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Hello, and welcome to the PracticeLab podcast, where we talk to top advisors about what makes them successful, so that you can apply those lessons in your own business.
I'm your host, Melissa Phipps. Today we have part two of our conversation between Capital Group’s Wassan Kasey and Ben Wong of Mariner Wealth Advisors in California. If you haven’t heard part one, Ben talked about future-proofing his practice through an evolution from solo practitioner to a true ensemble, where the client is truly the center of the practice. He built a strong firm without asset minimums, and has grown a diverse, “salt of the earth” client base through referrals for the past 20 years.
In this episode, Ben discusses the thought process behind his succession plan and the recent sale and consolidation of his business. He wanted to do it in a way that created wins for the team as well as for him. He also talks about some of his experience with workflow analysis, managing a team and specifically hiring. (His team uses software designed to help select astronauts!)
With that, let’s join Wassan and Ben in the PracticeLab.
Wassan Kasey: I want to transition into succession. So you talked about preparing for succession. And you said, you said to me that you weren't as concerned with your exit as you were with finding ways to continue to scale and grow while maintaining your team. And I wanted to ask, you know, can you talk about that? And what that means?
Ben Wong: Yeah, I can. I'll give you a little bit of a backdrop to that. I was sitting around, and we're always trying to come up with what's the succession plan. And the, you know, the traditional succession plan in this business was that you find another advisor in the firm, and then you figure out how you're going to transition. They're going to buy your book and so forth, and so on. And I think that’s worked well in the past. And I guess, when I think about it, the differentiation to me is that I think we all used to have practices. It would be like a single doctor practice. And I think, historically, that's the way our business is. When I first started in this business, everybody had a practice. You had your own little silo, you had your own little clients, you had your service team. And you can find another doctor or another advisor to pass that off to and sell those, that book of business, to.
I think what you've seen in the last 10 years, at least for our office, is that we actually have a business. The ensemble is a business. It's not a practice. Who's going to buy me, you know, what advisor is going to buy my practice? And at the end of the day, no one. I mean, no individual advisor or even team is going to buy my practice. My team didn't have the assets or resources to buy my practice. So it’s looking at, well, what are the alternatives then? And so was trying to find maybe somebody bigger.
Let me backstep a little bit more: I also wanted to think about, what did I really want to do for the next five years? I was sitting there thinking, OK, I could build out an RIA, I could go back and rebuild a database, Portfolio Management System, billing systems, all those things that I did in the past. And I'd spend my next five years doing that. I really thought as that's what my next five years would look like. It's not really what I wanted to do. I wanted to continue to do what I'm doing, maybe leverage somebody else's infrastructure, and continue to grow. So that's the path we took.
Also, I think, in our industry (again, I'm talking a little bit past tense) is that the only win in the retail side of our industry is to be an advisor, right? You have to own clients, you have to own accounts, right? There's no win for that team that worked with you all those years. I was trying to figure out: How do I get a win for them too, you know, where it's just, I mean, we all work together? But I think you still see that industry is just, unless you're a client-facing and you own accounts, there's really not a win for you. But if we had an entity, and anyone in that entity ended up with stock, it provided me a method to provide them a win, provide me a win, and a way for them to continue even after I'm gone. And also, I could do what I wanted to do rather than just build infrastructure for five years.
WK: You know, you're looking at the future, you're thinking ahead, not just for yourself, but you're truly a leader for the team that you've built. And thinking about them as much, or even maybe more so about them than about yourself, means that you're just an example of servant leadership. And I love what you said, an ensemble is a business not a practice. Those are wise words for everybody that's listening in.
So, you know, part of what you and I are discussing is sort of future-proofing a practice, and thinking ahead about creating a practice that has a sustainable business model. What advice would you recommend to advisors who are looking to future-proof their practice? What should they be paying attention to? Are there certain types of service offerings or client profiles? I mean, what is it that they should focus in on to help them future-proof their practice?
BW: From my perspective, at least, I think that if you look at the pieces of our business, and I know this term gets thrown out a lot, but it's that's “commoditizable.” You know? The investment process, so many pieces of our business can become a commodity with time. And what I'm finding is that the soft skills, it's being able to discuss with clients those goals. How do they want the assets to be passed down to the children to make the children's life better, if that makes sense. And spending much more time on the financial planning process. I spend so much more time doing financial planning than I ever did at the beginning of my career. The beginning it was all about investments. That's all you really talked about was investments. With time, I find that I don't spend that much time talking about investments anymore. A lot of it is “My daughter needs to buy a house. What's the best way that I can loan her money or him money and still make them appreciate it?” You know, it's all those kinds of soft things, we spend a lot of time doing that.
On the other side of the coin, I think you just have to really be careful that you're running an efficient shop. I think that the amount of clients per advisor — and again, this is just one man's opinion — but I think that an advisor is going to have to be able to handle many more clients than they used to, many more relationships than they used to. And the only way you can do that is if you can scale. You can either replicate yourself through, you know, other advisors, being able to handle pieces of those jobs, and also just being careful on your workflows. You know, how long does it take to get each component done? I'm a little bit of a nerd that way. So I spend an inordinate amount of time looking at workflows, trying to figure out how long it takes to do this item, and making sure that you’re staffed and you have the right people there to get those items done. So I don't know if I answered your question.
WK: I feel like analyzing workflows is pretty “of the future.” I mean, I think I think you did answer the question. And then you talked about efficiencies in your business. Can you offer any examples on what your firm does, or how you've gotten to be more efficient?
BW: Yeah, I'm going to say that we were early adopters of using CRM and using workflows. So a lot of workflows, they, when we have a project, whether it's opening a new account, onboarding a client, a workflow gets built on the computer. Jobs are assigned to the different people that need to get it done, whether it's a welcoming package, sending them an onboarding kit, setting up the accounts, transfer, whatever it is. But building those out? Just as an example, recently, we're having to reestablish (since we did a transition) all the online access that clients have. So, if you think about just from a numbers standpoint, if you have a thousand households, they're all used to getting their online information from a portal. And now you're switching them. And switching a thousand people, right? Everybody with different levels of technological acumen, right? You've got everybody from someone who did not know how to log on to a computer, to somebody who's really interested in a lot of data on their computer.
And we actually, we timed it. How long does it take to just do the back setup? Do you do the setup? Do you do the account changes? How do you get them? And then when you send them the invite, how do you get them logged on? And how do you get them onboarded? It takes, you know, it's a good hour and a half, if you're lucky. If you're looking at all those components of that job, and you take an hour and a half times 1000, right? We hired one full-time person; that's all that they do is just getting the clients onboarded, so that they're happy with their client portal again. They understand that they didn't feel like they got switched out of something and were abandoned.
And so that's been a project. But that takes measuring the time for each component, each job, figuring out if you have the staff. Is it going to take away from other things? And how quickly you can ramp it up. But that that's just an example of something recently that we're going through right now. And then each client is different. Sometimes you have to have, we've got that same person scheduled appointments. We'll call somebody who maybe doesn't even know how to log in, and then walks them through us through screen prompts. “This is where you click to see…” or “I can't see this.” “This is where you need to click to see that.” Those are all time-consuming tasks. And you really can't have wealth advisors or your advisory team doing it, but you can get the right person in that job and then those that can be handed off. So that's just an example of one thing we're doing right now.
WK: I mean, that's what large corporations do, right? They have a tech desk that actually aligns with that sort of needs. So the fact that you've been able to whittle that down and bring it to your business and your client base is amazing. I love what you said. It's so that your clients don't feel abandoned. And I love that wording. So I wanted to ask, you know, during the pandemic you know, you probably saw this, but was it easier for members of your staff to reach out, just to check in. I mean, was that something that you saw happen a lot of? Is that another example of, sort of, the efficiencies and the breadth of things that happened?
BW: Yeah, you know, that's actually a great question. Because we have somebody on our team that her job is, she reaches out to clients for annual reviews. So, she calls the clients, she schedules them, she gets them with their advisor, she checks in on them. And then all of a sudden, when the pandemic hit, right? We're not doing in-office meetings. There's maybe been a little bit more phone call or outreach and so forth. But she actually just went through, on her own, this isn't wasn't something that came from me top down, she just on her own went through the list. And she had some experience working with aging in the past. So she had worked for the Institute of Aging, and so forth. And she knew how difficult it would be for elderly people to be locked away for that period of time. So she just went, she just phone called our older clients just to make sure they were OK.
WK: Wow!
BW: And in some cases, what she found was that some of them just needed to talk. They felt like shut-ins. And so she just put that on her list and made that part of her job for a couple months. It's just reaching out to those older clients, making sure they were just OK. “Are you OK? Do you need to talk?” Some of them really appreciate, have really appreciated it. So that's something that, I mean, like I said, it wasn't a top-down type thing. But it was just somebody on the team seeing the need and taking it upon themselves to do it.
WK: It's so thoughtful, I mean, what a thoughtful thing to do for the clients that you work with. And, you know, going back to the hiring, because now you mentioned this person on your team who took it upon herself to reach out to elderly clients and help them feel connected with somebody. You mentioned that you hired somebody who specifically is there to help answer log on questions and onboarding questions, etc. to the digital side. I know you've hired a pretty large team throughout the course of this business. When you're thinking about hiring people, what are some of the criteria that you think about? As you look at the landscape of potential employees, you know, how do you think about teaming? How do you think about hiring people? Are there any scenarios or characteristics that you look for specifically?
BW: You know, what? I'm going to answer your question. But at the same time, and I think we've built a great team over time. But I don't have any kind of silver bullet at all on this. I can tell you what we did, I can tell you what we did.
At the beginning, when I used to interview people, I think I am terrible at it. Personally, I am not good at interviewing people and figuring out whether — I think, because of what I do, if you're an advisor, you tend to like people. So if I sit with you, Wassan, and have coffee, and I like you, I'll probably hire you. Right? You might not be the best person for the job. And so, I kind of found that early on. What we did early on was that I would let the team interview. I would be always the last person to interview. We would come up with whatever the job description what we were looking for. But I always let the team interview them, the people that they were working with, that they'd be side by side with making sure that they felt that they, that person had the qualifications for that. And I was typically the last person, basically, to sign off on it. Because, like I said, it was typically if I liked you, I'd probably hire you. And even though you might not be the best person for the job. So that was one of my first learning things that I'm probably not the best person to do the first level of filtering.
The other thing we found for a while, when I think 2009-2010 period, during the big recession, everybody was looking for work. So if you threw a job out there, you’d have 120 resumes that showed up. And we figured out there's no way to filter through that. Right? So we actually, we took on this … and I don't know if I should say the name of the company, but we took on a screening software program.
So I'll tell you the story. I'll tell you this story about it. So this company got hired with a government contract to find out what the ideal candidate for an astronaut would be. I guess there are very specific things about an astronaut’s personality and so forth to make them a good astronaut. So they built this screening platform to try to find, you know, candidates for astronauts. And then, once the government contract was done, then they took that and they just built it out for all sorts of jobs. So we actually contracted with them. And that helped me whittle it down to work, if you got 100 resumes, we would send them the link for the test. The test results would come in, and it would give you an idea about the qualifying qualifications, but also their personality traits and so forth, that will make them good or bad for the job. Then they would come in, and then we would give them the test again, except for the computer generates a new test. Because some people would just have their spouse or their friend take the test. So you never knew if you were getting the test from that person. So if you had wildly different results, we would just ask, we would just let them go at that point. Thank you for coming in, let them go. But that helped us during that period of time with screening.
Now we're in a completely different world, right? Where you can't get anybody to return an application. So I think it's, I think it's very, very different now. But I'm going to say the same thing I said about clients: sometimes don't prejudge. We just have a new hire right now where nobody was that excited. And now, they're extremely excited. So I don't know if I have a silver bullet. But I do, maybe this is the best thing to share is, if you find somebody that's destroying the environment and it's obvious, you know, that it's just not working, I probably have a tendency to let them stay on a little bit too long. And I think just if you realize quickly that it's not working, it's best to part ways than to try to just continue to struggle with it.
WK: That’s really good advice.
BW: So again, I don't know if it’s the answer to your question.
WK: You did! No, that was a great answer. I want to thank you. This has been amazing.
BW: Thanks, Wassan. It's always fun talking with you.
WK: You too, thank you so much. Bye.
Melissa Phipps: That’s it for part two. Thanks again to Ben Wong and Wassan Kasey for the great discussion.
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