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 The old model is totally outdated,” says the bold headline at the top of their website.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.

But, like AdvicePeriod, you can adapt to the new realities of the advisory market by giving your clients something that apps and robos can’t: Advice. Period!

Here are seven strategies AdvicePeriod used to rapidly grow its business.

1. Advise clients on all their assets, not just the ones you directly manage. “Oftentimes, we're able to advise clients on assets that are managed elsewhere, assets that are in the form of a business or real estate,” said Larry. “We found over the years that clients were really seeking an advisor who could offer them advice on their entire balance sheet, and all of their liabilities, regardless of where they were custodied. We believe the best advisors are able to do just that.”

Larry has found that what really matters to clients are aspects of their wealth that, traditionally, financial advisors wouldn’t touch upon: business, family, education, philanthropic goals, lifestyle plans that stretch into retirement. You can rebuild your relationship with your clients around these life-centered planning pillars, and create revenue streams that supplement, or even replace, your traditional 1 percent AUM fee.

2. Advise clients on non-financial assets, too. That starts with becoming more comfortable with discussing “touchy-feely” issues that didn’t used to fall under the client-advisor relationship. That might take some getting used to if you’re happiest moving numbers around a spreadsheet, but these new conversations about financial planning and retirement are going to be the cornerstone of financial advice: the service that retains your clients, attracts new ones, and ultimately helps you grow your business.

3. Be extremely transparent in how you price and discuss your fee. “What we've done is we've itemized each piece of the value chain and said that it's worth a certain number of basis points, and we're very transparent with our clients,” said Larry. “We tell them what each of those categories are, asset allocation, manager selection, client complexity, estate planning and what we think it's worth paying for.” The AdvicePeriod model hasn’t entirely done away with asset allocation and the relevant fees, but Larry’s team believes that client portfolios are now just one part of a bigger, and potentially, more profitable picture. “These days, you can Google and find really good asset allocation, or you can go to Vanguard, Fidelity, Betterment, and get one for a few basis points,” he notes. “We help our clients with asset allocation, but we just don't think it's worth very much. And so that bucket has a very low fee ascribed to it.” Ultimately, advisors need to start focusing on making sure clients agree that it’s worth paying for professional advice in these areas.

4. Think of your services in the form of a value chain. There’s an opportunity now for advisors to build and fill up other “buckets,” creating a value chain that’s unique to each client’s needs. Wealthier clients preparing an estate plan might find value in your estate tax bucket. You might create a bucket targeting young, first-time home buyers that helps them factor mortgage options into their financial plan. You could offer soon-to-be retirees a bucket that helps them create the best strategy for making withdrawals from their retirement assets. AdvicePeriod arranges its buckets for each client, and calculates a flat, fixed fee that increases every year with inflation. But, said Larry, “that fee is reflective of the value we think we can add for that family. Combining investments, advice with planning, just being that general advisor to families.”

This way of reevaluating your services doesn’t just provide what’s best for the client, it provides you with fair compensation for the highest uses of your time and expertise. “If there's less to do and less value to add and less ways to help a client, then we should get paid less; and likewise, if there are more ways to help a family and more things that we can do that are more valuable, then we should get paid more,” Larry said.

5. Be bold and clear in communicating your value to clients and prospective clients. Revamping your practice to compete in the new marketplace isn’t just a matter of getting your “buckets” in order. You have to be able to communicate this new value proposition effectively to your clients and prospects. At AdvicePeriod, “We're big believers in telling the world what we believe in, said Larry. “By speaking about it, by writing about it, we were able to help a lot of clients find us who believed what we were talking about.” Larry said that AdvicePeriod has tested every technology available to find the best ways to communicate with its clients, but if your marketing needs a revamp, start simple. Move your weekly client eblast away from reporting on the markets, and talk to your clients about the things that matter to them. Podcasting and blogging are also excellent tools for starting the new conversations with your clients as well.

6. Fill your team with people who continuously pursue excellence. Structure your business so that from the moment clients walk in the door, they know they’re talking with professionals who understand their needs as people, and care about helping them succeed. “We’ve been very, very fortunate over the years to surround ourselves with just really great people who pursue excellence,” said Larry. “They are very humble in their pursuit of excellence, always questioning what we’re doing. ‘How can we do better? How can we deliver a better client experience for all of our clients?’”

7. You have to be a great business operator, not just a great advisor. “You need a ruthless focus on operating your business as an advisor,” said Larry. Too often, advisors are great at advising but not so great at running a business. Larry’s team has, “multiple digital dashboards, giant TVs around the office that are displaying key metrics from number of clients we have and revenue, to more tactical day-to-day things like how many people have opened and clicked on our most recent email, how many subscribers we have to our various distribution lists. We found that measuring our business is massively important,” he said. And how do they measure the business? They use lots of ratios to help them determine when it’s time to hire new people. Business ratios have been helpful in keeping track of growth and being able to anticipate when they need new human resources. “We know that as we get more revenue and we get more assets, we'll need not only more advisors but more great teammates in reporting, technology, marketing and operations,” he said. 

Implementing these ideas in your practice will go a long way toward helping you add that next $1 billion in AUM.

Steve Sanduski, CFP, is the co-creator of ROL Advisor, a discovery process technology system, a New York Times bestselling author, podcast host, international speaker and blogger at BelayAdvisor.com. To access more than 100 interviews with industry leaders, subscribe for free to Steve’s podcast, Between Now and Success, by clicking here.