The PLANADVISER Interview: Vince Morris, President of Retirement and Wealth, OneDigital

OneDigital Investment Advisors LLC, a division of insurance aggregator OneDigital, made its fourth acquisition of 2023 in June when it added the $3.8 billion retirement wealth shop StoneStreet Equity.

To some firms, that may seem like a robust M&A calendar. But for OneDigital, one of the handful of aggregators in the employee benefits space, it’s a relatively normal cadence in its strategy of building a national network of workplace benefit offerings.

About three years ago, Vince Morris joined OneDigital from his own retirement and wealth advisory practice, Resources Investment Advisors. Back then, OneDigital boasted 50,000 customers across the U.S. Now, in part due to acquisitions within Morris’s division, it has more than 100,000.

But OneDigital is not alone in its strategy of employee benefits, with numerous competitors also building through a combination of acquisitions and organic growth. That, combined with higher interest rates, market uncertainty and an industry struggling to cultivate future talent, all create various headwinds for aggregators.

Morris, however, is bullish on the longevity of the team being built at OneDigital. PLANADVISER spoke with him about continued acquisitions, the retirement and wealth convergence and how OneDigital’s mission has developed over time.

PLANADVISER: We regularly cover your acquisitions in wealth management and retirement. What do you look for in bringing on firms?

MORRIS: Enterprise-wide, our growth strategy centers around establishing fully formed markets [with our businesses]. Take Boston, for example. We had a really great team of employee benefits and human resource consultants there. Subsequently, we augmented our capabilities by integrating TimeScale Financial, a group that brings about 80% wealth management and 20% retirement expertise. Furthermore, we have extended our offerings to include property and casualty services, completing the creation of a comprehensive and converged market. While each area maintains its practice-specific reporting structure, they function seamlessly under a unified leader.

PLANADVISER: We talk a lot about retirement advisement moving into wealth management for participants. How do you track that business progress in real time?

MORRIS: As we are still in the early stages of integrating various components and expanding into diverse markets, we maintain a strong focus on communication and collaboration. Regular leadership calls and board of director meetings are held, fostering a synchronized flow of information throughout the organization. This allows us to proactively address and solve client challenges through cross-functional problem-solving initiatives. To us, there is [a return on investment] back to the company to take care of their employees in a different way. Companies are more challenged now than ever, for talent, for retention, for all of those things—and that’s a demographic issue. It’s not going away tomorrow. This labor market is not going to soften; this is going to be a long-term thing that companies are going to have to figure out.

Our role is to act as a trusted business strategy consultant, providing support and solutions tailored to each client’s unique pain points. When engaging with businesses, we seek to identify areas of concern or HR challenges. Armed with this insight, we assemble the necessary resources to address these issues effectively. Whether the challenges pertain to retirement planning, nonqual (non-qualified) plans, property and casualty risk management, employee benefits, or any other pertinent aspect, our mission is to comprehensively cater to their needs and empower them from an engagement perspective.

PLANADVISER: What makes you confident in the strategy of bridging retirement and wealth?

MORRIS: I think that there’s a proven track record. Take my legacy team out of Kansas City, where about 70% of our team focused on wealth management and the remainder on retirement. Our wealth teams engaged with participants, resulting in improved retirement outcomes. Through their genuine dedication and willingness to assist individuals, the advisors established long-term relationships that extended beyond retirement planning into comprehensive wealth management. We know that that works, boots on the ground, one-to-one.

Now we’re trying to be a little bit different by asking, ‘How do we scale that in a different way?’ … This direction aligns with the trends we observe in independent surveys and from the feedback of employers and employees alike. There is a resounding demand for financial advice provided through employers, indicating a shift in preferences towards more holistic benefits packages that encompass more than the conventional offerings.

People want advice, and employers want to attract and retain people with more of a benefits package than just the normal traditional benefits package. We think financial advice is one of those components that will be key in the future in order to take care of key employees and high performers. Oftentimes, these are people that really don’t take care of themselves; they run hard and work hard. They’ve got families to take care of and 20 different things that are pulling them in different directions. For us to be able to come in and give them focus actually provides that ROI back to the company. Because now they’ll be more secure, more stable and thinking more about the growth of the company than their own personal financials.

PLANADVISER: Each aggregator has its own flavor. What do you look for in acquisitions to ensure you are getting the right fit?

MORRIS: From our point of view, if we look at 10 deals, we maybe do one. We’re very selective, and we always want to have our culture aligned. I know that’s a little bit cliché. But as our Chief Growth Officer Mike Sullivan would say, who we let in the front door is just as important as who we don’t. And a lot of that culture is driven by our vision and our mission. We’ve got to have those things aligned.

A pivotal benefit that a wealth adviser would discover upon joining our ranks is the advantage of our close proximity to employers. This access enables us to provide invaluable assistance to both employees and the employer itself, especially in the small market business space where we actively engage. Frequently, business owners in this segment hold illiquid stock as their primary asset, tied to their company. In such cases, we offer valuable guidance, helping them navigate illiquidity concerns and plan for future liquidity events. Concurrently, we emphasize the significance of caring for their employees’ financial well-being.

Where we see it is that there is flexibility in the marketplace for an adviser team to come in. We want to centralize those aspects that we can take advantage of. If we can free up, say, 400 hours a year in investment reviews and management of the business and things like that, then that’s 400 hours that advisers can take to draw more organic growth for themselves. That’s what we’re trying to do. We’re trying to figure out what is critical to the business that needs to be managed at the local level, like the client experience, versus, what would be centralized and operational that can help accelerate growth across the enterprise.

PLANADVISER: Now that you’ve been growing for a few years and adding to the business, have any firms decided to go their own way?

MORRIS: I would say that, since the original team started to get into the M&A game, so say 2010, we’ve had very few firms leave. It’s not zero, but it’s not 5% either. It’s a very small amount. I give credit to the people who came before me—the Mike [Sullivans] and Adam [Bruckmans] of the world that really held their course to the culture side of things, saying, ‘Hey, you know, you really have to be aligned with what we’re going to do.’ I think a lot of those bumps and hurdles that always come up through transactions and transitions will fall off to the wayside and get resolved because you’ve got alignment.

Now, with the founders group that I came on with in January of 2020, you’re absolutely right, we’re all off of our earn out; we’ve got maturation now in the business. But I would challenge you to ask any of the other advisers how they’re feeling, and I think they’re having more fun now than they’ve ever had in their life. We are collectively coming together and building something. Whereas before, when we were an affiliate model, we talked about being together, but we still ran our own companies. We weren’t really together and challenging each other and growing. And now we have that sense of purpose. I think that will keep people here. If the culture lacked and they didn’t like it, yeah, I think they would just take their paycheck and go. But that’s not what we’ve built here.