Out at Avantax, ex-1st Global president launches consulting firm

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A growing tax-focused wealth management firm is moving forward without a respected industry executive once thought to be key to its plans.

Nearly a year after Blucora unveiled its agreement to acquire 1st Global for $180 million and combine it with HD Vest, the former president who helped lead the shuttered independent broker-dealer for 11 years has left the new Avantax Wealth Management.

It wasn’t immediately clear whether David Knoch — who was also the 2019 chair of the board at IBD advocacy group FSI — left the firm voluntarily or received a dismissal. Knoch and Avantax didn’t provide any information on the circumstances of his departure.

In January, the Dallas-Fort Worth Metroplex area firm announced that CEO John Clendening was leaving over “differences in views on the scope of Mr. Clendening’s authority as CEO.” Later in the month, Blucora appointed board member Chris Walters to replace him.

Knoch had spent 18 years affiliated with 1st Global before HD Vest’s parent purchased the firm. Avantax made him president of its Tax Smart Institute and senior entrepreneur in residence last year. He left on Jan. 27, according to FINRA BrokerCheck.

In a LinkedIn message, Knoch referred questions about his exit from Avantax to Blucora but discussed opening the new Dallas-based consulting firm now listed on his profile.

David Knoch, Preston Creek Capital
David Knoch, the president of Preston Creek Capital, spent 11 years as the president of 1st Global before it was acquired by Blucora and combined with HD Vest in 2019.

“Preston Creek Capital is a consulting firm I've started to keep me occupied while I work to find a permanent role where I can make a meaningful difference to a team of people and to and our industry,” Knoch says.

Knoch’s LinkedIn page describes the purpose of the consulting firm — which has only a barebones website with a mailing address — as “to make the financial advice profession and the wealth management industry better for all whose lives it impacts.”

His stewardship of 1st Global and influential position among the many prominent members of FSI led industry experts to view him as central in Blucora’s deal to bring the large accounting practice-focused IBD back together with the sole practitioner-centered HD Vest.

1st Global had spun off from HD Vest in 1992 over differing approaches to helping CPAs and other tax professionals branch into wealth management. In September, Blucora rebranded the combined 4,100-advisor firm as Avantax.

Tax-focused IBD leans into legacy — but under a new name
Blucora’s Avantax Wealth Management combines two firms that took competing approaches to serving tax professionals branching into wealth management.

Representatives for Blucora — which is also the parent of tax filing software TaxAct — emailed a statement about Knoch’s exit from the firm.

"David was a key figure in growing 1st Global over the years," spokeswoman Laura Simpson said. "We wish him nothing but the best in his future endeavors."

In 2018, the firm then still known as HD Vest switched its custodian to Fidelity Clearing & Custody Solutions’ National Financial Services, integrated Fidelity’s planning software, eMoney Advisor, into its client portal and picked Envestnet as its new advisory platform. Also that year, HD Vest CEO Bob Oros left and became CEO of HighTower Advisors.

After Blucora Chief Business Operations and Development Officer Todd Mackay served as interim CEO, the firm tapped onetime Cetera Financial Specialists CEO Enrique Vasquez to be president of its wealth management unit last June. He’ll also lead the newly combined Avantax from brand new offices when Blucora moves in this summer.

The executive shakeup in the wealth management unit preceded another one last month at its parent firm. In addition to Walters being named the new CEO on Jan. 30, Blucora said earlier in the month that CFO Davinder Athwal was stepping down.

Longtime technology firm CFO and former investment banker Rick Simonson has since joined the firm as a special advisor as Blucora searches for a successor. On the same day as it announced Athwal was leaving, Blucora said it was acquiring the employee-advisor RIA HK Financial Services for $160 million.

Blucora will report its fourth-quarter earnings this week. In prepared remarks that Mackay made on a call with analysts after the firm said Clendening was leaving, he didn’t elaborate on the reasons for the CEO’s departure beyond stating that it wasn’t related to business performance, any shifts in strategy or any potential alterations to new programs.

The 1st Global deal “further strengthened our market leadership and strengthened our leadership team across that channel,” Mackay said. He also cited the pending HK Financial acquisition as another example of Blucora’s success in moving away in the past five years from its earlier focus on online search and content services.

“We believe we have even more significant opportunities for growth now — along with a stronger company and team — than we did in 2014,” Mackay said. “We know that there are great things ahead for Blucora.”

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Independent BDs C-suite M&A Business development Earnings Blucora Avantax Wealth Management 1st Global David Knoch