Raintree Financial Solutions has seen positive growth from transitioning the majority of its advisors into more collaborative approach
No man is an island, according to the famous quote from 17th century author John Donne. And for many advisors, that rings true, with many embracing the team approach as clients’ needs become more complex.
It’s a transition Raintree Financial Solutions is embracing as it moves a large number – but not all – of its “lone wolf” advisors into a team structure. The man spearheading this change knows the benefits of the switch only too well.
Corey Ferrier spent about six years "trying to do it all" before he transitioned into building up a team that eventually grew into a branch. From there he took an executive role at the firm and is now director of national sales. He's now helped 70% of the company’s advisors move to a team model, resulting in significant short-term growth. The aim is for the number of advisors using a team approach to eventually reach 80%-90%.
He told WP there are multiple benefits to this model, which involves using specialists for different areas of the financial planning and investment process. With the industry becoming increasingly complex, regulations changing regularly, products getting more sophisticated, and more strategies available than ever before, it’s harder to be an expert at everything. Instead, advisors are becoming more of a generalist.
“With a team approach, you can have a deeper relationship with each client,” Ferrier said. “If you do multiple services with clients, you get to know them better, and you have more client information to work with when you're coming up with, or presenting, new strategies.”
There is also less competition for the same client, he added. For example, if you offer private equity, you may face opposition from a separate public market advisor or their external accountant. They might all want to own the strategy regardless of what makes the most sense for the client, who is often caught in the middle dealing with conflicting advice.
Ferrier explained: “If you collaborate as a team, you can touch base with those other professionals before presenting it and understand if it’s a good fit for the client. It’s a much less competitive and more positive experience both for the client and for the advisor.”
Another positive that's crucial to the success of an advisor’s practice is client retention and growth. Raintree believes the team approach has had an immediate benefit in this regard, with none of its advisors experiencing a decline during the past 12 months.
If you are a “lone-wolf” advisor, you tend to spend a significant amount of time looking and prospecting for new clients. Advisors can spend anywhere between 20% and 90% of their time looking for new client. But with multiple specialists at their disposal, less time is spent prospecting because there's many people trying to bring in new clients. And when they do, each component of the team has the chance to collaborate and work with that client on multiple services and product lines.
“This means the advisors spend less time looking for clients in a team structure and more time working directly with those clients, which increases revenue for the advisor, and increases assets under management,” Ferrier said.
There are challenges to a team model, of course, and not everyone plays well with others, he admitted. Finding the right members of your team is critical. Advisors, therefore, must find team members or partners that have a similar type of client base, where they can collaborate well. Typically, when the client base is a good match, the advisors get on. Not everyone is the right personality fit, though, which can lead to a swift breakdown in the partnership.
Location is less of an issue that it used to be in this new Zoom-led world but for many lone wolves, the reality of giving up control is just not palatable.
Ferrier said: “They often like the idea of a team, but they don't want to let somebody else make decisions, even in a collaborative way. They want to manage the whole relationship – and that can be a challenge.”
Agreeing the right compensation model and revenue-sharing structure is another potential deal-breaker but get that right and he believes that team approach, while not suitable for all advisors, is a more productive and lucrative way forward in today’s environment.
“Being a long wolf in today’s environment means inadvertently providing a subpar service because you can't keep up with everything available,” he said. “As our teams collaborate, they can become more specialized in each area so the client gets better experiences by everything being integrated and a higher quality of service,.
“There really is not enough time to keep on top of everything, which is one of the main drawbacks of being a lone wolf advisor nowadays.”
For more information email Corey at [email protected] or call him on (519) 943 3981.