Michael Calvelli, a 20-year veteran of the financial-services industry, recently took the helm of Advanced Financial Solutions (AFS), a San Diego-based broker dealer focusing exclusively on investment programs for the community banking industry. Mr. Calvelli spent a good part of his professional career with the Pershing Division of Donaldson, Lufkin, Jenrette Securities Corporation (DLJ), where he oversaw its San Francisco-based West Coast operations and managed more than 50 broker-dealer relationships, among them some of the fastest growing in the country. He holds a series 78, 63 and 24 and is a graduate of the Wharton School of Business.
How did you get into the financial industry? In college I was searching for the right opportunity and I actually went to work for a travel agency. We booked DLJ and Pershingâ€™s travels. I got to know the people and I found that theirs was an industry that you had to learn from the ground up. There werenâ€™t really any management training programs or anything like that. You just got in and you got yourself a job and you worked from the beginning. So my first job with DLJ was as a cashier in the Los Angeles office. I just fell in love with it and continued to see all those changes going on. I started in 1983 and that certainly was the beginning of a great market.
What was your greatest career success? I would say the development of all those broker dealers on the West Coast. I felt like I was a pretty big part of all that growth in the late â€˜80s, early â€˜90s. It was such a fast-changing environment that we all had to keep up with and understand.
During that time, when you were working with all those BDs, did you notice any particular traits that successful firms had? I would say the ability to look into the future, take the risk, and know that the business would follow. When I first met Todd Robinson [Chairman of Linsco Private Ledger Corp.] and looked at his vision, I knew he had it figured out. I knew he needed partners and it was going to be hard to keep up with him, but you had to keep up.
Did you notice any general flaws in the BDs that were struggling? Yes. They were too worried about the competition and I definitely remember at one point telling Todd Robinson and David Butterfield you guys really at this point donâ€™t seem to have any competition. Your competition is trying to answer your salespeopleâ€™s requests and if you can get it right, what they are looking for, I think you have got it. The people that were fighting with each other trying to figure out how somebody else was doing something were never looking far enough in the future.
Where do you see the financial industry going in the next five years? What are the areas of growth, the areas of decline?
I would say the areas of growth will continue to be in personal service. People are looking for more service and a truly trusted advisor, given what has happened over the last four or five years. Disclosure will continue to be an issue, but, as I think we all know in this industry, disclosure only goes so far. There is a lot of trust there that either can be broken or built up, and I think thatâ€™s what the general public is looking for. Itâ€™s for all of us to get back to the basics of helping them. I think the trends of the industry will be that we will put a lot more scrutiny on products and whether they are fair for the customer and whether they are being built for the customer or for our end of the business, the commission end of the business, which is the way I think itâ€™s been run in the past.
What are your goals for Advanced Financial Solutions? Our goals are to become that trusted strategic partner to community banks to help them grow their business. We will work with them to expand their customer relationships and help them become the trusted advisor for their customers.
Do you use a specific method or criteria for finding great people to work with you? We have a huge advantage being in San Diego. I actually live in San Francisco and work in San Diego and have worked in San Francisco for a long time. In San Francisco you have got tons of competition, in San Diego you really donâ€™t. You know there are a lot of big firms in San Francisco. There are a lot of big schools up there. In San Diego you just have a great quality of people that understand the service business. They get it from the top of management all the way through understanding and supporting the customer and knowing that thatâ€™s the most important thing out there.
So really you look for customer service-oriented people? Yes, because really our business is a service business. We donâ€™t do a lot of product, manufacturing a product, or product analysis.
How has technology helped your business? It has helped in a huge way. The Internet itself and technology have given us a big leg-up over the piles of paperwork that we have worked with in the past. Between imaging and the network of the Internet itself, to be able to access it no matter where we go has made a big difference in just getting the business done. Our relationship used to be hard to keep track of and it isnâ€™t anymore.
How much time do you spend on compliance issues? Itâ€™s a major focus because we want to make sure that our partners and our partnersâ€™ customers are being treated fairly, so we do put a major effort on compliance.
Is there any advice you would give to another manager or principal of a BD? Get back to developing things that are right for the customer. The first question that should come to all of our minds when we think about the business is, â€œIs this right for the customer?â€ Think about the pricing thatâ€™s involved and the costs that are involved with a customer. Stop focusing on what is good for the firm or the brokers and get back to focusing on whatâ€™s good for the customer.