Editor’s Note: This article is based on Steve Sanduski’s podcast interview with Larry Miles of AdvicePeriod.
Imagine starting an RIA at the beginning of 2014 with $0 assets under management (AUM) and four years later, having 400 clients with about $1.6 billion in AUM. And for good measure, throw in more than $6 billion of managed money on behalf of corporations. Sounds like a firm that has cracked the code on business development!
Well, it’s no fantasy.
I recently had a convo on my Between Now and Success podcast with AdvicePeriod’s Larry Miles, a principal and shareholder of the firm I just described above.
So how did AdvicePeriod go from zero to billions in AUM in just a few years?
For starters, the firm isn’t shy about their opinion on the state of financial advisory industry. “We’re reinventing wealth management. The old model is totally outdated,” says the bold headline at the top of their website.
Fortunately, the lessons of AdvicePeriod’s rapid success translate to a firm of any size, and provide a roadmap for how smart advisors can refocus their practices around life-centered planning at a moment when fee pressure, rising client expectations, technology change and compliance concerns have many nervous about the future.
That is, if, like Larry, you aren’t too stuck in the old ways and are open to thinking about your business in a new light.
“When AdvicePeriod started in early 2014, we had no clients, we had no systems, no way that we had always done things,” remembers Larry. “We wanted to focus more on what really mattered to clients, and for us that means a lot of planning, a lot of advice, leveraging technology where we can, and really thinking about what matters most to clients. Whereas, most traditional firms typically focus more on investments and trying to beat the market. We just don't think that's possible.”
The past few years have proved Larry and his team right. It’s not possible to grow a modern financial advisory firm by checking in on your clients’ investment portfolio once or twice a year. Investors—and young investors in particular—have a wealth of options at their fingertips for tracking the markets and their investments. Many of these same investors don’t see the value in paying an advisory fee when they can just open investment accounts by themselves online. These are the disruptors that advisors in what Larry calls the “asset-gathering business” are struggling to cope with.