Brett Van Bortel is a director at Invesco Consulting, the management consulting unit of Atlanta-based Invesco asset management. He works with leading financial advisors, helping them build sizable, client-centered practices that serve high-net-worth clients. In the following interview, Van Bortel explains how Invesco Consulting helps advisors attract clients and grow their practices.
Prince: Let’s begin by having you describe Invesco Consulting.
Van Bortel: We started the group in 1997 at Van Kampen Funds. When Invesco acquired Van Kampen in 2010, they decided to keep and support the consulting group. We were one of the originators of what’s today known as value-added wholesaling.
Invesco Consulting is led by Scott West and provides a variety of programs designed to help financial advisors become dramatically more successful—our tagline is succinct: “Get. Keep. Grow.” The focus of Invesco Consulting is on helping financial advisors convert their challenges into opportunities through proprietary research and clear, implementable ideas.
Aside from the programs oriented to the high-net-worth market, some of the other highly successful programs we deliver are The New Word Order Franchise, Showtime and Preferrals. The [first] is designed to help advisors identify and implement the right language to use with clients on myriad topics to maximize communication—Gary DeMoss is one of its architects, as well as Showtime. Showtime is designed to help advisors create and present their stories and win new clients. Preferrals is designed to help financial advisors proactively pursue and acquire referrals from their clients. What’s really interesting is that the vast majority of advisors consider their clientele to be their number one source of new clients. But an even greater majority never ask for [referrals], for a host of reasons. Preferrals solves this paradox. Highly trained and experienced presenters and coaches deliver all our programs.
Prince: What is value-added wholesaling?
Van Bortel: While Invesco has a wide variety of high-quality investment solutions, we believe it’s important to both get the attention of financial advisors and help them succeed in addition to being able to offer them exceptional products. That’s where value-added wholesaling comes in. It’s additional—value-added—to traditional wholesaling, and creates a powerful value proposition for Invesco.
We know that financial advisors do what’s best for their clients, including what financial products they select for them, and we think this is essential. Our intent is to help them better serve their clients and to make their practices more successful. When there are Invesco products that make sense for their clients, we would like them to consider them.
Prince: What programs do you offer financial advisors interested in working with high-net-worth clients?
Van Bortel: This is my area of specialization at Invesco Consulting. We’ve developed a number of what are now time-tested methodologies that have been proven effective for assisting financial advisors to do more with their wealthy clients and build significant high-net-worth practices. Three of the powerful programs in high demand are Wealth Mapping, Nine Lives and RainMaker. All programs are based on extensive empirical studies and enhanced by solid fieldwork coupled with considerable attention to getting bottom-line results.
Prince: Could you describe a few of the programs?
Van Bortel: We’ve been delivering Wealth Mapping for almost a decade. Over the years, with continued research and in-the-trenches involvement, we’ve continuously refined the program. It’s one of the most capable ways of bringing in new assets, providing an array of financial products and generating new client referrals for financial advisors. What’s more important from our perspective is that Wealth Mapping often enables financial advisors to be incrementally more client centered. And it’s by being so intensely client centered that they easily achieve greater business achievements. This creates a broad-based value proposition for the advisor that is a winning formula.
Wealth Mapping is an extremely systematic approach used by financial advisors to develop a deep understanding of their high-net-worth clients. Based on in-depth profiling, financial advisors are positioned to identify what are usually many other ways they can provide considerable value to their wealthy clients. This entails opportunities to manage more of their money as well as offer other products, such as life insurance and credit. What’s more, financial advisors can use the Wealth Mapping methodology to set the stage to garner excellent client referrals from their high-net-worth clients.
The other high-demand program is RainMaker. I’m confident that most every financial advisor has been told, at one time or another, about the power of centers of influence. These are usually—but not exclusively—non-competing professionals that have high-net-worth clients who can potentially refer their clients to a financial advisor. Working with these centers of influence is the most effective way for financial advisors to meaningfully expand the ranks of their affluent clients. It’s been empirically proven that centers of influence are better referral sources than even the most loyal high-net-worth clients. However, these referrals are only possible if financial advisors can establish viable relationships with the appropriate centers of influence.
Regarding RainMaker, it is an industry truism that most advisors are going after many of the same clients served by attorneys and CPAs. But it is also true that most advisors lack a systematic approach to creating a steady stream of new high-net-worth clients. Like Wealth Mapping, RainMaker has been proven effective over more than a decade.
The foundation of RainMaker is for financial advisors to—in many ways—work with the centers of influence as though they were high-net-worth clients. For example, no capable financial advisor would approach a wealthy individual with a plan consisting of 60% equity and 40% fixed. The financial advisor would get to know the affluent prospect and create a portfolio based on a number of factors. However, a large percentage of financial advisors fail to diagnose the centers of influence they’re seeking to do business with prior to making a proposal. In short, everyone is selling themselves, rather than marketing to the center of influence’s needs and goals. RainMaker is predicated on financial advisors approaching centers of influence in the same way they strive to approach their high-net-worth clients.
What’s also unique to RainMaker are some of the fundamental underpinnings of the program. For example, financial advisors select the centers of influence they choose to work with, not the other way around. RainMaker is absolutely not based on financial advisors trading clients with centers of influence. This is usually mathematically impossible and has been generally proven to be ineffectual. Also, it takes very few centers of influence for a financial advisor to build a very substantial high-net-worth practice.
Prince: Have you developed any new programs recently?
Van Bortel: Relay Race is a new program designed to address the enormous intergenerational transfer of wealth that is under way. The baby boom generation is going to be transferring trillions of dollars to its heirs over the next decade. Many financial advisors—especially those with high-net-worth clients—are at risk of losing assets to manage when the next generation inherits. This has nothing to do with the ability of these financial advisors to manage the monies, and everything to do with intergenerational factors.
For some time, financial advisors looking for ways to expand their relationships to the inheritors have approached us with their concerns. The solution became the Relay Race program. As with Wealth Mapping and RainMaker, Relay Race is based on considerable research. In this case, all three parties are involved in wealth transfer: the inheritors, the wealth creators—principally the parents of the inheritors—and the financial advisors. The result is probably the most effective way to structure relationships with the family to help them deal with matters that are often difficult. The byproduct of being so client-centered is that financial advisors are able, if they so choose, to maintain assets under management after the generational transfer of wealth.
One of the core aspects of the Relay Race program is to focus on the leverage point where the advisor has the greatest control—the wealth creators, or the parents. Also, there’s the realization that all inheritors are not equally interested in managing the inheritance when they receive it. Along the same lines, Relay Race does not concentrate on providing an investment education for the next generation. While doing so sounds like a good idea, our research shows the strategy is actually somewhat limited in its ability to create relationships with the inheritors and of negligible impact in maintaining the investable assets.
Prince: What do you see as the future for value-added wholesaling?
Van Bortel: The financial advisory industry, like so many other industries, is in transition. Just how it’s going to evolve over the long term is beyond anyone’s knowledge. However, what is clear is that for investment management firms to excel, they will likely need to maximize their value proposition for financial advisors by providing exceptional products and research-based, implementable solutions to help advisors get new clients, keep the ones they have and grow their businesses. To be completely clear, the most important thing investment management firms can do is to provide exceptional financial products, and value-added wholesaling helps those products to become visible in what can be a crowded market.
While at Van Kampen, Scott West, Gary DeMoss, other key personnel and I spearheaded the development of value-added wholesaling. Today, I suspect most investment management firms are looking to duplicate our accomplishments but often miss the mark in topic selection or execution. Value-added wholesaling has pretty much become the norm, but truly delivering the value component of that phrase has been our mission.
What does this mean for Invesco Consulting? We’re committing the resources in the form of people, money and expertise to stay at the cutting-edge so that the financial advisors who choose to work with us can best serve their clients while building very impressive practices. We’re extremely attentive to the needs and wants of financial advisors, resulting in programs such as Relay Race. Moreover, we’re always looking to improve on our successful programs, which is why so much effort is constantly put into revising and advancing programs that have demonstrably helped financial advisors build their practices and do a better job for their high-net-worth clients, such as Wealth Mapping and RainMaker.