their digital footprint and social media, public events, client appreciation and proprietary technology,” Walters said. “They can take advantage of all of that or just to the level they want.”

The media division offers clients an array of “Plug-n-Run” marketing tools, including email marketing, lead generation, branding, e-newsletters and a mobile messenger tool. The latter was created to ensure mobile communications between advisers and their clients are “compliantly” archived.

“What’s hard with texting software is it’s usually going just to the financial advisers’ phones. If there’s information going to a client, it needs to be supervised regulatorily. This software allows those texts to be provided back to our firm while still allowing advisers and clients to text,” McGrew said.

He added clients of the financial consulting division receive help adopting the firm’s various technology offerings into their practice if they so choose.

“I’ll steal a line from Mike,” McGrew said. “We’re treating tech as another employee. If there’s tech we can adopt that leverages our employees to spend time more wisely and efficiently — those are the things we’ve latched onto as a firm.”

Walters said the rapidly changing regulatory environment makes tech innovations necessary for the firm to stay ahead of the curve when laws change. It means defining the firm differently these days.

“We are a tech company that happens to be in the financial services industry,” he said.

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