Ep39 - Rethink: Price Trumps Niche for Firm Growth – Featuring Angie Herbers

Herbers & Company founder Angie Herbers joins H. Adam Holt and Derek Notman to revisit the common advice that new advisors must niche early to grow. Drawing on Derek's own un-niched early career, the conversation makes the case that pricing strategy, not niche focus, often drives the fastest growth in a firm's first years. Herbers offers a practical view of when niching actually starts to pay off.

• Rethinking when, or whether, advisors should niche early
• Why pricing strategy can matter more than niche focus
• Lessons from a generalist, high-growth early career
• Transitioning from generalist to focused practice over time
• How compensation structure shaped early business choices
• Balancing volume growth with sustainable pricing

Full timestamped transcript.

[00:00:30] H. Adam Holt: Derek, did you niche early on to grow your practice?

[00:00:34] Derek N. H. Notman: Adam, that really brings back some unpleasant memories, of my early career as an advisor. Um,

[00:00:43] H. Adam Holt: it was really, what do you mean your early memories were bad or traumatic?

[00:00:49] Derek N. H. Notman: it being an advisor, especially in the first couple years is really, really hard. And really stressful, uncertain paychecks. Crazy hours. I mean, we've talked about this before

[00:01:03] H. Adam Holt: Mm-hmm.

[00:01:03] Derek N. H. Notman: and so we've talked so much about nicheing, and I do believe it's important, but if I reflect upon my early years as an advisor, I had tremendous growth.

I grew like crazy exponentially over my first 3, 4, 5 years. And looking back, I didn't niche at all.

[00:01:24] H. Adam Holt: Huh.

[00:01:26] Derek N. H. Notman: I was working with anybody that would fog a mirror and then would ask for a ton of referrals. I was persistent. I would do anything anywhere. I would drive three hours to write a $10 a month term policy, I would do anything.

[00:01:39] H. Adam Holt: Mm-hmm.

[00:01:40] Derek N. H. Notman: Um, so no, I didn't niche and it's interesting cuz it did lead to some growth, but. I got tired of driving three hours for a $10 checko, as we call them. I, I wanted, I wanted to be able to become more laser focused and have more time and all that. So it's an interesting question. How about you? Did you

[00:02:03] H. Adam Holt: no, of course not. I, I worked with all humans, whether they had a paycheck or not, whether they had a rollover or not. I did all lines of business, mutual funds, annuities, life

[00:02:14] Derek N. H. Notman: Yeah. Yeah.

[00:02:15] H. Adam Holt: did all that stuff, right? That was how we, that's how we compensated ourselves. The only niche I would think that I adopted was basically planning first.

In every engagement, I would use some form of needs-based analysis to justify, because I was not a good salesperson, I could not just walk in and sell. I did not have exponential growth. I did not see exponential growth in my business until year number.

[00:02:45] Derek N. H. Notman: Wow. Wow.

[00:02:48] H. Adam Holt: survived. In fact, the first year I remember I made $11,000 my first year in 1998.

[00:02:54] Derek N. H. Notman: Amazing.

[00:02:55] H. Adam Holt: at home. I was paying my mom rent, which was not easy at 11,000.

[00:02:59] Derek N. H. Notman: Good for her for charging you

[00:03:01] H. Adam Holt: yes, I know that was her life lesson. Thanks, mom. Uh, I couldn't have enough money to go out, so I had to stay at home . But of course, if focused, you know, I was motivated. Right? Get to work. I made a little bit of money my second year, but it really was, it was really because I focused so much on planning and I had really long sales cycles, but definitely no nicheing.

But here's the irony of this question, Derek. Everyone is talking about how you need to find your niche. Who are they talking to?

[00:03:29] Derek N. H. Notman: You and I are included in that batch of everyone telling people to niche. We've, we've said it plenty of times, and I would say, and I hope , I'm not contradicting something I said in the past here, , which I, I'm good at doing that. I do it to

[00:03:44] H. Adam Holt: like it's recorded or anything.

[00:03:46] Derek N. H. Notman: Well, but, but I, I would say if you're, I mean, early on, first couple years, I would say don't listen to the whole nicheing advice as much, however, Keep it on your radar because it is eventually a place you're gonna end up or, or will want to end up.

Most advisors that do, so, yeah. I, I would say that , we don't want a six month advisor to be worried about nitching right now. They, they don't have that luxury.

[00:04:12] H. Adam Holt: It's true. There's so much conversation in the business around going directly to fee-based, going right to financial planning. Early advisors really have not built the credibility yet. How do you know what niche you wanna be unless you came from a specific. Market, this is a second career. Maybe you were a pharmaceutical or a physician, or you were a worked in construction or you were a business owner.

You know, I can see how generally your marketplace is gonna be mindful of who you know, and that's probably where you're gonna start. But it very much, our early businesses kind of get put together scrappily based upon who's willing to do business with us in the early years. But, , this came up in a conversation with Angie Herbers.

and if you don't know Angie , she's incredibly well known . She's been involved for 20 years in our space, and I've run into her a couple times. And the people that work for her, she's, uh, consulted thousands of firms, different sizes. So she's all across the board and her team, very high end, , in terms of their guidance and their research around what's working today.

And she said something in a conversation with Derek and I. That just got us thinking and I, I really, I hope that everybody gets to listen to this speed rethink tank interview with Angie Herbers. Are you ready, Derek?

[00:05:25] Derek N. H. Notman: Yeah, let's do I. She totally embodies the rethink mentality here, so definitely pay attention folks, as you're listening to this awesome conversation.

G, it's great to actually have you on this podcast. You know, Derek and I have seen you for the past 20 years, since we've been in the business, working with advisors, literally thousands of advisors now in helping them grow their practice and address the real pain points as a consultant. So thank you so much for being here.

We wanted to ask you, what's your perspective of the financial advice market today?

[00:05:55] Angie Herbers: Well, that's an interesting question because degree benefit. Our perspective at Herbers and companies is that we get to be in leadership rooms and strategy rooms long before trends actually happen. We're seeing the, the trend in real time, and then the industry sees it three years later.

My biggest concern right now, it's, um, what's gonna happen when consumers don't want all their money managed at one. So what we're seeing today is, you know, we're just focusing on consumer and consumer behavior. They're saying, why do I need just one financial advisor? Why can't I have several financial advisors?

Why can't I have some of my money at one firm and some of my money at another firm? Um, we're starting to see a major trend toward firms working together on one client firms specializing in areas and clients not having all their assets in one place. It's exciting to see this development happen.

[00:06:55] Derek N. H. Notman: Along those lines then, Angie, you know, it sounds like you guys are way ahead of the curve and what, what changes are coming or, you know, down the road for all of us.

So what is, is there a missing opportunity or some type of challenge that's coming up for advisors because of what you're seeing? It sounds like your crystal ball works a little bit better than the rest of us.

[00:07:18] Angie Herbers: Well, yes. I. The independent advisory industry is growing very rapidly. Potential clients now understand what the industry provides and what the industry is starting to tap into is the do-it-yourself investor.

So how do you allow a client to, to some degree, do it themselves, manage their own money, but help them with advice when they. and allow also those clients to get differing perspectives from other financial advisors. That is an, that is an almost an entirely complete shift to how we've seen financial advice in the past.

Financial advice in the past is you go to one advisor, you put all your assets at that one advisor. You get all your advice from that one advisor. I think in the next, you know, decade we're going to see. The industry scatter a bit. In other words, consumers, the do-it-yourself, consumers are going to come to the industry and say, we want a piece of, you know, a lot of different firms.

We don't need everything at one firm. And that's a different business model, different way to do. ,

[00:08:30] H. Adam Holt: do you think that it's because the consumer is getting different contextual advice or expertise? Is it, is the argument that they're getting investment insurance, tax legal from different sources and they want them to collaborate, or is it that they're getting investment advice from two separate entities in this model?

[00:08:48] Angie Herbers: I think it's both investment advice and financial planning advice from two. I mean, you've got one firm that has one investment philosophy and another firm that has another investment philosophy. How does the consumer know which in investment philosophy is the best? So you test them both out. You have part of your assets at one firm and part of your assets at another firm.

You get financial advice from one advisor. You go to another advisor, you get a second on panini, go to another advisor, you get a third opinion. You diversify your financial advisors. That's what the future.

[00:09:22] Derek N. H. Notman: That's what I found. I don't know how I think about it yet, but I'm definitely gonna rethink my whole perspective on that.

Assuming that's correct though, Angie, assuming that that is the direction that we're headed, what would be some action steps or advisors listen today be like, wow, that could disrupt the heck out of my business. So what, what are some things maybe, I don't know, top two, top three things. That advisors could do today to start getting ahead of that curve so they're ready for it and ready for that fractional advice, if you will, versus where they are today.

[00:10:01] Angie Herbers: Well, that gets us sent to trends and today, biggest trend today is a talent trend. And no longer are we seeing Generalist financial, so we are now seeing specialists. So you may know how to do a comprehensive financial plan, but you might be the insurance specialist, or you might be the investment specialist, or you might be the education specialist, or you might be the retirement small business owners.

So within each firm, they're going to have specialists in the future, and that's gonna be, um, dependent upon talent. Biggest trend that we're seeing right, was in talent. Talent, financial, Trump talent used to generalist financial advisors. And while there are components you know, that are needed for you to be a financial advisor, we're starting to see firms move toward more specialist advisors.

And that is the big, you know, that is how we're going accommodate this. Getting advice in multiple places versus getting all of my advice at one. . So the big issue is how do you be build the best? You are the best specialist.

[00:11:15] H. Adam Holt: That's really great. So Isa, I'm really curious, Angie, given the amount of consulting you're doing and being in these backrooms and talking about what's happening next before it's published, certainly, is there anything that you think that our community needs to.

Yeah. I'm just gonna warn you, this is a very controversial topic. I'll probably get a lot of backlash from it, but I don't believe that advisory firms to grow should, should niche out right now. Um, and, and I can back that up. So along the growth track, what we're seeing in the industry studies is that the niche is what drives the growth.

But if you very deep into that, You know what Herbers and Company does? We get very deep into organic growth. We figure out how those firms can oftentimes grow faster. What we've learned is that the startups don't actually grow by the niche. They grow by cutting price. So they start, they have a lower price or even some free service that they offer.

They gather clients. as they grow along. Then they start to see, you know, one client referring another client and referring another client. The niche develops and then they raise the price. So the, the niche is actually the lagging indicator, not the leading indicator. The leading indicator is price.

They're competing on price. Um, We don't see firms grow specifically on the niche or focusing on the niche. We see them grow the fastest when they compete on price, and then once they get bigger, they raise those prices and they just happen to have a niche.

That's really interesting. , oh my gosh, my, I almost feel, Derek, I almost feel like we have to ask more questions.

[00:13:11] Derek N. H. Notman: Angie, can you drill down a little bit more of that? Because you're gonna blow up a lot of people's minds when they hear this statement, ,

[00:13:16] Angie Herbers: I know I'm gonna get a lot of hate mail.

[00:13:20] Derek N. H. Notman: I dunno about the hate mail, but like, not to me like, wait, what are you doing, Angie? You know, even, uh, Adam and I ourselves have talked about nicheing.

So like, this is definitely against the grain and I, I wanna know more.

[00:13:31] H. Adam Holt: Yeah, I mean, the question I have is just to, just to summarize what I think you said. You're saying that when you're growing a practice, especially in the early days, and maybe that's the nuance here, in the early days of growing a practice, your goal is to grab market share.

The best way to grab market share potentially is to compete well on price to value. Correct. And by doing so, you'll attract more of the potential market. . And then as you get large and you're looking for efficiencies, you can afford let's say a Pareto principle where you go to 80 20 and that's when you start either raising prices and by nature of that cutting, those that won't stay with you.

Cuz the value proposition is not there.

[00:14:18] Angie Herbers: Yeah. Well it, your, your business goal has a lot to play into at this, but let's just say you're a startup out there and every marker out there is saying, pick an niche. Well, that's not how it actually happens. How firms are growing the fastest as they're competing on price.

Go back 20 years and think about the independent advisory industry 20 years ago. 20 years ago, everybody offered free financial planning. It was the loss leader, right? Yeah. And then as the independent advisory. Industry grew. They started to charge for financial planning. Nobody was talking about niches as much as we talk about.

Then today, 20 years ago, they were talking about offering free financial planning. They were competing on price. The same things happened today. If you're a startup out there and you really wanna grow quickly, let's just say you wanna get a hundred clients, then cut the price in here. , you cut the price of investment management or the flat feeded people are paying, which is what most startups do.

They cut the price and then they get up to a hundred clients. Those a hundred clients start referring clients that happen to be the same type of client that they're working with. So let's just say they have five teachers and then all of a sudden they have now 10 teachers and 20 teachers and 30 teachers because they cut the price in the very beginning and all of a sudden they have a niche.

so then you get even bigger. So let's just say your goal is growth. If your goal is growth, you would never cut the bottom, you know, unprofitable clients because those are potentially your future cashflow. You would just serve them unprofitably. So you start to grow and you start to grow, and you continue to add clients, and you continue to add clients.

Well, naturally, you're gonna add clients who are referring, other clients who are just like them, and a niche develop. So then everybody talks about, oh, it's the niche that grew a, no, it wasn't. It was the free financial planning that grew you. It's the cutting the price in the very beginning that grew you.

It's the referrals that grew you. It's not the niche. So if you wanna grow up fast, just cut your price and then range your price later after your niche is developed.

Such an interesting take on growing an advisory business. It is. It's almost like that, that first hundred clients or whatever it's like.

Bootstrapping. It's your stark capital. It's you're willing to make less. Now knowing you're going for that hockey stick approach later.

The hockey stick approach works so long as you do it correctly and focusing on the niche is the a lagging indicator, which everybody thinks it's the leading indicator.

It's not the leading indicator. If you get deep into those firms who are growing the fastest, look at all the big firms out there that got you over the last 15 years. , they were doing one thing for free and they were cutting their prices in the very beginning, and it's still true today. So the whole niche argument only comes after you're an established firm and your growth rate slows down.

Well, your growth rate probably slowed down because you raised prices too fast. Is it that you've

[00:17:31] H. Adam Holt: lowered the price or that you've increased the value relative to the traditional, let's say market price? Because in my own practice, we delivered financial planning for free, like you said, and we grew enormously, but, but it was because of the planning process that we argued, we uncovered more assets, so we gathered more assets per customer, thereby justifying, like you said, a lost leader.

That the planning was actually a fantastic sales process. We didn't actually wind up charging for. Financial planning at all because it ended up being actually a detriment to our growth. Right, right.

[00:18:07] Angie Herbers: If you start to charge for it, in some cases, now, this is not every case, but in some cases, depending on the client, if you start to charge for it, then you, you're weeding out the number of clients that you, you can potentially attract and at that point probably be a good idea to start nicheing.

[00:18:24] H. Adam Holt: Right. So you're saying that nicheing is something you do once you already have the. . That's really the important part. Well, nitching is something you do when you have a growth problem in the industry. But if you truly want to grow, then generally it has something to do with price or a free service, or a loss leader or some specialty in service.

It's not, you know, finding pilots or finding just people who want equity planning or finding only teachers. . If you want to give your firm a shot of steroids, then start offering something of great value free. Put a loss leader in place, or cut your price for a certain segment of clients and get your future cash flows.

Get a lot of clients coming in, maybe at, you know, maybe not profitable, but you get a lot of clients coming in who start to generate a lot of referrals, and then those referrals then create the profitability later. at all compounds. Just let the compounding happen. But too many people focus on, let me go find a niche and just focus on that niche.

[00:19:36] Derek N. H. Notman: Could it be said that an advisor should never niche?

[00:19:40] Angie Herbers: Well, I'll never say never. . I mean, if an advisor says, I only want to work with teachers because I really love teachers, and they get underserved, I'm gonna say we should definitely niche on teachers, but if you want to have growth and a sustainable, consistent growth rate, then I wouldn't focus solely on teachers because financial advice can be applied to every single consumer in the us.

One needs a financial plan. You can do the financial plan for everyone. by knitting out. In some cases it can hurt you, but if your goal is fast growth, find the service that really defines you, offer it for free, and in the future, you will gain future cash flows. Or if you are just starting out, just start out under lower price.

It's no different than attorneys. It's no different than accountants. When attorneys start out, they aren't charging $800 an hour. , they're charging, you know, I'm guessing, but they're charging $200 an hour, and as they get better and better and better, they increase their price over time and then the profitability starts to compound after they start to get a lot of referrals.

Yeah, yeah. I see. You're buying the future business. I think the comments about just saying, I can work with competitors. I'm really curious about the collaboration. It's funny, both Derek and I are working on tech project. That actually addressed that specifically cuz we didn't really see anybody else talking about this.

[00:21:19] Derek N. H. Notman: What's cool, Adam, what you're making me realize is what you just said about asset map and couplers doing the same thing. Is that something you said earlier, Angie? Maybe questioned like, well, who's gonna be the quarterback? Normally it was the life insurance agent or it was the C E F P who was the quarterback of the client's financial situation.

Why not make the client the quarterback?

[00:21:39] Angie Herbers: That's who it should have always.

[00:21:42] H. Adam Holt: I love that she threw that in at the very end. Because we are starting to see that trend and that wrapped it up. The client should always have been the quarterback, but they haven't been empowered for that one. Yeah.

[00:21:57] Derek N. H. Notman: haven't, and I, that's we've, we've mentioned this in previous episodes, the access to information now because of the internet and, and whatnot, is so great and so transparent that they are empowered to be the quarterback and they should be. It's their money. It's not ours.

[00:22:16] H. Adam Holt: That's right.

[00:22:17] Derek N. H. Notman: Um, so we should be helping them.

It's a service business. I love that conversation. I've got some, some great thoughts. You know, the thing that strikes me, Adam, so me, like you, I've got a couple things going on and

heard.

um, I still have my r i a and even on my website, I am not accepting new clients. But if I wanted to jumpstart the next level of growth for my firm, I would seriously consider what Angie is talking about and just discount my pricing or offer some type of free thing.

To just get it to rock and roll. If that's, and I don't have the time for it, I'm not gonna do that. If there's an advisor listening that wants to do that for me, , reach out,

There you

Um, but that's, I just don't have that, capacity at this point. But just re it's refreshing to hear the other side. What's your impression?

What are your thought?

[00:23:09] H. Adam Holt: You know, I'm all over the board on this one. I, I have written down several things that I do wanna share, but on your comment alone, I think why we originally responded to this thinking what, like really, and why she even said that she was going to get hate mail is because the audience of financial advisors.

Out there are those of us who have survived past those early years and. As a result, the audience is a bit mature, right? So most of us have been in the business 10, 15, 20, or years or more. We've created some level of success. We have the luxury of being able to niche, and we do so because we want to create more lifestyle, not more revenue per se.

We want to create more intentionality of that ideal customer. We wanna work with certain people that we like, and we only want to add 2, 3, 4 high value clients a year, and we don't want to get overwhelmed. So we're not trying to do. You know, the Kmart special, where we're basically gonna get into a hundred new people, somewhat profitable or not.

But , here's the interesting thing. When I rethought about this and listen to it again, I heard what you said, which was, this is what startup companies do all the time. We go and get market share first. Make them a client first. And go do it. But the reticence towards it is that most advisors, I don't think really want to grow like a hockey stick.

They want to grow more intentionally, but the misnomer here is that they should be bringing on the next generation and enabling them to go grow like a hockey stick and take their firm as a group if you feel like you have a succession plan to the next level. That's where I really think this has a lot of merit for all you experienced advisors who are thinking, eh, it's kind of like me.

I'm already niched

[00:24:50] Derek N. H. Notman: you know, that's interesting. So even if you are an established advisor and, and you've been thinking, oh, I'm only gonna grow selectively, why not grow with Angie's model, but bring on some advisors to take on that business?

[00:25:06] H. Adam Holt: right.

[00:25:08] Derek N. H. Notman: it solves a succession planning situation potentially. It helps you grow.

you're gonna get a piece of that business anyways. It's a really interesting way to do it, as long as you're providing that massive value. Heck, even my comment about my own firm like that, that would work.

[00:25:27] H. Adam Holt: Mm-hmm.

[00:25:27] Derek N. H. Notman: I could see that. That's, that's a really interesting point. Um, this is why established advisors should care just as much about this as if you're six months.

[00:25:38] H. Adam Holt: Yeah, well, it's an intentional decision. There were some other things that I thought were, were really curious. You know, we recently dealt with, I got asked by a family member to help one of their friends. , so I did a preview of, okay, I'm sure I'll help you all direct you where you need to go as a financial planner.

And he says, yeah, , I have money with two other companies and I'm looking for a third. And I'm thinking to myself, huh, why does he want a third investment manager? And it really validated why.

[00:26:04] Derek N. H. Notman: Mm-hmm.

[00:26:05] H. Adam Holt: Angie said, people are looking for diversity of their advisors. The challenge is there's been very little cohesion between those advisors, so it's not like I can call the other advisors and find out what they're doing.

They don't wanna talk to me. I'm a, I'm the enemy, right? I'm, I'm the enemy of their a u m gathering. And at the same time, one advisor is typically left coordinating and there's very little facility to do this. It's one of the things you and I are trying to fix in the business. I think it was interesting, this talent gap comment that that A lot of consumers are looking for different specialty talent.

They need to just pull them together and create a dream team. How do they do this? Or they wanna work with a financial advisor who already has multiple skills on the bench.

[00:26:50] Derek N. H. Notman: Yeah, definitely. He hence the quarterback thing. Bring in the specialists for the life insurance, for the a u m, for the financial planning. And darn it all, they better all be talking to each other. Um, so whether they do it themselves or they find a firm that's already done it, it's happening. I mean, that, that's exactly what she's saying.

It, it is happening.

[00:27:11] H. Adam Holt: What were takeaways for you? what do you really think was salient for everybody out there?

[00:27:14] Derek N. H. Notman: Well, what we just talked about. Definitely I do think that that's what's happening more so, and, and people want specialists because they want specific answers to their specific problems. , it's that simple. So that makes sense. I liked her. , price is a leading indicator. , comments

[00:27:32] H. Adam Holt: Mm-hmm.

[00:27:33] Derek N. H. Notman: Listen to the market. It's gonna tell you what it wants, what it like, or what it doesn't like. So if you can just get in by price and free and all that type of stuff, you'll learn. So I like the comparison to the startup model quite a bit. And, , as I said before, if I were gonna jumpstart my r i a to the next level for my firm, I probably wouldn't do it myself.

I'd be in involved in the conversations, but having advisors look at, all right, we're gonna do this for free for the next year, or drop our prices by this for, for whatever, knowing we're gonna increase. Uh, just a really interesting way to think about it. I just wish I had more time cuz if I did have more time, I would do it.

[00:28:11] H. Adam Holt: But that's the whole point, isn't it? And that's why it's so unappealing to established advisors. They're not trying to go crazy working all night long. You know, they value their, their home time, their golf time, their

[00:28:21] Derek N. H. Notman: Oh, work-life balance is important. I guess you bring in more people, right? You bring in people to do.

[00:28:26] H. Adam Holt: So I think price is a volume argument, right? You lower the price, you're gonna just increase demand, right? And so that means you gotta have the capacity to handle the demand, otherwise you're not gonna even capture it. You're gonna wind up being conceivably unprofitable. Our argument is that, well, you'll just, if you do a good job, you'll accumulate referrals.

You'll just get so much volume flow, you're probably gonna have to grow and expand your team to to handle it. So I think what's really coming out of this is I'm hearing. Expand your team so that you have the specialty parties to handle it. That's the first part. Invest in team and if you're really talking that you want to grow you want to have a hockey stick, go compete on price or value, right?

Deliver value to the biggest population as possible. And don't limit yourself by thinking, I can only work with physicians in my local region that , are left-handed tennis players like I, I.

[00:29:19] Derek N. H. Notman: It's good.

[00:29:20] H. Adam Holt: a couple of them out there maybe. So that's what she's saying and I think that's, it's a really good recognition because I think most of us have gotten stuck on, I only want to niche at all costs, and that's the only way to move forward.

[00:29:34] Derek N. H. Notman: And it isn't, and it's okay to to do what she's suggesting. The niche will reveal itself and then you can slow down at some point cuz you're at the place you want to be. Maybe you only want to be a single advisor shop. That's cool. But if you're looking to jumpstart that growth, you're six, 12 months in and you're just frustrated because your project two hundred's gone and, uh, , you know, you're tired of knocking on doors.

Maybe there's a better way you can do this.

[00:29:58] H. Adam Holt: Yeah, and I think it's interesting thing because what I didn't understand the beginning of first hearing this is that price is a commentary on value. We always did financial planning as the lost leader to. To earn our credibility and our trust. We always did financial planning so that it was not a barrier to say you had to pay me $3,000 just for me to do the due diligence that I need to do anyway to give you suitable recommendations.

So I'm gonna do financial planning for free. We tried to do fee-based financial planning for many years. It really didn't. Well for us, and we still to this day at our firm, we do free financial planning. If we decide that we want to take you on. Of course, we used asset map to screen, so we know in the first 15 minutes whether this is gonna be profitable or whether this is just, pro bono work, right? But that, that's, there's sometimes we choose to do that because of the relationship or the who have preferred it because we want to do that and we wanna serve. But most of the time we use still financial screening to figure out whether, which team members we need to bring to the conversation.

Is this a deep analysis or is this triage? And I think that that's, that's an important aspect. You know, I'm curious to kinda wrap this up. We had some very interesting guests the last couple times, if you remember Rich Campe said almost a contradictory thing here. He said, only spend time with ideal clients and get six favorable introductions per year.

But what do you think about that?

[00:31:22] Derek N. H. Notman: Well, if you are 10, 20 years in and you have that luxury and you only want to grow strategically with a lot of a U m and very few clients, I think his model is brilliant. And we know for a fact it works. It's worked really well for a lot of of high producing advisors. I think advisors six months in, even three years in, would struggle tremendously with that model.

Not saying it couldn't work, but I think it would be a much harder road early on to do that is essentially what what he's saying, or I'm saying it for him, , is that we're gonna eliminate. 90% of the people you can work with right off the bat.

[00:32:08] H. Adam Holt: Yep.

[00:32:08] Derek N. H. Notman: And if I put my startup cap on for a second and you tell me I'm gonna eliminate 90% of the people you can sell to, I'm, , I'm freaking out.

Like, no, that's not cool. We're gonna go sell to everybody to get revenue in the door, keep the lights on, you know, keep buying my ramen noodles and then eventually I can go do that. Um, So that, yeah, so I, I, I think Rich , is brilliant and I think it works really, really well at a certain level. But to, to contrast that a little bit, what, what did Libby tell us?

I think that was so rich was episode 36, I believe Libby was 38.

[00:32:41] H. Adam Holt: That's right, Libby said. I don't wanna say it was the opposite of this, but it, it was a compliment. She said, don't ask for referrals cuz it's creepy. Rather earn them through your intentional referral programs or how you deliver advice or guidance, whatever it is that you do. And I think this is interesting cuz it addressed the, oh, I'm too scared to ask for referrals, so I'm just not gonna ask.

And you don't do anything. Her argument is find an alternative that still feels comfortable through programs, through innuendo, through quantitating, that you have referral programs, so, so you're planting the seeds out there, and of course it's just all on delivery. What did you think about that in contrast to Rich?

[00:33:28] Derek N. H. Notman: I really like that. I think you, you could grow maybe a little bit faster as far as volume of clients versus Rich's model. Um, but I would say for, you know, Libby's model, you're maybe, probably not as established as an advisor that rich. Is, is referring to, um, you've made it past the first three to five years, you cut your teeth, you've got a little bit of recurring revenue, you know, you're okay.

So now you want to, you wanna flip the model on referrals a little bit. Um, so again, it can work really well. I like, I like her inbound methodology and how they just make it made it a warm environment to be referable.

So Adam, if I'm an advisor, right? I've li I've listened to now these three different episodes, they contradict each other a little.

[00:34:10] H. Adam Holt: Mm-hmm. and, and they don't at the same

[00:34:13] Derek N. H. Notman: They don't, you know, I, for me, I think the number one takeaway is figure out where you are as an advisor with your practice, and then latch onto one of these models that makes the most sense for where you are and where you want to go, because they all will work. That's, that's what's cool. It just depends on who you are as, as an advisor and , where you want to go.

[00:34:32] H. Adam Holt: I totally agree. I, I mean all three of these growth strategies from very respected, successful people, very successful

[00:34:39] Derek N. H. Notman: Very successful.

[00:34:41] H. Adam Holt: It's interesting because Rich tends to work with the highest producers in the nation, right? The, the people who have a achieved the pinnacle level of their profession that are hiring a coach at thousands of dollars a month.

Okay. They're, they're Jordans. Okay. So they're clearly gonna focus on, I'm only gonna spend my time with 10 clients. That's it really. Not even 80 20. We're talking 5 95. In terms of ratio, , where they're spending their time. Um, Libby is really focusing, I think, in that, you know, how do you transition from knowing that referrals is still gonna be your best customer?

But not having to be awkward about it and not saying, Hey, like, what's in it for me? And I think Angie's argument is really actually, and I re appreciate this, focusing on, again, the basics, really growth models of a company, not just what we tend to talk about anecdotally in our business. Oh, you gotta get to referrals, you gotta niche, you gotta, right.

You're trying to get to this ascendancy of acting like the rich, campy style advisor. What got you? Has been likely an absolute commitment to helping people, taking people on, and growing the customer base. And then you earn the luxury to do this intentionality of business design. And I think that so many advisors are getting a little bit, I don't wanna say misled, but maybe miscued to say niche super early

[00:36:04] Derek N. H. Notman: I think you're right there. Don't do it too early.

[00:36:06] H. Adam Holt: And struggle , right? Unless you already come from a professional, let's say you were an attorney or a C p A, you have credibility, okay? You, you know, I remember when we started, people are like, why should I trust you? You've been in the business for 2, 3, 4 years. Why am I gonna trust you with my life savings?

Right? You, you had to have a pretty good argument or a good salesperson deliver value for free. And I, and I ironically, just to close it, The moment, which I mentioned a couple of, a couple of episodes, that was, that was the breakout moment for my career is when I offered a prospect financial planning for free because their other two advisors have never done any financial planning.

They only did asset management. And I did that and that's what earned me the opportunity to do the business that that catapult did my entire business because I gave it for free. So when we just don't talk about price here, sometimes we can give value to people. That other people would charge for

[00:36:59] Derek N. H. Notman: For free. Yeah.

[00:37:00] H. Adam Holt: they'll be open to it.

I'm happy to take something for free. Right, right. You just got a free scooter, right? You took it.

[00:37:06] Derek N. H. Notman: I did. Yeah.

[00:37:08] H. Adam Holt: that's right.

[00:37:09] Derek N. H. Notman: They've listened to us dribble on long enough today, my friend. So let's, let's wrap this up. What should people do now?

[00:37:16] H. Adam Holt: Well, certainly if you haven't already, you gotta subscribe to the podcast and whatever subscription service you're using, remember to leave us a review. Reviews really matter as we're learning in this podcast game. So if you have the opportunity to give us a five star review, that's awesome.

[00:37:30] Derek N. H. Notman: We only accept five

[00:37:32] H. Adam Holt: That's right.

Thankfully, the, the system's broken for anything for Pfizer, so we were kind of black and white on that one. But no, obviously you have control . Um, but we appreciate obviously your support. So, uh, thank you everybody who's following us and remember to share this. Hopefully this is valuable to you in our mentorship podcast.

We've kept it non-commercial, uh, so that you can hopefully learn and, but we'd love to hear what you're doing. So please take some actions as a result of this. Tell us what you're doing. Use this LinkedIn, email us, whatever you're gonna do. Make sure you, you join the convers.

[00:38:01] Derek N. H. Notman: Thanks everybody for listening. Make it an awesome rest of your day, night, weekend, wherever the heck you are listening and, we'll talk to you soon.

[00:38:09] H. Adam Holt: Thanks Derek

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