Partnership philosophy key to Q Wealth Partners and Arca Financial Group joining forces

"Our decision to join Q Wealth was driven by our strong commitment to be part of building something special, while retaining the most important benefits of independence," says Arca founder

Partnership philosophy key to Q Wealth Partners and Arca Financial Group joining forces

This article was produced in partnership with Q Wealth.

Q Wealth Partners enters 2024 with an exponential surge of momentum. Its new strategic alliance with Arca Financial Group is only the beginning of a number of significant new Partnerships. Q Wealth expects to double in size this year based on signed Partners in various stages of onboarding. The Partnership looks forward to revealing the newest members of its alliance throughout 2024.

The addition of Arca, which was founded in 1999 and is headquartered in Waterloo, ON, brings the number of partners in the exclusive Q Wealth partnership model to 23. The number will ultimately be capped at 99.

Joining the exclusive club

Jared Rabinowitz, Q Wealth Executive and Founding Partner, told WP that three factors stood out when providing executive endorsement for Arca Financial’s Q Wealth membership bid: A shared passion for improving client outcomes, a philosophical alignment towards the benefits of a Partnership structure, and visionary succession planning led by John Lunz, the Principal and Founding Partner of Arca Financial.

“John had the vision to look a decade or more down the road, with Thomas and Madelyn Lunz starting to play major roles in the firm, John considered where the industry is going and what needs to be done today to set up their clients - and the next generation of Arca leaders – for long term success,” Rabinowitz says “It makes them our kind of people. They could comfortably have stayed at their big insurance company dealer, they didn’t make this move for a cheque, they did it for all the right reasons - that’s a common defining character trait of a Q Wealth Partner”.

Arca Financial distinguishes itself by prioritizing full financial planning over mere product offering. This approach, where the focus is on understanding clients' journeys, future aspirations, and the best path forward before even considering investment portfolios, sets Arca apart. This method ensures that clients are not sold to, but are guided through their financial landscape to find solutions that best match their unique situations.

“Our decision to join Q Wealth was driven by our strong commitment to be part of building something special, while retaining the most important benefits of independence,” Lunz says. “We were determined to partner with an organization that would help us raise the bar for clients, while also valuing our autonomy, and supporting our growth.

“Our aim to enhance our clients' experience and outcomes meant transitioning from a traditional IIROC platform to a more comprehensive portfolio management platform. This move enables us to provide our clients access to a broad range of investment solutions through Q Wealth. Additionally, joining a professional Partnership model ensures we have significant influence in the company's future direction, by exercising our vote to help shape strategic decisions.”

Q Wealth ethos

The new partnership aligns perfectly with Q Wealth’s genesis. Rabinowitz recalled when he and the other founders recognized an unmet need among advisors seeking the autonomy and ethos of a partnership model, akin to law and accountancy firms. This led to the establishment of a partnership structure, divergent from the traditional corporate securities dealer model where the shareholders come first, and the executives work for them (not the advisors), and clients often come last.

“The idea arose as advisors - who knew myself and my co-founder Larry Berman from the bank world - asked us what it was like to operate an independent Portfolio Management firm. They wondered if we would consider having others join as partners, which sparked the idea to broaden our platform and create a ‘supported independence’ approach,” Rabinowitz says. “This led to the decision to fortify the operational, compliance, and technology aspects of our core activities - thereby creating a comprehensive platform with the capacity to support this ambition.”

The Canadian wealth management industry's current trajectory has seen many advisors break away – or express a desire to break away – from the constraints of the big banks. The independent RIA movement has been the biggest story in wealth management in the United States over the past 20 year, however Canada has lacked - until recently - the platforms RIAs rely on to make that move to supported independence, more feasible. Q Wealth has distinguished itself as a leader in this rapidly emerging area of the Canadian industry – forcing dealers including some of the biggest names in the business to play catch up.

Technological integration and future challenges

Arca’s decision to partner with Q Wealth was significantly influenced by the platform’s advanced technology stack, and its ability to streamline operations - reducing administrative burdens and enhancing productivity. This technological edge allows Arca to increase focus on its core mission: spending valuable time with clients.

Q Wealth’s Chief Marketing Officer Stephen Gasparek says that one of the key strengths of their company is its agility and ability to respond quickly, which greatly appeals to advisor Partners. This agility allows for rapid implementation across various aspects of the business, including technology, operations, compliance and notably, marketing. Gasparek highlights that their wholly-owned boutique marketing agency, staffed with individuals not from the traditional financial sector, can turn around projects in just a few days, offering a significant advantage.

Rabinowitz adds: “In 2018, we gained a significant competitive edge by establishing a modern data infrastructure, complete with a data lake. This strategic move positioned us well ahead of many of Canada's largest firms, which are now pivoting to develop integrated technology platforms to match our capabilities. Our foresight in adopting this technology early has distinctly set us apart in the industry.”