In our last post, Pinnacle Advisor Solutions explained many of the reasons financial advisors feel as though they are up against the wall- the growth wall, that is. While most of your time is probably spent maintaining your existing clients, many of us find it difficult to find the time and effort it takes to reach new potential clients. Pinnacle Advisor Solutions did the leg work and provided us with the following reference study.
While we cannot speak to the success advisors have had with HighTower and others, we can speak to the impact that Pinnacle Advisor Solutions is already having on its partners in a short amount of time. So the partner we will discuss is not overwhelmed with phone calls, we will refer to him as Partner#1.
Partner#1 is an independent wealth management firm with about $35MM AUM that provides financial planning and investment management services. He had run his practice as a lifestyle practice so he could spend time with family. Now in his mid-50s, the kids have left the nest and with retirement in sight, Partner#1 wants to redouble the efforts in his business to meet his retirement goals.
To do this, Partner#1 needed to find a solution that would free his time to focus on the part of the business he loves – working with clients to solve their financial planning needs – and leave enough time left over to focus on new business development. In addition, he had traditionally delivered a passive investment program to clients and recognized that a more risk-managed investment approach was required in this environment. He needed a partner with considerably greater resources to deliver such a program.
Pinnacle Advisor Solutions’ Strategic Partnership Program was his answer. Not only did our program address some important gaps in his business like continuity planning, but it started the firm growing again and, perhaps most importantly, Partner#1 tells us that he is having fun again!
The first goal of the program is to free advisor time while also improving the product to clients (lend our economies of scale). By partnering with Pinnacle Advisor Solutions to deliver a risk-managed tactical investment to clients and partnering with FocusPoint Solutions to outsource the back office, the Strategic Partnership Program freed an estimated 60% of Partner#1’s time and eliminated any future capacity constraints on growth while remaining an independent solo practitioner. And without those capacity constraints, Partner#1 has grown by more than 10% in the first six months after on-boarding his existing clients.
Not only did the partnership relieve his capacity constraints, it also upgraded the caliber of his investment product and back office support. In a world littered with new investment strategies that guarantee strong performance and risk management based on theoretical back-tested strategies, Pinnacle offers a 10-year GIPS compliant track record of consistently beating the benchmarks with less risk. That track record reflects actual returns on actual client assets and has been verified by a third-party auditor. And FocusPoint, considerably adds to his ability to service customers: an improved technology platform puts more information at his fingertips and adds new functionality such as online document management, more flexible reporting and an online client web portal.
The second goal of the program is to help the advisor leverage that newfound time to build the business (lend our “formula for success”). With capacity constraints addressed, we are now focused on the future. Pinnacle CEO John Hill is working one-on-one with Partner#1 to establish long-term business objectives and a marketing plan for 2013 as part of our Strategic Business Consulting offering. Plus Pinnacle is making available all the marketing collateral (videos, white papers, presentations, investment communications etc…) that it uses in its own practice to Partner#1 on a co-branded basis to support his communications with current and prospective clients.
And finally, by partnering and pooling resources with two billion-dollar plus firms, Partner#1 has also gone a long way to address his contingency planning needs as a solo practitioner. Should he be hit by the proverbial bus, Partner#1 and his clients can feel comfortable knowing that the money will continue to be managed and the back office will continue to support whomever assumes his client responsibilities. The next step (already in progress) is to participate in a new continuity planning program that Pinnacle rolled out in the third quarter. This new program is a complete continuity planning solution that will protect his clients and his family.
Author: Peter McGratty CFA, VP Business Development, Pinnacle Advisor Solutions