Introduction: The Road Ahead

There’s a certain romance to setting out on your own, whether it’s a road trip across the country or starting your own RIA firm. Both begin with a similar feeling: excitement mixed with uncertainty. The map isn’t always clear, and the road is bound to have its twists, but hey, that’s what makes the journey yours. With the right tools and a clear plan, you’ll go far. Let’s map the plan and hit the road!

 

Start a Registered Investment Advisor Firm In 9 Steps

 

Step 1: Get Licensed—Your Driver’s Permit for the Financial World

Passing the Series 65 Exam is the first step in the whole process, since it grants you the legal right to offer investment advice, which is obviously vital for an RIA. It’s similar to a driving test for the financial industry: covering fiduciary duties, investing methods, and securities rules.

With a 72% pass rate, preparation is critical. Plan to dedicate 60–80 hours of study time. Tools like Kaplan and Achievable can help break the material into manageable sections, especially the heavily weighted ethics component.

Already hold a Series 7 license? There’s also the Series 66 exam available for you, which combines the 63 and 65. Review the NASAA rules since each state has its own set of standards. It’s similar to brushing up on local traffic laws before your road trip!
 

Step 2: Register Your Firm—Putting It on the Map

OK, now that you’re licensed, let’s make your firm official. You should start by filing Form U4 through FINRA’s Central Registration Depository (CRD). Think of this step as registering your business on GPS—without it, no one can find you. Be meticulous, as even minor errors can cause delays; expect this process to cost $100–$300 and take 6 weeks maximum.

Choose Your Route

Where you register depends on your firm’s Assets Under Management (AUM):

• Under $100M, register with your state regulator (more hands-on support).
• Over $110M—register with the SEC (stricter oversight and added prestige).
• Between $100M and $110M, you can choose either route.

 

Step 3: Build a Compliance Program to Stay in Your Lane

Most people believe that compliance is not the most exciting part of the journey. It is what keeps your business running smoothly, though; it’s the backbone of any thriving RIA firm.
 

Key Focus Areas

 

• Cybersecurity

  Over 25% of RIAs faced cybersecurity incidents in 2023, according to SEC reports (source). Tools like SmartRIA can help monitor risks and keep client data safe.

• Record-Keeping

  Poor documentation is costly. In 2022, a New York-based RIA was fined $6.5 million for simply failing to preserve email communications. What’s the takeaway? Keeping detailed logs of everything is non-negotiable.

• Conflict of Interest Policies

  Transparency matters. Document referral agreements and potential conflicts clearly to build trust.

• Audits Are Non-Negotiable

  Audits are like oil changes—they’re not optional. 67% of RIAs rely on regular audits as their top compliance tool. Conducting internal audits can catch issues early and avoid regulatory penalties.

 

Step 4: Structure Your Firm: Picking the Right Vehicle

The legal form of your company affects your scalability, liability, and taxation. Most RIAs choose an LLC because of its flexibility, convenience of use, and capacity to protect personal assets. That’s probably why LLCs make up at least 80% of small enterprises in the United States.

Intend to grow quickly or want to attract investors? Well, of course. You may consider forming a corporation, such as an S-Corp. They provide tax benefits and make it easier to attract shareholders. When in doubt, just consult with your attorney or a Certified Public Accountant (CPA).
 

Step 5: Build a Team—The Power of a Pit Crew

Running an RIA solo is possible, but having a great team makes the ride smoother. Think of your team as your pit crew—they keep everything running while you focus on the road ahead.

Essential Roles

• Chief Compliance Officer (CCO) to always keep you on the right side of regulations by managing audits and overseeing compliance.
• Client Relationship Manager to ensure your clients are satisfied and engaged.
• Administrative support to handle day-to-day tasks, freeing up some of your time.

Platforms like RIAJobs.com are great for finding professionals with RIA experience.
 

Step 6: Set Up Operations: Fueling the Engine

Your operations are the engine of your firm. Without the right tools, even the best plans can stall.

Tech to Streamline Operations

• Compliance Management: tools like SmartRIA automate workflows and ensure audit readiness.
• Document Handling: use tools like DocuSign to handle client paperwork quickly and securely.
• Client Reporting: provide clear, easy-to-read performance reports that build trust.

 

Step 7: Your Brand Matters: Quick Tips to Stand Out

 

• • Create Your Brandbook

    Outline your visual identity (logo, colors, fonts) and voice so your brand stays consistent across all platforms. You can try your hand at Canva, but we recommend outsourcing to a professional designer.

  • Find Your Niche

    Specialize in serving a specific audience, like young professionals or retirees. The more focused your messaging, the more clients will feel, “This advisor gets me.”.

  • Polish Your Website

    A clean, user-friendly website is your digital handshake. Make sure it’s professional and highlights your expertise.

  • Show, Don’t Tell

    Use testimonials, client success stories, or clear case studies to build credibility.

  • Share Knowledge

    Offer value through webinars, blogs, or social media posts. Firms like Facet Wealth use this strategy to build trust and attract the right audience.

 

Step 8: Stay Compliant—Routine Maintenance

Compliance doesn’t stop once your firm is up and running. Think of it as routine maintenance—it ensures you stay operational.

What to Keep Updated

 

• Form ADV Updates

  Update annually or whenever there are major changes, like new services or fee structures.

• Fiduciary Duty

  You build long-term loyalty simply by always acting in your clients’ best interest. It’s necessary.

 

Step 9: Overcoming Challenges—Avoiding Potholes

The road isn’t always smooth, but it’s possible to navigate common challenges and avoid traffic jams.

• Costs Add Up

  Expect startup costs of $10,000–$20,000 and annual expenses of $5,000–$10,000 plus budget for unexpected costs, such as tech upgrades or painful compliance fines.

• Regulations Keep Changing

  Stay ahead of updates like the SEC’s intensified focus on cybersecurity. Regular team training can help you adapt quickly.

• Client Retention Is Key

  A study found 91% of clients leave advisors due to poor communication. Using CRM tools to personalize interactions can keep clients engaged.

 

Conclusion: Your Journey Awaits

By now, your map is full of notes—steps taken, challenges conquered, routes redrawn. Starting an RIA firm isn’t just a one-time journey; it’s a loop of growth and learning, every mile bringing you closer to the firm you envisioned.

The road doesn’t stop here, but with SmartRIA, you’ll always have a guide for the tricky stretches. Take a breath, celebrate how far you’ve come, and get ready to keep moving. The next chapter is yours to write.