October 14, 2021

#259 Rob Jones – Transcript

Share :

LinkedIn
Twitter

SUMMARY KEYWORDS

client, business, firm, advisors, fee, bit, people, deal, financial planning, suppose, peloton, owners, rob, advice, framework, fraser, deliver, service, thought, understand

SPEAKERS

Rob Jones, Fraser Jack

 

Fraser Jack 

Welcome back to the x y advisor podcast. I’m Fraser Jack and today I’m talking to Robert Jones from peloton, partners. G’day Rob!

 

Rob Jones 

Hey Fraser, how are you and thanks for having me on.

 

Fraser Jack 

Very good. Thank you. Thank you for coming on now well let’s give the listeners a quick overview of peloton partners

 

Rob Jones 

thanks for a year peloton, we’re a consulting business effectively two financial planning companies large and small. So single advise practices through to large very large practices, multi disciplinary practices, and we help them focus on their pricing frameworks and, and pricing advice correctly.

 

Fraser Jack 

Fantastic now and now that let’s get into the broad part. Tell us about Rob well it Rob get into the into this position or financial advice, financial services,

 

Rob Jones 

a little bit different, closer to be to be truthful with you. So I started my career, I started commerce at uni, way, way back in the day. And after I think I was in second year, third year, I can’t remember now but I broke my leg quite severely. And I ended up having to do a lot of rehab in hospital and and I started living with a mate of mine who was a policeman in Victoria. And as I was rehabbing and having to do a bucketload of work to re rehabilitate I did well at uni. So I was able to defer and all that type of stuff. But I I had to get my leg back under control. And in doing so living with the sky and seeing how excited he was to go to work every day and loved what he was doing. I thought, gee, that sounds interesting. And because I had to do a lot of training, I thought well, why don’t I give it a go a very odd thing. And so I did so that was back in 1999 and 91. Sorry. And I spent 10 years with Victoria Police and loved every minute of it. I did general duties work everyone does so uniform out there on the streets doing what police do. I also did some undercover work for a little while I did plainclothes work. And then I transitioned to a detective and spent a few years catching some genuinely good. Can I say clients or crooks? I mean, I talk about my clients these days. But back then they were my clients or customers. And yeah, so I spent 10 years doing that absolutely loved it and never planned to leave actually because I hit my mark of wanting to be a detective and then enjoying what I was doing. But I bumped into a fellow who owned a financial planning business. And he was actually x essays. So he was in the essays in Australia. And so it was a bizarre thing because it was by accident that we came together. And we got to know each other a little bit. And he said, I had didn’t have a family at the time. He did. And he said hi this and I could really do with someone with your sort of organizational skills and capability. I’ve got a small financial planning practice, we’ve got, you know, nine staff here in Melbourne. And he invited me to come on board, whatever that means, as a general manager had no idea. Even though I studied commerce, I didn’t understand financial planning at all, had no idea about superannuation, excetera, etc. But I took a leap of faith, I could always go back into the force, that’s the nature of the beast, they take you back in a heartbeat. But true to my nature, I decided once I left that was that was it, I was gonna focus on something and give my heart and soul. And I’m really glad and it’s been 2020 years to the day that I joined effectively or left the force and joined a small financial planning practice. And yeah, that that sort of transition was challenging at the time. But you know, a lot of people have asked, Well, how do you do that. And it’s funny because I’ve always been okay at making decisions. That’s the nature of the beast under pressure, under stress, making effective decisions with limited amount of information, managing risks, like when we talk about risks into financial planning sense, but the risks I had to deal with were environmental, legislative, regulatory, evidentiary, you name it, for NZ, a whole series of risks. So for us risk management in the force was something very, very significant, because lives were at stake. And I remember the last job I ever did before I left literally weeks before I started in financial planning. I had a team of analysts and a young fellow 28. At the time, I had a team of 127 police and I was writing 30 properties simultaneously. And the organization for that is extensive, and it was a big criminal network. We were sweeping up and then I walked into a small financial planning office had to deal with a workflow issue on the first day and a couple of staff are not getting along with each other too. Well. And also what have I done?

 

Fraser Jack 

So it’s interesting, isn’t it? Because obviously there’s a heck of a lot of structure and discipline in those initial training and also, also I reckon the the ability to ask really good questions and quality questions probably came out of that first 10 years of working as you said, in the force, and I liked that I liked what you said around that, you know, that we all transition Well, you know, back in that time, there was a lot of transitioning from other careers into financial advice because it wasn’t it wasn’t always the thing that was promoted with the commerce degree. Which which is very different to now I guess. But um, and and then work So tell me about that time when you walked in with your mate who was an eight As is upon and I want to call them exercise and then tell them tell me about walking into that practice and then working there for the first 12 months getting to doing your apprenticeship if you like again,

 

Rob Jones 

yeah, no, no great question. It was, it was so new and it was so unstructured in in my world I thought to be honest razor I thought I was walking into something that it’ll blow my mind away professional business concentrating Melbourne on the on the steepest learning curve, I won’t be able to add value I hadn’t actually fabulous self doubt to be perfectly blunt with you. And I just wasn’t sure what what was going on. And so I decided that I’ll do as much research as I can. I’m a classic investigator, you research everything you get your facts understood. And but walking in there and seeing we had a, we had a single office, there was 1234 advisors, we had a paraplanner, we had your typical client service team members and our receptionist and that was the structure of the business. The owner had a very, very flamboyant individual who was could be described as he’s brilliant, but a little bit erratic in one sense, because he just brought stuff in and clients were coming in non stop. And the business for me when I walked in was was almost chaotic. There was stuff going on everywhere. There were clients to be seen, there were these things called essays to be prepared, there was some internal pressure amongst people saying I need this particular piece of work, and I’m not ready to get it done. There were all sorts of stuff. And I suppose I threw myself in, I started to work out what superannuation was what, what providing financial advice was, and in fact, one of my first real lessons, ironically, it was around pricing. Fraser because I was actually photocopying for three days, our review reports that were going out to clients. And that was a bizarre thing. I literally stood at a photocopier and someone one of my detective modes rang me and said, Archie, what’s it like in business? I said, I’ve been on my feet for about 30 an hour straight, photocopying, and he’s gone. Hang on a minute. Last week, you were putting bracelets on crooks and and going to the Supreme Court and giving evidence and blah, blah, blah, murder trials. And he you photocopy. I said, Yeah, but it was in that photocopying, that I just I learned a lot. And I started to look through cash accounts for clients. And seeing this, these fees coming through was really bizarre. And the reason I mentioned it is it’s so prophetic, because it was 20 years ago, almost to the day. And I remember saying this just confusion or those these fees that fluctuated all the time, every month, there was no rhythm to it, no symmetry to it, no structure to it, and I couldn’t get my head around it. And so I asked the question of the advisors and the owners at the time, well listen, what’s going on with this, I can’t get my head around it. All Roberts quite simple, you know, clients have this thing called funds under management firm and, and what happens is the platform takes the start of the month at the end of the month, they get the average of the if you m, we then apply this thing called 1%. That’s what we charge our clients. I’ll get onto why in a moment. But we chosen one but 1.1%. And then the fee gets calculated that way. And I said, but why does it change over time, our money can come in money can go out people can withdraw some of these pension payments to be made that super contribution. It was all over the place. And I was still confused, very confused as I started to sort of unwrap what what’s this business actually do for people? How does it what services it provided was a chance for those services. And I just couldn’t get the connection at all even back then I struggle with it. And I actually said literally my first week or two? Do we need to follow a model like this? Because how do we know it’s right or fair? and How come? How do we manage your business when it changes so frequently? I said I will. That’s what that’s what we do. That’s what everyone does.

 

Fraser Jack 

That’s what we’ve always done right?

 

Rob Jones 

So shut up, Robin, just do what we have run out. So I fell in line,

 

Fraser Jack 

I find this really interesting that you’ve come to you’ve come at that from a consumer point of view. Yeah, both. As a you know, as you mentioned, the investigator, which I’m going to get to a bit later on in that conversation, because I know that’s still inside of you. Oh, yeah. The bet that you’ve approached us from a consumer saying, Well, if it’s confusing for consumer, then

 

Rob Jones 

I felt challenged by it. And I then because I was photocopying all these files, I kept looking at these different clients and I was trying to work out in my mind, well, if they’re different, and the only difference I can see is how much money they’ve got, you know, and then this fairness thing came, I don’t know, it was just one of those things like the logic of it didn’t make sense to me. I had a real real problem with it, because so I kept asking questions all the time, and they probably got annoyed, but at the same time, I think it actually challenged them a lot. They started to go Well, you’re right. I you know, and one of the things I struggled with the most was one client in particular, I’ll never forget that we photocopied the review report, the client was coming up for the review meeting in a week or twos time, and Normally we’d send it out first and come in and they’d have a chat about it. But in that intervening period between preparing it and the client coming in for the review, they had a windfall of half a million dollars or thereabouts that was going in. So we put that in and went into the same portfolio that the client already had distributed into the same managed funds that was sitting inside their portfolio, but we made An extra $5,000 out of it because it was a half a million dollars and at 1% that’s what it meant. And I, I knew that in my head was what does it take us $5,000 to pretty much just invest the same amount of money. Now back, they’re not generating an SLA on ROI and all the trouble you have to go through you still, you didn’t have to do a hell of a lot at the time. So the money went in and I thought, gee, the client, we just made an extra five grand, but have we actually done something? I wasn’t trying to get on a moral high horse fries or anything like that it was more just trying to get an understanding of what the hell is happening here. And why should that scenario exist? When it really has no logic to it? Because we didn’t employ any more people. We, we were just making more money. That was it.

 

Fraser Jack 

Yep. Yep. So that so if we then work out what Where did you go from there? I guess, how did you then think about what what could have the model look

 

Rob Jones 

like? Well, I sort of took the general manager rather than I was asked, I’d sort of tried to make a few changes in the business. And I think I was okay at some things I did. And they asked me to come on board as a director, and then I became a part owner of the business and we started to then grow. But the the thing that that we then did was we because that no one was ready at the time, there’s no such thing as a fixed fee back then fries were really well, they probably was, but it didn’t exist in a financial planning sense. to any degree at all, every firm I spoke to on the the exposures that I had to other firms was all the same pretty much 1%. But then we brought in the teed fees model, which was probably the next major shift, if you like, of that business around fee, we bought in the 1.1, we tear it down. And I felt a little bit better, because I thought well, okay, we’re not necessarily penalizing people who are successful and wealthy and penalizing their wealth, which was what I thought we were doing. We’re actually, you know, accommodating, if you like, but there was still a disconnect even from that, but at least it was a little bit better than just applying an arbitrary flat percentage of fun. And the other thing that struck me Sorry to interrupt the other thing that that stuck out at the time, too was there were clients who, you know, we use this or some advisors often say to me, now, Rob, are this client simple, simple needs client, all these circumstances is simple. That was the other big lesson for me that the more I started to deal personally with some of the clients, I never advised them, I was the owner runner, I was running the business CEO, etc. But I did spend a lot of time with clients and talking about things and got to know a hell of a lot of them. And then I realized, gosh, there’s a lot of differences between people, their motivations are different, the their needs are different, their financial literacy, financial acumen is different, somewhere or seem to be really, really complex, because historically, that’s what had happened, they had all these different trusts and family trust accounts, and etc, etc. whereas others were, were quite basic. And that was, I suppose, part of that journey, then of understanding well hang on a minute, there’s more than just a number difference here. There’s actual differences in human beings and what motivates them and, and what their core reason for advice might be. And so I started exploring that a bit further, eventually going down a segmentation sort of process, if you like, to try and even connect closer to the differences the clients were presenting with, if that makes sense. Yeah, and

 

Fraser Jack 

to be able to uncover a lot more of that information. And then to be able to keep that information in the system.

 

Rob Jones 

It because I, in the forest, we used to use this the terminology around what’s called antecedent information. So basically, if I hadn’t, if I, if I saw someone on the street that I’d sort of known was perhaps a little bit shady. We stopped them. And if they were criminal, we would basically fill out what was called an antecedent report, why are they out at a certain time? What are they wearing? How do they like to speak and engage? What are their likes and dislikes, as bizarre as that may sound from a policing point of view that is so relevant? So I started to think a lot about well, how do we capture information about our clients? How do we transfer that information internally amongst ourselves? How do we keep the client to how do we show them that they are so important to us that we know everything about them, and irrespective of whether we have to change an advisor, and in and out, we’re going to carry this sort of important personal information through including their fears and anxieties. And that was a big thing for the firm at the time to understand the stand because they were going well hang on. I mean, we’ve just got this bit about there. That’s the cash flow. They need this, they need that. But it was for me, it was more that connecting stuff that made a lot of sense, because I’d saw it before so I used it all the time. And I could we could go to crimes sometimes and I could see footwear imprints and know exactly which properties or or know how they were, were initiating their particular brand of an offense of breaking into a home. So I always felt that collection of information, sharing it having an understood was, was something that was lacking in this business, and that’s part of my little mission was to solve that.

 

Fraser Jack 

Yeah, I’m sort of a little bit on that mission with Unity sort of dovetails into I guess the idea of, you know, goals and values based financial advice and being able to then say, Well, I now understand what your internal motivations are to be able to, you know, to wanted those sort of things, let’s get back to your journey. So your owner manager in that practice where to from there.

 

Rob Jones 

So we spent that was 2001 through to 2008, in 2008, that the business made a decision that we would merge with Federal Financial Group SSG. So that group of companies, you know, around the country and to be honest, made I, having spent seven years and getting used to this industry and only one firm, boy that sort of opened the eyes up. So with these 13 firms, we did a merger, it was a script for script, merger, no cash at the time. And it was basically a like, for like comparison. And it was my, I suppose my first initiation into comparing yourself to others and having a look at similarities but also picking up differences. And I naively thought, and I was probably pretty naive at the time and ensure because I was only dealing with the firm that I was engaged with, and a little bit of, I thought we’d all be quite similar out of pricing level at a service level, at a profit and loss level. And yet, it was almost it was the opposite. The studying firms were incredibly different, even though we were delivering this essentially the same service and similar product. We were so different across so many different levels. There were so many legacies to deal with. It was a huge learning curve, and it was at ACF t that I was asked to sort of, and it was a state based business with a national team and I was asked to run a project across all firms, a pricing one, and I’ll never forget the CEO, who was now sadly passed away a few years back, but at the time, he said to me, Hey, listen, Rob, what I want you to do is I want to take any sort of I suppose they thought I was reasonably okay at the pricing piece itself. So they said to me, could you please. And he was always he was walking out of the room when he said, Rob, we need to, we need to make some more money for a start as a business because we’re not as profitable as we should be. That was number one. Number two was, we need to get everyone on the same page, can you go and organize that and synchronize pricing. Now we had 16,000 clients, we had, you know, a huge amount of money we were managing, we had so many different client profiles, we had different firms and different experiences. And we had in amongst those firms, I reckon there had to be 2025 different variations of advice fees. So we had to unravel some Our job was to unravel it all, build something that was going to one deliver the business level of profit that it could at least predict from year in year out as best he possibly could better than where it was to synthesize that across all clients. And then we had to manage the project of moving those 16,000 clients across. You know, it was messy, because, you know, some clients had to come down in price, some had to go up in price, there was all this going on. But you know, eight months, we actually did it. As a business. It was one of the most profound things that I think s G’s ever done was to represent all those clients was to bring a synchronized pricing framework, implement that framework, and then get on with the job of advising clients. Yeah.

 

Fraser Jack 

Sorry, for those listeners who don’t know, the shared full story, essentially, as you said those 13 firms came together and had to had to have their say and what their investment philosophy was and what their goals based philosophy was. And everybody had to have a bit of a saying everybody had to do the negotiating to see what what was going to be the best of breed out of those 13. firms. Yes. Which is not an easy task. We all know that. And I think the the catch phrase at the time was we’re not gonna argue over the copy of the color of the coffee cups or something. Is it was it

 

Rob Jones 

spot on? Yes, you’re talking about egos. And we’ve all gone on Fraser, I suppose. But we have some monumental egos. And I think one of the good things about that was we decided to a lot of the egos wanted their particular brain of advice to be the one because I’ve been doing it for 30 years. And it’s bloody fantastic. You know, I mean, this is the way it should be. But as it turned out, we we were confronted by that so the best way we did it was the CEO who did this, by the way, and it was brilliant move. He just simply said, Oh, that’s okay. Why don’t we just grab you and put you all in the room. And there’s nothing like putting sometimes the egos to work. And actually, Simon, you’re gonna produce something, and you’re good on the talk, and you’ve been great builders, your businesses, but we now need you to actually do some work. So we’d like you to reimagine a value proposition. We’d like you to start from scratch, we’d like to forget all the prejudice that everyone has had and all the experience you’ve had. And actually, let’s build it from the client experience upwards this time, and let’s go from that rather than down. So what does it look like? And if we’re starting today, how would we invest? How would we charge? How would we what service do we provide? What would you like that client experience to be? That was the beginning of the unraveling of both egos, I suppose, but the bringing together of synchronicity around all the key elements. And again, that didn’t happen overnight. For sure. It took probably the best part of two years, but it came together in the end and we’re really powerful.

 

Fraser Jack 

When you say synchronize pricing and synchronicity and within those dating firms. I’m thinking of a synchronized swimming team coming together and it was one of my visual I like it. tells me that that’s a really hard thing to do.

 

Rob Jones 

legs and arms everywhere fries are flowing all over the place. And they’re totally the same as well, probably. Yeah,

 

Fraser Jack 

yeah. Fantastic. So So how long were your chatbots? For how long? They say they

 

Rob Jones 

said between 2008 and 2012, four and a half years and about sort of midway through that period, Tony asked me, Tony finning the CEO at the time, asked me to sort of in take on a national role around mergers and acquisitions. Now, I’d had a tiny bit of experience or weren’t so at the time that I was but I had a little bit of experience in Firstly, rolling up all of the the money managers, the firm, I was initially employed by those entities, and then dealing with all the transaction documents, and so forth. And we did set up a couple of other companies at the time, money managers, but it was pulling all of that together. So I had some experience, but not a lot. But then I got to this great opportunity to meet so many different firms then who were who were interested in the SF Jey shed for story, who were potentially targets of SF G to acquire, and Fraser I, I, during that time, I can’t tell you how many I looked at but it was at least 300 firms. And my job it was pretty confusing to write confronting, I had to come up with a way to work out what would be a good fair to buy, and what is not a good firm to buy by definition. So I decided to build my own little internal assessment matrix benchmark, if you want to call it and then I basically lined all the 13 initial SF g firms together and looked at all their metrics, then I combined them as a single group and then I basically measured every single firm against this, but it was in was in doing that and in speaking to the owners of these firms that you realized and something really profoundly struck me one of them was some of them actually don’t know their business well at all. In fact, you know, and I don’t think this is not an awful thing to say their knowledge of their own practice its its financial history, current performance future projection was poor was very poor. And in fact, we had worked out a way that we could see that same business reimagined I suppose and and it’s in it’s a really profound thing these because this is what led to peloton coming into being I one stage on navigate sitting across the table from samonas. Towards the end of my my career, I’d sort of worked out at SF Jey. So I sort of worked out what I want to do. And I’ll be honest, I always wanted to have my own thing at some point, but I just didn’t have the experience. Till then. But, but during that time sitting around and actually having a check that I was authorized to pay for a firm, which in my mind was clearly two to $3 million less than what they should have received. Had, they just done a little bit of work in renovating their own practice sorting a couple of things out, which would have been at minimal cost to them maybe might have taken an extra 12 months or so. But that’s it. And they could have had that extra amount. Now my job was to buy it for my shareholders at the lowest possible price. But you know, I thought to myself, well hang on a minute if I keep coming across this What on earth is happening out there? And the other thing is I suppose I got to see so many different firms in so many different scenarios where some of the owners were struggling with those decisions, I had to make some businesses with small unstructured other businesses large and had cultural problems. And I started to think very deeply about I don’t know, I think I’d like to go out and help them I think there’s a business there it was, I’ll be honest, it was taking a hell of a lot of risk because I I I didn’t do any further research than that. But when I think about it, I did a lot of research I had 300 firms to look at I had all of the problems we were trying to work through and get ahead in our mind well if we hadn’t been our business what would that business then look like? And I think we’re okay at projecting that and that sort of started if you like the thinking about I think it’s time I go and it’s think I think it’s time I do something to really tap into the passion that I have and that is to actually help the owners and businesses of financial planners believing that that will actually help the incline as well.

 

Fraser Jack 

yep yeah fantastic.

 

Rob Jones 

That’s the Nexus that’s my DNA in a way I suppose. That’s such an

 

Fraser Jack 

interesting story it really just come back down to the you know your your love of finance and money in numbers and that the numbers nerd part of you combined with the investigator piece where you’re actually digging in and asking the questions and finding out and getting underneath the which is generally often a people business first I find a lot of financial planning firms there there are people business purrs, they’re there for their clients and their staff and you know even some what the lifestyle and then the numbers tend to come second which is interesting. Obviously it’s like the plumber was

 

Rob Jones 

spot on. You’ve just hit it on the head. I you know, not jumping right now to where we are. But I have this sort of catchphrase in peloton that our sole job and I just spoke to a new firm yesterday, yesterday morning. And and I said to them at the end of the day, our job is quite simple. It’s an equation that sounds simple, and that is to establish and maintain a right fee for the client, right return for a business. I found too often as you just pointed out, the business actually came to say And we kept promoting our clients first and all this type of stuff. But some of these firms riser are actually, you know, in some Distress. And that stress manifests then in their behavior and their behavior often goes to culture and culture goes to turnover of staff. And we do a little measurement on culture. And it’s amazing how much the numbers do tell a story. And I without speaking to owners, if we get their data, I can actually get a read on their culture really quickly by by assessing the longevity of team members and other bits and pieces. And it’s a really profound thing. And often it stems from, I’ve looked after the clients, I think, well, I’m paying my staff well, but I’m not paying myself very well at all. And I don’t think I’m building a sustainable practice. And that again, is part of the DNA of peloton as well was to rectify that and bring balance back. It’s not about promoting the business over the client or the client over the business. It’s about that equal objective of delivering a great service, but getting paid exactly what you should be paid what you deserve, what you what you ought to have, and just making sure that is there is the predominant strategy.

 

Fraser Jack 

Yeah, fantastic. Now tell me about that. That initial starting your own business, because obviously, consulting business to financial advisors is very similar to and financial advice business with clients, you started up you had to go and find clients tell us about how you went?

 

Rob Jones 

Well, I had to convince my wife first made and I’ll be honest with you, that was that was tough. I, I was fortunate that my business partner, co founder, Michael Harrison, came with me and both of us shared a very similar passion. And together we built peloton and we were starting there with an empty sheet. And I suppose I was thinking, well, this will be great. I’ll have all these clients, I’m sure they’ll come to us they need what we do. And I was wrong. Obviously I, we started well, we did a little bit of here and there. But we didn’t actually start delivering what we are delivering right now for some time. It just didn’t happen straight away. Because I don’t think we’re on some I don’t think we had that productive. I can use a word loosely, properly understood and and ready to go. But we did little projects here and there. For some firms, we started to slowly build a bit of a reputation. We were never coach frozen. We’re not that there were some coaches in this industry. I looked at all that we decided because we were good at execution. And yeah, it does go back to my policing days, I’d love to solve crime, it was one of my absolute joys in life was to go in and solve something the only way you did that was execution. Not executing people, of course, with the execution of the rest strategy. Yes, yes. And I yeah, so it was about execution pros. And I felt, I felt the deficit as a coach, I’d be hopeless because I’d want to get in all the time and start being hands on because I can’t stand like, Hey, I went away to this conference felt good for a couple of days. And suddenly, I’ve lost all momentum. And as an advisor, truthfully said to me, the same one yesterday, the day before, when he said, I actually don’t know where to start, I know what to do something and I have to do something, but I don’t know where to start. And so it was we always set it up to be execution focus that we weren’t going to just say, here’s what to do, tell me what to do with, here’s what to do, here’s the why of why you should be doing it. Here’s the process of doing it. And by the way, we can also do it for you because in a minute we did that and the minute we started to build that reputation has been able to execute and implement, it just changed everything for us and we went from you know, looking after one or two clients to where we are today. But But I must say we’re not a mass market coaching business at all, where we only deal with effectively 12 to 15 to 20 firms maximum a year because what we do is very intense and it takes a lot of manpower and so and because we need so much focus on it we we are not a big mass market coaching business we are a specific implementation business project management business dealing with something this industry has found terribly challenging, how to how to value advice, how to position advice at a price advice, and how to make a sustainable profit from advice. And eight years later, I’d like to think we’ve, we’ve we’ve nearly hit the holy grail of getting that right if I can say that,

 

Fraser Jack 

before we get into your the products you actually provide. It’s kind of like a 12 to 15 year year and a half type program isn’t it? It’s like that you’re not like, Let’s Let’s be together forever, you’re you know, we’re gonna help you get to here and then you’re done. Now

 

Rob Jones 

spot on in it once we get them to their what we’ve noticed their first six clients, ironically, the first six firms we’ve dealt with have all come around, done this again, even though I say to them, you can actually do it yourself. You’ve got the structure, you’ve got the framework they want, they’ve wanted to pay us and we’re not we’re not cheap pros, and we’ll talk about that later. Well, I’d say as an investment, it’s incredibly return on investment, huge, but it might seem cheap, but these firms have all come around they wanted us to do it again. And the reason they came back and the reason they wanted it is they wanted the experience again, and they wanted the discipline, and they wanted the framework and they wanted to be accountable. And they wanted to know that someone was there constantly at their back saying, this has to happen. And it’s got to happen. It’s the only way it does happen. So we sort of our program, if you like this, I focus I deliver on that I won’t get into it in real detail. But yes, essentially, there’s a, there’s a 15 month program that’s in there and the AI deliver, which is the all of the doing bit. And that’s how long it actually takes to price advice and shift clients and communicate value correctly, Fraser, I don’t want to shorten it any less. I live in a world of doing this every day, I don’t do broad price coaching. And I still takes us that long to do it. And proudly so because the more that we understand a business, we deep dive into it, the more we understand the client, the more the inclined their their will their service, their value their needs, the better we can price it. And the program itself is powerful, because firms can use it over and over again, to run their business professionally at that most important bit.

 

Fraser Jack 

Yeah, yeah, the way I sort of described as you, you do the diagnosis and one part of it and then second part, you just fix it this bit like you’re taking care of the mechanic, I suppose, you know, here’s what’s wrong with it. Now, they’ll go and fix it, you could probably teach me how to do it. But like he said that do it do it for you is such a big aspect of busy professionals in any particular patient. It’s like, well, I’m here to see clients, I’m here to see patients and here’s, you know, can you just fix that? Yes, I need to fix it, can you go and go ahead and do it. So let’s let’s dive into those two products. You The first one is what we could what you call eye focus.

 

Rob Jones 

So we use the set of actor time back in 2012, we set the business up everything seemed to be I don’t know. And we were trying to work out what is it that we actually do. And it actually jumped out really clearly. I mean, I know you might think, gee, he left a business tried to convince his wife or children dead, to go and set up a business and then sort of not really understand what it was I always understood what I want to do, I just didn’t have it properly put together. But I focus came very quickly. And it was as simple as that the focus, the focus must be on on the business itself. And look that that program is a is a literally, we send out information to a firm, they send it back, I don’t get engaged with them at a deep level about the ins and outs and what they’ve done over time I learned my lesson well not to engage in that. Why, and it might seem odd, but you pick up the prejudice of people so profoundly and I made a mistake. Actually, on one of the first firms we advised I went and listened to five of the owners. It was an accounting and financial planning practice no names, of course. But the accountants were quite dark on the financial planning side, and everyone was blaming each other. And I stupidly got myself engaged in that. And I realized that what I should have just done was looked at the information interpreted that presented that if I got it wrong, I’ll die by my sword. If I got it right, they’d be interested in what we had to say and would move forward. So to this day, if I speak to a firm, I might have a 2030 minute conversation maximum. But after that, that’s it, we send out some information in the ifocus stage, they send that back, it takes us two to three weeks to properly analyze put together our advice. Again, we’re not dealing with mes clients. So unfortunately, it does take a period of time to deal with. But it’s a really profound deep dive is it’s looking at the business taking the rose colored glasses off, looking at their financial performance, historically, looking at this service, the type of clients they support, how elastic their service proposition is, what their pricing framework is currently, what it’s done to the financials of the business, pulling back the layers to understand a better, and then reimagining that same business through our lens with the experience that we’ve got now, from the hundreds of firms that we’ve dealt with, and giving them a sense of, I suppose, framework, hope, confidence, to be able to project for the very first time perhaps exactly what the future looks like and know how to how to deal with any changes, whether it’s internal changes or changes at the client level. I think these are really powerful things. And I focused, I said it shines a light on the potential very clearly, I present that then to the owners over three to four hour meeting, and then forward them to document that we’ve prepared for them after that. And that tells everything right, it’s them. And it’s not often we’ve got it wrong, I think most I’d like to think 99% of the time we’ve actually got a completely right. And sometimes it’s very, very challenging for the firm to hear what we have to say. But surely that’s the first step. I’ve been understanding and accepting.

 

Fraser Jack 

And I think the reason Sorry, I’ve just I think some of the reasons why this is difficult, it can be quite difficult for new clients of yours to come on because they have to them a lot of businesses are perceived on the outward looking in, as you know, very well structured and business. But let’s face it, there’s no perfect, there’s no perfect business. And so for somebody to say Oh look, I’m going to let you into the inner sanctum and you can tell me all things wrong with my business. And I’m thinking that you go in and you look at facts and figures only into scad by what you see discountable are good intentions. They haven’t happened yet. So we’ll just discard them and just look at the facts. Sure, they get certainly out of it. But there’s a there’s a There’s a fair bit of falling on your sword, I guess a step by so. So tell me how you get out, you know, like new new clients of yours because this is the same as clients of a financial or financial planner, how they get them their mindset in a place where they’re willing to do that. Yeah,

 

Rob Jones 

great. Another great question. And in fact, I had someone I presented with recently who’s been in the industry for a number of years, and she’s a fantastic operator runs a great business. But she actually said to me, I’ve been hearing you heard you speak a few times, I’ve sort of heard of your group generally. And Rob, I’ll be perfectly blunt. The reason I haven’t come to you guys at this point in time is actually don’t want to hear what you have to tell me. I’m a bit embarrassed. And you know that he froze a little bit and I thought, My God, that’s now it wasn’t I don’t believe it was her ego at all. She’s such a terrific person, it was, it was her call, that the business is not necessarily in the best shape. And she wasn’t necessarily wanting that, to be told that. And so we’ve had to sort of overcome even anyone’s fear of going through a process like this, which is can be challenging, but also very positive to that the thing I suppose I would say to anyone listening is if, if at all, if at any point that you’ve sat back there and said, I actually just don’t feel that I’m being rewarded necessarily, to the extent I should be, I don’t feel that I’ve got the team completely on site with our value and how we go about things and so forth and are just don’t feel it’s right for tomorrow’s environment. Or even today’s you know, that should be a trigger to do something, whether it’s coming to peloton whether it’s engaging someone else to help you understand more about what’s going on. Whatever you do, just accept that perhaps you might need to swallow a little bit of the pill initially, to hear what needs to be said. But in that environment that we’re doing that at the same time we’re actually drawing on? Well, now we’re going to get over that bit, let’s let’s reimagine. So let’s reimagine together. But when I reimagined it for you, it’s not some hope thing, it’s not some amateur projection based on nothing, I’m gonna tell you exactly what’s going to happen in the next 12 to 18 months to your cash flow to your clients to the time it needs to do something like this, the impact on your business, and it seemed that that I think creates, then the impetus to go right of bitnet, I understand, I can see, I need to do. And that’s why I say to them, so we’re going to stop that conversation. Now we’re going to talk about whether you’re going to invest in this yourself, do it yourself, I’ve given you a framework to work to build that yourself, or do you want us to actually do it for you and implement it for you. That’s, that’s the end of the ifocus, if you like and we tell them exactly how we do it, by the way, we, there’s nothing, I don’t like to hide anything I like to I like to give a lot. And I like to say, Well, this is what you’re going to go through. And we know it works, because we’ve done it many times. If you want to do the same, go through the same steps, don’t shortcut, don’t take a I will I might just do this bit, and so forth, if you’re feeling shame about it, and you do need to change. And let’s look at this regulatory environment. If there’s ever a time to get this, right, you have no choice for us. But to get it right. It’s almost like and I’ve been saying the same stuff for eight years. And no one listened to me back out years ago, when I talked about this because everyone was used to the environment at the time, but it was never going to stay that way, you know so. So it was the is the encouragement, I think to see that there is definitely a really positive light at the end of the tunnel. And it’s not just fluff. And it’s not just Hey, you’re gonna walk out of here and you’re going to be a spec, you’re going to do all this and make all this money. I don’t say any of that. So this is a framework that needs to be put in it takes time, effort, energy on both of us skill, communication training for advisors. It’s a it’s a full reset.

 

Fraser Jack 

Yeah, yeah, amazing. So that so that’s that I focus and, and you can work with people just to do the ifocus part or then you you offer them that, you know, do you want us Do you want us to put it in place for you make it happen, make it become a reality. Talk us for any set, as you know, 12 to 15 minutes talk us through that I deliver process.

 

Rob Jones 

Thank you. So once the decision is made, I deliver kicks in and it’s four phases and quite distinct, the very first thing we do is talk to the team, then that’s where we want to get to know people, that’s where we want to get to know their prejudice, their issues, their, their positive aspects of the business, their personal history. And when you talk about a new set of well, the relevance between, you know, bringing on a financial planner, bringing on a new client where we go through the same process, so we do a lot of random meeting with the whole team for receptionists through to the to the end owners in phase one. And that takes time. That’s an interview process. We do a lot of documentation. That’s very private conversations, I do not share with the owners of the business. In fact, I explicitly tell them, I’m under zero obligation. And I’m never going to tell you what your team say because I need to get an understanding of what makes this business tick. Where it’s perhaps strengths are where its weaknesses are and to understand the human element of it a lot better, because I personally believe it’s in that human element that you see that I get a reflection of the client value and as odd as that may seem, it’s amazing when you talk to advisors and the team and and all the layers of the business, you can get a really strong sense of what the client environment must feel like and having done it so many times and seeing all different models across this industry. And I’m not saying I can, you know, get it perfect every single time, but I do get a very, very strong sense. So doing that is a key part of it. And then we go back into numbers again, sorry, I

 

Fraser Jack 

feel like that, that, again, is where your trained investigator can make really come through.

 

Rob Jones 

I’ve had some in tears, I’ve had some a bit worried I did find for us, I have to say, in our deliver got proudly caused the sacking of an advisor, one out of 190 that I’ve seen in this industry, or 200, who was a genuine crook. And on the very first day we came in, by the end of the day, that person was gone. And it came about because of the questioning and yeah, I’m fairly obsessive about it. I I never asked a question that engineer yes or no, it is always who, what, why, when, where, how that’s, and the and the reason for that is is my training. And it’s you get people to speak, you get people to talk and as I said, you get a really strong sense of connection then and, and this particular individual and I want to hone in on it, of course and waste time. But that was the prime example of a person that shouldn’t have been in his industry. And it’s a reason that these interesting regulations are imposed upon everyone. But the 190 or 200 other advisors I’ve spoken with, it’s been such a privilege, they are so damn awesome. They annoy me at the same time because they limit their value all the time. And the only way to let that really unravel and that’s where it does if you’d listened to their stories about the great advice moments they have achieved for their clients. And when they say stuff to me like I don’t think much of this client Rob or you know, they’ve really easy to service. I never accept that which is a bit like back in the old criminal days I never accepted a Loki taser. And I’ve called him almost read and he said, No, I didn’t do well, okay, well, I’m gonna I’m going to work out and make you trip yourself up. Oops, I shouldn’t say that. I’m going to work out a way through questioning to get you to tell me when I need I know is that is the case. Anyway. So that’d be so important.

 

Fraser Jack 

Number one, number one is team. The second step is numbers

 

Rob Jones 

is absolutely coming back in about understanding first the elasticity of the service proposition peering that then and understanding client profiles. Now the thing about client profiles is you know, people often say our clients need superannuation advice, or they need pension advice or investment advice or whatever. And everyone sort of tends to stop there there or don’t go too much further, we want to go much further, we want to understand profiles, not how much money someone has, but the type of Client Profile they are. And the way that we unpack some of that is through questioning around the the reasons that they came to advice in the first place. Why did they come to the business in the first place? Was there something missing? Was it something lacking? Did they have hopes that they perhaps couldn’t do themselves? Is there a financial literacy issue? Is there a lack of time issue? Is there a financial succession issue or financial philanthropy issue that they want to pursue? That needs to be unpacked so so much, and yet, it’s too much lift off the table, but so so we want to understand that. So understanding the client profiles is that next stage with the numbers again, yep, then we go into the next phase of building their their initial pricing framework, and in some firms we’ve actually done, we’re up to version nine on one firm, it just, it takes time, it really does. Because if we ignore the client profiles, or we just take the extreme end of client profiles, we’re gonna miss the core group of clients that every business looks after. And the presumption and it’s a reasonable one is that same client profiles will come to the business at some point, the extreme ends we can deal with, but they shouldn’t dictate the pricing framework, because it’ll distort everything. So we spend a lot of time around pulling all that together, presenting that to the business, then we go into a testing phase. So we take all the advisors behind the analysis of how we got to where we got to, we talked to them about targeting profit, a simple proposition of actually targeting profit. Now not all advisors are owners of a firm, they don’t often know that. But in our world, the firm’s we work with have been so brilliant, insane, they’re exposing themselves and saying, We want you to know everything advisors. If you’re not honest, we want you to come in behind the curtain and I ask them that permission, can you let me take them in survey can understand the why here so that they feel connected to the process, they feel connected to the pricing validation piece that’s so important, and so that when they’re talking to clients, it becomes something that they really believe in, and it’s not something they’re just going to have to tell you what the fees and I are making a fortune, I don’t believe it. So we do a lot of work around that. So that’s sort of phase three. phase four is, is coaching. Now we actually take advisors on a journey so we actually script right for them. The conversation they have they have with their in client too, for a couple of things. It’s not for the client phrase that the client gets. It’s overwhelming our analysis and performance to date and everything we track and as you know, we track every single individual client here we’re not talking stuff that’s fluffy. We know exactly the movement of every single one of the 8000 clients that have gone through this process. So we know the success Right are presenting to clients, we know what they value, we know that to two to 3% of every firm we’ve worked with pretty much to 3% of the clients have left because of this process. And you know why they’ve left not because of the price, they’ve left because of value. And that’s a hard hard thing. And I said at the outset, every firm Listen, I’m going to tell you some some good news first 90 78% of your clients are going to sign the paperwork in the meeting straightaway when you present it, irrespective of the type of change in the fee. Now, don’t forget fees come down to in our world as much as I go up. It’s the process that determines the fee. But for those that go up, overwhelming numbers signing and why do they sign up straightaway, they have no issue with it. Because one they believed in the process, that device has just taken them through to they see so much value in the practice they it’s unquestionable to them. And that’s that intangible value component. So they don’t have an issue, they don’t believe they’ve been hoodwinked into something. And they believe they’re getting tremendous value. But a reality is a small percentage don’t won’t, and just will leave. And so that’s a fact. But overwhelming, they don’t. So we show the advisors how to have a conversation with a client in a structured way to introduce a really tough topic. And I’m surprised at how many firms actually haven’t modified their fees or had a tough fee conversation with clients. And yet, we now have to do that every 12 months, we’ve got to reset things. So the education side is huge on supporting the advisors to have these challenging conversations. By giving them a structured format that is believable is clear is so absolutely transparent to the client, the client sees everything. And we simply believe that once that happens, that transparencies absolutely brilliant and everyone sort of lines up to it. And there’s no ambiguity and it’s there’s no way to hide, absolutely no way to hide. So we teach them how to handle objections for objections that might come up and just how to how to get out of a situation if need be. But perhaps the thing I’m most important about is we teach them how to position their value accurately. And this has been a real problem of ours for for mine, personally, I wanted to solve for years, he said, I asked an advisor, tell me what you say to your clients and tell me how you tell me who you talk to me if I’m a new client. And too often advisors constrict their value by saying three to five things typically, look after the goals and objectives, we we invest your money for you, we’ll look at asset allocation, we’re gonna look at tax as well for you, and we’re going to help you navigate fantastic, but it doesn’t actually tell me what an advice business does on a monthly basis. And why I’m paying this fee that could be 50,000, or 1000, or 4000 or 2000. Another, what is it that financial planning practices do for clients. So part of what we’re doing is actually unpacking that completely, and giving the advisors a broader conversation with the blinkers off, so that they don’t get trapped in constricting value. Because when you huddle around those three, or four or five things, you actually tend to pull, you know, psychologically the price down. And in fact, a lot of advisors then will say to me, and a lot of younger advisors will see a fee of clients currently paying go rob, I don’t believe in that fee right now. Um, you know, and you’ll ask him, Well, they don’t know, you ask him how much money is the business making on that client, and even an owner with 30 years experience process, it has no idea really, I don’t know what I’m making on that $12,000 fee, or that $8,000 fee, I could be making a lot could be making nothing, I could be giving it away. This isn’t about, you know, ramping fees up. It isn’t about, in fact, a lot of what we do is promote pro bono work and discounted work for those Australians who are struggling. But there’s got to be a reason for doing that. You’ve got an economic businesses. So look, I’ve waffled on, I’ve covered a lot of things here. I apologize. But I’m trying to give you a sense. And then in phase four, bang, we start at implementation. And that could take three to four months just to get to that first implementation from the start. And I make no apology for it. Because all of that work gets done in that time to get everyone ready to get the business ready, get the structure of the conversations ready, the paperwork ready, get the advisors fit and ready to go for it. And then it’s a progressive implementation, according to the review cycle of the business, and all existing clients are moved. And then they can also deal with the new clients coming through. And it means that within 12 to 15 months, the whole business has been completely reimagined and transitioned to add a financial framework level.

 

Fraser Jack 

Yeah, I really love it. I love the structure. I know that there is definitely a process and the advisors themselves and having that belief in this is the creator. This is the correct structure. And often those first few the first first few conversations the hardest. So to be able to have those first few conversations in a structured format that take place before you’re actually going to a client. I think it’s pretty, pretty incredible. So Rob, so that’s that’s a really, really great process for financial advisors. I imagine this articulating the value the true value in financial advice, Joanna, give us a bit of a snake insight into what you might say, and is it different for every firm or do you have a standard belief.

 

Rob Jones 

It’s very different for every firm and I suppose that’s the first thing to demystify here. Even though we all Financial Planners and we largely deliver the same thing. cost structures, profit structures, history, everything is cost base, everything is so different. But at the core of financial planning right in this is my belief in unpacking services, we know that there is a minimum of 12 different service areas or expense areas that are required to service a client, no matter the profile, that’s the minimum, we’ve got some firms that that goes up to 24. And it’s in that unpacking their capability, their qualification how far they can extend into the advice range. And that becomes fairly then right, that becomes their proposition that becomes the scope of what they’re capable of servicing. And often it’s a surprise to them to actually see that laid out structurally and functionally. And then for their clients to actually see that when those clients are reflective against those same set of service areas that the business is qualified to do. But when it comes to to positioning, and we had a, we had a situation where an advisor was 25 years advisor Fraser really experienced guy, a client came in the peloton process or the deliver process was delivered to the client. The client didn’t say anything in the meeting around consenting to the change in the fee. The fee was moving from I think around $1,000 to about 12 or 13, or something like they’re in four or $5,000. That’s a reasonable increase. It’s not certainly not the biggest isn’t certainly not the smallest. It’s a reasonable one. And the client wrote an email straightaway when they got home. The client was actually a policeman, wife, as a teacher. so knowledgeable people experience people. And the client wrote a simple thing back and said, Listen, I don’t necessarily object, you actually explained everything quite well, really well. I don’t object to what you’ve just delivered to me. But before I hit the button and consent to it, what do you actually you’ve told me I pay have to pay a monthly fee. And it’s part of it. And I’ve seen that before. But what do you actually do for me on a monthly basis? Now the advisor then rang me it was interesting, because he said, Robert got this email. And that’s what the client said. And I said, Well, you’ve been advisor longer than I’ve been in business. So what was your response? And he again, sort of clustered around those five or six theories. So I said, we look if if it’s all right, I’d like to respond to that client through you, of course. And I’ll tell I’d like to tell the client exactly what goes on in a financial planning practice to service a client, which in my world equates to the value of advice, right? So I did and I actually listened for this client 15 different areas that their monthly fee contributes Crawford is one of them. So the final one was profit margin. And the client came back once he saw everything, and it was all laid out in the same way that it was printed, presented to him, but just with a bit more detail. And the client said he finally understood because he actually thought my needs are quite simple on what do you guys do only see your once a year or twice a year, and blah, blah, blah. But that’s not what you pay a fee for months or twice a year, you actually pay it for this ongoing thing that has to work. And it was just through, I suppose peeling back those layers, then it makes sense. And that now has become a little bit of a interchanges for every firm, it has to because each firm is a little bit different in where they go. And each client is a bit different in terms of what they need. But the core structure of that is something that I’m passionate about. And it’s something when I train advisors now and I send them and say to them, you can put this on your website if you want, and they want to use it because it actually is the fullest example of what actually goes on in a financial planning practice. And why can’t you pay a fee. And the crazy thing is, the advisors specially the ones come in and go well, I didn’t even realize this. Now I didn’t realize that you’re right, this is the areas that we’re doing. These are the areas that touches, even advisor training, even the compliance and regulatory thing, all of that we’ve made sure it’s quite clear and explicit so that there is no ambiguity. And that part of the fee goes toward this, just as it is that specific need for that specific client which needs to be dealt with. And a lot of it is around that intangible value piece. So we found out the reason why this policeman and his wife needed advice, there was a couple of reasons One was a financial literacy one, not that they were an educator or anything, it’s just never been an interest, they always came back to the firm and asked more and more and more about things. Because they need more understanding, they requested more time, they needed more meetings, that was part of their DNA, they wanted more attention, because they couldn’t quite grasp some of the concepts. So we built that in for them. Now there was another client, the next one that came through was a counting partner for you know, a text partner of a firm of one of the big four accounting firms here in Melbourne, and absolutely has bucket loads of knowledge, but had no time. So there was a time based engagement that we were factoring in, and the importance of time and getting organized. You know, this is what advice is about. It’s about understanding those initial needs, desires, gaps, if you want to call it and actually making sure that you’re pairing your value to that, because the minute you do, part of the fee, we say for every single client and this is in the education of the advisors, his clients are investing in themselves. And my level of investment that I need to make is different from someone else based on my experience and where I’m at in my stage of life. But the minute you connect me that I’m invested in myself and my family’s future, and it just changes sometimes this thing of, hey, I’ve got this, I’m going to try and screw the fee down. We’ve had clients just constantly want to test Your advisor, they’re only testing them, right? They’re putting on them. And I’ve heard advisors go, Oh, look, Petrie might be able to do a little bit with the fee. And I stopped them and go, the minute you say, then all you’re doing is lowering your own profit. So do you want to do that for that particular client? Do they deserve it? Did I fit a category that you shouldn’t be discounting them? Do they? Have I Got any right over any other client, you’re eating into your profit? So let’s get confidence about what we do. Let’s know what’s valuable. If the client doesn’t believe it’s valuable, that’s the right. They’re not a client. But if they do, they’re invested in themselves. And then there’s also these cost areas that they must pay this to stay. It’s as simple and as logical as that. But the conversation and framework and pricing model Fraser has not to this day, as far as I’d like to say, it hasn’t been structured that way that you can have that type of conversation fluidly, honestly, openly, transparently and not budge from it. Yep. Which is the important point he

 

Fraser Jack 

exactly right, Tim, thank you for that. And speaking of fees, and valued, you have to talk about how you charge and your fees.

 

Rob Jones 

Yeah, 100%. So the focus is $15,000 plus GST. But occasionally, it depends on the type of firm depends on what we find, we can provide a bit of a discount to that we’ve gone higher, we’ve gone lower, but it takes us roughly between 60 to 80 man hours to put together and ifocus some firms are very complex, some firms got MDA managed account structures need some unpacking, that might take a bit longer, but we base it on that and our standard fees been around 15,000. But we we move between the between the ranges to deal with it. As far as I delivers concern, the engagement that I deliver is somewhat different. It’s a minimum of 400 hours, even for a single advise practice, I get this a lot. You know, we work just as much and we got plenty of hours through to we’re working to probably 1300 1400 hours with a firm with nine advisors at the moment. And it’s a time based thing. So we charge a minimum fee to engage peloton at $80,000. For I deliver spread over 24 months. And I suppose if I can just get to the topic, Ryan, I was told this phrase, when I first started the business, I said, Rob, and back then we were charging $5,000 for an AI focus and you know, $20,000 ride deliver. And they said one someone a couple of people I’ve trusted mentor said our advisors won’t pay. There’s no way they used to get handouts, they won’t pay for that. That’s a 5000 little 20, let alone 30. Well, we have pretty much zero, I don’t have a problem with selling the fee because it’s an investment for us I it actually is the easiest thing to do. And I know it sounds large, and I respect that. But it’s what you got to pay for what you get. And the return on that is phenomenal. I don’t think we’ve got a firm yet that within the first seven months has actually covered already that peloton fee that’s amortized over the period for them. I haven’t seen a firm yet that actually had the budget for this even it does self pay. But I like to think it’s more than that. It’s an investment. And if you don’t want to invest in it don’t if you want to invest in it, see it as an investment. The return is very, very clear. And we do a lot of cash flow projections for the firm. We show them exactly when it’s going to pay you back. And it dwarfs the impact. I had a firm recently I’ll give you a very simple example. We present an ifocus to them. Sadly, before we got there, they had just bought $400,000 worth of recurring fees. Cost of 1.1 million It was about 2.25 roughly recurring. We identified in their business a minimum of $435,000 of ongoing revenue from existing clients. Now additional cost base all clients known to the firm and that would cost them I think about $150,000 to get peloton in to do. I think they had for advisors 100, something like that for advisors. Yeah, I don’t think I have to say much further than that. I think it actually explains it. What they did was they bought themselves an extra 300 clients, they had to put on more people, clients, I didn’t even know problems in them. As we found out subsequently the service issues of some of those clients history they don’t really know. And I’m not against acquisitions, I’ve done 38 transactions now. Buy and Sell, I have to fix your Fix your house first. For goodness sake in this world, you’ve got to fix yourself first, you’ll look at the transaction totally differently, then you’ll be able to profile that over your new framework and you’ll be able to get it right from day one rather than just piling on problems and their expensive problems too. You’re not against it. I just think it needs to be done a bit better.

 

Fraser Jack 

Yeah, you certainly sounds like you know developing those foundations and securing those foundations within your own business before you bring on who knows what elevate an existing book spot on. Rob, thanks so much for coming on and chatting to us today and going through your process how can people reach out to get hold of you contact you if they want to continue the conversation?

 

Rob Jones 

Firstly, thanks to you for as to for reaching out and giving me this opportunity to talk about something I’m absolutely love and live it every day. So I want to say thanks to you and your community 100% quite simply email so peloton partners so the website www peloton partners Pentatonix p e l o t o n sometimes people yell at me there’s a biking analogy in there that I didn’t get into but anyway that so it’s peloton partners.com.au I’ve got a mobile I’m happy to give that phrase at any time I don’t know what the process is but by mobile as well through our LinkedIn all sorts of avenues and we’d be happy to chat to anybody and just have a conversation with them

 

Fraser Jack 

fantastic yeah I think with the powers of Google these days peloton partner should be found or yourself Rob Jones on awesome, especially on LinkedIn. I think he pretty much LinkedIn half the industry, so it shouldn’t be too hard to find you. Absolutely. Thank you so much for coming and sharing. It’s been it’s been an absolute pleasure.

 

Rob Jones 

Thank you Fraser.

Listen to the podcast on the links below or on your favourite platform

General disclaimer for this podcast and all XY Education podcasts
https://www.xyadviser.com/disclaimer/

DISCLAIMER: The XY Adviser website and all content contained on the website is limited to general information. It does not constitute legal, financial or other professional advice. XY Adviser does not hold an AFS licence and does not provide any financial services. Nothing on this website should be interpreted as financial advice. Before making any investment decision, XY Adviser recommends obtaining financial advice from a qualified financial adviser.