By Ann Sebert, CEO, CAPIS
Fifty years is a long time in any industry. In institutional trading, it’s long enough to have lived through more than one rewrite of the rulebook.
When Don Potts founded CAPIS in 1977, he was responding to a very specific opportunity: new SEC guidance under Section 28(e) had just made it possible for research to be paid for separately from execution, rather than bundled invisibly into a trade. Don saw what that unbundling could mean for an independent, agency-only broker with no proprietary capital and no conflicting incentives, and he built CAPIS around it. It was a bet on a simple idea.
That was just the first of many shifts our industry has lived through since. We’ve built through deregulation, through MiFID II — and most recently, we’ve watched our own backyard become one of the more consequential stories in finance, with the Texas Stock Exchange launching with backing from BlackRock and Citadel Securities and NYSE and Nasdaq both standing up Dallas hubs of their own.
You can trace CAPIS’ last five decades through how far our original idea has traveled. We started as a single equity desk in Dallas. Over the decades, that grew into a fixed income desk, an international trading desk operating across 38 markets and a derivatives team handling options, futures and FX. In 1998, we built a transition management practice from scratch; today it’s one of the areas we’re best known for. Our pioneering commission management programs, CSA and CCA, have been running for more than four decades. More recently, outsourced and supplemental trading has become one of the fastest-growing parts of our business, as firms increasingly want a trusted partner handling execution so their own teams can focus on managing assets and clients. All of this was formed by listening to clients and building the next thing they needed.
Of course, any vision needs the right people to carry it forward, and I’ve had the privilege of seeing this impact from the inside. I started at CAPIS in 2002 as an executive assistant to our CFO, and I’ve had the chance to grow alongside this firm for over two decades before stepping into the CEO role in 2020. Across our sales and trading leadership team today, tenures of 20, 25, even 30-plus years are the norm, not the exception. Don’s son, Cullen Potts II, now serves as our Chairman, carrying forward his father’s legacy. And our COO, David Choate, joined CAPIS in 1986 and just marked 40 years with the firm.
That continuity of people is part of what makes our client relationships what they are. CAPIS clients are strictly institutional, and the range is wide, from smaller bank trust departments to some of the largest investment advisors, ’40 Act funds, insurance companies, pension funds and consultants in the industry. What connects a small trust department and a major asset manager as CAPIS clients is that both want a broker with no proprietary capital, no conflicting research business and no incentive to be anything other than exactly aligned with their interests. At CAPIS, we like to say “Once a client, always a client”, and that especially rings true when many of these relationships go back decades, often with the same people on both sides of the phone call.
Through all of it — changes in leadership, new industry regulation and now, the rise of a new US financial hub — CAPIS has continued to operate on the same three principles it started with: trading excellence, transparency and trust.
Trading Excellence. We do one thing. We don’t manage assets, we don’t run proprietary books, and we don’t compete with our own clients. That singular focus is what lets our traders average more than 15 years of experience and stay entirely oriented around best execution. In a market that keeps adding complexity, new asset classes, new venues and new reporting requirements, staying narrow on purpose has become all the more valuable.
Transparency. Our clients have always known exactly who is managing their order and how it’s being executed. That was a differentiator in 1977, when research and execution arrived bundled and opaque by default. It’s a lower bar today, since more disclosure is now required industry-wide. But we’ve never treated transparency as a compliance minimum. As an independently owned firm with no proprietary research and no affiliated venues, we have nothing to obscure, and we’ve built our reporting and analytics tools to make that visible.
Trust. We have a reputation for putting our clients first. Whether it’s a large asset manager or a recently launched fund, we take the time to learn the ins and outs of their business and their unique challenges. Our agency model is among the cleanest in the industry, giving our clients peace of mind so they can focus on what they do best: managing assets and nurturing client relationships.
None of these three ideas is complicated, and that’s precisely why they are so durable. We’re proud to have held strong to these guiding principles through a period when the industry rewarded scale and speed over independence and consistency.
I don’t know exactly what the next 50 years of this industry will look like. Given all that has happened over the last few decades, I’d be skeptical of anyone who claims they do. But I know what CAPIS’s answer will be, because it’s the same it’s always been: stay independent, deliver best execution, remain transparent, value the people who make it possible and earn the trust one client relationship at a time. In a landscape that is ever-changing, that’s still the most durable strategy we know.
Here’s to the next 50.