November 1, 2022

#356 Troy Theobald – Transcript

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Ben Nash
Hey guys, Ben Nash from the XY advisor team and today I’m here with Troy Theobald. Troy is founder and head of financial services at RFS advice. He’s won pretty much all the awards that you can win but been regularly listed in Barron’s top 50 advisor, financial standards, power 50 IFA Excellence Awards investment advisor of the year, and a bunch of stuff he’s been in the industry for. For a fair while I’ll let him tell the story on that side, but keen to learn from some of those lessons. And yeah, some of his is tips on how to create the amazing business that he’s done through RFS. Troy. Thanks for joining us, man.

Troy Theobald
Thank you, Ben. And thank you for being nice on the time in the industry that?

Ben Nash
Well, as I said, I’ll let you tell the story. But I know that you got you got a deep experience there, which, yeah, obviously, it’s been a journey in your business. So maybe that’s a good place to start. And no doubt you’re going to tell it in better words, and maybe can you tell us about your, your journey into advice and how you’ve ended up where you are today?

Troy Theobald
Yeah, probably, I mean, staff now have selected as a profession, which is fantastic. But back in the dear old 90s, when I came through and did an accounting degree, and as did a number of the directors on our license, had a similar pathway. We went to university did an accounting degree started in accounting worked out, they expected you to be sitting in a chair at 6am or 7pm. And you weren’t going to be near a client for about 10 or 15 years. Somewhere along that journey. You think this isn’t for me, and luckily the firm I was at on the southern and the Gold Coast, they had a planner who’d come back from Merrill Lynch in Japan and did this thing called financial planning and, and I was the offsider at the time, and myself and my other fellow co directors, Brad wall, met at the very first thing back and advise investment services days in the 90s. And the two two advisors, we were with the two of the largest at the time, and we were the young punks that they thought were there to probably serve them lunch. And I think that’s back when we’re like, Oh no, we’re paraplanners is in you know, sub professionals. So that’s, that’s as far back as it started. And, and that journey then came through working with an accounting firm building, building that business there and then opportunity came up with a much larger accounting firm that was in btw top 100 accounting firm that assured me they didn’t have enough high net worth clients to have an advisor. So I offered even to do tax returns. And within the first two weeks, I was that busy with planning and never looked back. So. So that that ran well, for a decade, they shared the shed, the office took care of that, but it was a bit of a lonely journey. And employee number one still here with me today, and you were a jack of all trades doing everything back then and you do get tired and you get concerned about burnout, you made some right people along the way. And that’s where I actually had met with Paul Forbes, who was GM at professional investment services at that time to, to come over and buy the other half of the business and take that burden off and just allow I like seeing clients, I like managing the portfolios. I’m not overly excited, as Ben has seen me with tech today, there’s lots of things that I’m really bad at. So I love to outsource those. So having that relationships worked really well. We’ve gone from strength to strength there and just really trying to build out that offering along the way.

Ben Nash
Absolutely, we’re just chatting a bit before we find out the recording in your space that you play in is that that sort of pre and post retiree space and talking about your your team structure, you’ve got things set up in a way that allows you to deliver an award winning service, but do it across large numbers of clients in a really effective way. mentioned that you personally the sort of frontline adviser for around 300 clients as well as you know, is heavily involved in the running of your license plus all of the you know, media content team, things that you’re doing and you know, jumping in from time to time on some of the other advisors meetings, how do you structure things to be able to work at that that level of volume, but do it in a way where you’re maintaining the quality that you want to be delivering for your clients?

Troy Theobald
Yeah, so the couple of components I mean, you’ve got to be systemized to do it. So we have we empower the key sort of call it middle management or high management now to control and build the system with the team. And we used to laugh It’s RFS version 10 Version 20 version. So if we get to a point now we got 2021 on staff now, when Paul joined, we had three so we’ve had to change approaches and you get to pressure points and when we do get to those we just literally jump in the room and go where are the pressure points and Paul will do that regularly, probably on six months basis and, and things that work for a team of five won’t work for 10 and won’t work for two Mining, I wish there was an off the shelf solution. In financial services, I haven’t seen one yet love someone to build one, I’ll gladly take it. But they’ve had to adjust it along the way. So we’ve, we’ve built that team approach. Now it looks a lot like accounting firm, where you can have the primary advisor or the senior partner and such, they’ll like fully qualified advisors under them that do 90% of the work in contact with a client and it gives them contact with a client much earlier in their career with high net worth clients, they’re in the room and decisions are made, so makes it a more exciting role for them. And then off the back of that, then we’ll add administration and graduates under that and bring them through that way. So it’s taken us a while to get to that approach, because it’s love to say we tried them all at the start, they weren’t perfectly they didn’t. realities, you try a few things. And, and, you know, we did one of the advisors and we gave her a panel and moved over to the side who was very good with new clients and just wasn’t, wasn’t getting the runs on the board she deserves. She was a better advisor than that. And you sort of realize that there are a lot of those referrals that because Paul and I have been in the industry for a long time. Around town people go, I’ll go see Troy, go see Paul, go see the team. So it’s realizing right, maybe I do need to step back into that role of the meet and greet, and then introduce the team and the quality and, and then coming to the meetings as and when needed as well. But the model portfolios was the key to doing that it took the administration out on the burden. So if I walk in every room, I can ask the advisor, what’s the allocation, and if it’s five in cash, you know, 10, or 20%, in a real return and then coral growth, I know exactly where the money is, and what that clients experience will be before I even open up on the TVs. We have the TVs with live portfolios where we do the reviews. So you’re not getting surprises. And I think that’s the key that, you know, the day of the old rap and master trust and a client having legacy products, you just need to move away from that and move forward.

Ben Nash
Yeah, I think that you’ve got to have that consistency. As for you know, you’ve got to find a way that you do know all of those things. And if you don’t have consistency, then it makes it a lot harder to get there. So what does it what does it actually physically look like the team that that’s underneath you? And how is it structured? You mentioned that you’ve got, you know, a couple of other ARS that are supporting you with supporting your clients, and then there’s admin team, but is it maybe I’m asking this question selfishly, that I might be able to get a couple of tips for our team. But is it a dedicated admin that’s linked to an advisor? Or is it like an admin team that spread across multiple? What is the resourcing look like around that?

Troy Theobald
Yeah, we tried a few approaches that it was more shared when we’re probably up to 10 or 12 staff. And then myself and Darko, the other partner we brought in so he does wealth accumulators. So he did when risk advisor the year and all those things, which for me is fantastic. Because I know I’ve got an expert on tap, he’s going to take care of this. If it’s a client of mine, I’ll literally walk out of the room and grab a coffee and leave him with it. Because he’s his his and his team do that all day every day. So we’ve made sure we’ve got more specialties, we’ve got a team that just do aged care and and Centrelink advice. Same thing, I’ll bring that team in, do the handover out the door, we don’t all need to be doing the same thing. But when the teams do that role and do it every day, they get better at it, they get more efficient. So and the other thing we did is we have a standalone review team that they control review process. So like a platinum client might be every six months, they’ll control they’ll call the meetings, the documents, everything, ensure it’s done, making sure we’re meeting all FTS and all those obligations. So my team is sitting there, personally doing that. So I can literally walk back, grab a pack 20 seconds before a client walks in, I know exactly what it will be returned, the TV’s on, we log into the portfolio, it’s the same experience for me every meeting, and it’s repeatable, and we know where it is. And then I can bring one or the other team and from my team that no they are in their 20s they can sit in front of a client with seven or $10 million them and, and really participate in the meeting and be seen as the go to for for a lot of like those sorts of thought of clients generally a lot further down in your career. I know I have to wait a long time. How do you bring that forward? And it’s it’s really having that team approach. You pick up good tips like, you know, one of my good mates Rob McGregor from GPS welfare. You know, it’s about six, seven years ago, Troy one day, you’re not going to want to kick the goals, you’re going to be so excited when your team kicks them and you’ll be able to clap the code. I’m on like night that will never happen to me. Now I clap I’d rather kicking the ball past here, go go. And you see the joy on their face. It’s probably the you know, you do change as your career goes through. But yeah, from that perspective, adopting that team approach and that’s only what’s coming out of the US that’s what came at some of those barons when you talk to I mean, they’re insane. They manage billions of dollars with three or four people I don’t know how you do that because compliance in Australia up HIPPI ideal client, my team had probably that one to six, seven mil in the 710 mil and above, as they probably got a bit more hands on service in there, those sub that mil that 500 mil we have a team tooled up to do that. Got a female advisor, fantastic. You know, 30s, they’re taking care of those clients, that’s really her sweet spot. And then those that have some aged care entitlements, we do have a designated aged care division, they will do clients that are needing part aged care and part income support there, because they are, they’re tooled up to do that we have some of the people on there, and that’s probably been our busiest team, because we’re, we’re adding to that that’s, that’s probably more our give back. And we’re definitely not the most profitable division in, in financial services. So people looking for somebody to run seasonless aged care, I’ll give you the tip, it’s not it, because it is you’re dealing with families, you’re dealing with Dynamics, it’s very stressful, it’s got to be done quickly. And the actually charges not a significant amount based on what’s going on. But for our clients that we’ve now built to a level, it’s probably our retiree clients are using it for their parents, and they always laugh and they’re in their 60s and 70s, as long as I know, their age gap is probably 20 years to their mom or dad. So they’re dealing with their own routine, dealing with their parents going into that. So we sort of service we needed to provide. And, and yeah, it does add another screen to the boat.

Ben Nash
Totally, it’s crazy complicated that stuff. And that’s just from a technical perspective, let alone the personal dynamics and the things that you know, that got to go around those those decisions. It’s also the sort of thing in my experience that you only really get one bite of the cherry with as well, it’s like, you’re gonna structure things in a way and then you know, it’s gonna happen, there’s no going back from there. So it’s like, you’ve got to get it right at the start. And from the nature of, you know, where people are out at that stage, it’s typically, again, in my experience, I found it challenging for people to accept a fee that’s commercial, given all those those inputs that are there probably helpful if they got their kids, as clients that understand and know you guys are ready that might be able to help or help guide that process. But yeah, I think it’s the sort of thing that you want to have a strong muscle before you start dabbling in there. Otherwise, that can lead lead to trouble.

Troy Theobald
Truly, and from our point, and that’s really where we found that you needed to have a specialty and, and that that’s probably the evolution from a generalist to running all of a practice to picking the areas you enjoy doing, specializing and allowing your team to specialize. And that’s probably the evolution we’ve been on, still on.

Ben Nash
Yeah, it sounds like it sounds like obviously a lot of changes over the time that you’ve been in business to get from the point where you’re, you know, one advisor there, seeing the clients doing all the work yourself to the way that you’ve got things structured. Now, teams teams are teams of specialists in different areas, what what’s been the most challenging part of that evolution for you?

Troy Theobald
Most challenging, it’s a good one. There’s certainly lots and they pop up when you’re not expecting the most powers that can be anything from administration platform, suddenly having issues from nowhere to that it’s, it’s that constant unexpected, I suppose that just kept rearing its head and having the ability to get back up. So I think I think having the right team of people around like we, we move to a license and a co op there, we’ve got a cue from center, we’re gonna have Alesco guys and Jeff and Marshall and Guide Financial at the Sunshine Coast. So having a good team around you, I think it’s been the key, it’s can be lonely out there. Otherwise, advice to them, we came out of professional investment services where we had to really, you know, through the 2000s to probably 28 910, you know, you had big conferences, you had a network, you had a community. And that all sort of fell away when when markets sort of had issues and dealer groups broke up. And then banks move out of industry. And it’s sort of fragmented everyone. So I think that’s where the likes of GPs have popped up in some of those groups to give people a sense of community, we went out with a desire to reduce costs for client reducing margin and everything which was our passionate to build and to do that we needed to be self licensed. And we needed to work with them premium worked with us to get agreements with product providers and pass it back to the client. And then size and scale. Now I think we’ve got nearly a billion dollars between the the offices in our model management approach, and that just gave us more size and scale to reduce that to clients. And now the evolution of that as well. Now how do we actually take that out even further, even to the marketplace or external advisors to us and having a document and going, this is what we’ve built, it’s taken a long time. And as we can get bigger as a group If we can get more discounts, we can pass those to clients and, and here’s the process that evolutions ongoing, and that’s probably taking a lot of focus at the moment how to do that, if we’ve had to change structures and all sorts of things along the way. And, and you know, I think that ability to just have the right people around to get you through because if I look back to 2000 678, you know, I was the classic advisor, there would have been their mid 30s ish and then heading the burnout because you’re trying to do everything. And I went to a conference overseas, and for me, it was the values based advice that was that was, we’re in Hawaii, PI’s had a conference I just grabbed that came back and totally changed the way we did everything from that perspective. And, Paul, same conference, and Ron Calvin presented there, and it was around process and, and this milkshake story used today. And you know, what in your office makes you look silly that you can do that you tell people you can’t and, and we keep those two lanes. So we’ve got passion for different areas. And I think that’s what really works. Yeah, I

Ben Nash
think that balance is important. And also like, having other people in similar on a similar journey around you as well, I know. You know, that’s why that the x y community sort of kicked off back in those early days, but it’s like, if you without the, you know, the being in a bank or being in some big institution that you are sort of just going at it on your own. And one of the things one of the great things about advice is that people are generally pretty happy to share their secrets when it’s helping, ultimately helping you know, the consumers at the end of the day. And that puts things into perspective. Because if you’re just toiling away or on your own, it’s sort of, it’s easy to feel like you’re the only one that’s sort of going through it, but everybody is, is sort of in the same boat so that having good people around you is important, obviously get some good ideas from you know, those other guys Plus, I’m sure he’s probably got good jokes or something that he can add to the, to the to the party.

Troy Theobald
Yeah, and that’s what it is. And then you look at those and that Lockheed, I was around that mid 2000s in there when Hugh and I sort of became mates. And at the time, I’d won a couple of awards, and I was speaking all over the place. And that was really when I was getting tired. And then you get someone to give me that, that sort of pep along, which is good. And like he’s taken up the mantle lamp running around talking about lots of different events. You know, Paul’s done that for a long time. So an alpha and Paul are gonna do that. It’s not that I’m not engaged. By the time I’m running the team. Doing the models have now kicked off a monthly radio show that’s taking a bit of time for retirees. It’s just FM, talkback there. It’s just to give back to everyone’s finding their different ways to do what I’ve just done through the girl school president of the fathers club and things. So I’ve found my avenues for give back there. It’s it’s just as people different people pick up the mantle from time to time to help out other advisors. But you do find everyone’s pretty open and sharing. I don’t I don’t find as an industry or a profession that people aren’t. It’s just probably time Paulus’s what stops a lot of it. If someone wanted to ring up pickier and have a coffee and sends me a message, it’s probably not a problem at all. But from that perspective, it’s just having that time to go out and do it on that. Scale is where people struggle.

Ben Nash
Absolutely. Troy, I’m keen to talk about the Barons list and not so I think it’s obviously it’s great what those guys are about, but just the substance that actually sits behind that. See that you’ve been sort of listed there? Since 2017, or

Troy Theobald
that kind of hold on the Barons list, they brought it to Australia, I don’t know how he first got invited was an invite to, to appear and put figures forward. But it gives you access to some of the some of the firm’s that don’t may not be as engaged in the advice community like maybe the Morgan Stanley’s and, and some of those big, large Macquarie groups that, you know, I tend not to see them at different events. So I don’t I certainly don’t come across those guys. And in function, or like if there’s, you know, many conferences around the place. It has spread that, you know, the broader community just gives you that interaction. It’s probably a different model to what most advisors are running because they’re, they’re large institutionally run groups. Run I think majority of industry have probably, you know, more advisor with a handful of staff depending on different scale and building and growing. So they do run a totally different model. So it was interesting, the same, you know, the trend for them is definitely towards wholesale, larger clients and above. And I think that that leaves a massive opportunity for the advice community for those claims. adds up to probably that one even $2 million, that, you know, we can add a lot of value, they do want and are happy to pay for advice. They’re appreciative. For us, that’s a real sweet spot as a firm because those clients are really appreciative. If you can keep them on track, keep them updated. Show them a strategy, let them know what’s going on. I find that works really well, some of the, you know, the high net worth clients, they come with high needs higher time commitments, as well, which is hard to have a number of those, they tend to be distracted, because they’ve got so many other opportunities and things that are exploring. So yeah, it does just give you a different breadth of knowledge. And, you know, the weird thing is, when you’re finding the style of advisors out there go, well, we don’t deal with anyone now under one or $2 million, it’s it’s sort of a big change from where the industry was five or 10 years ago.

Ben Nash
Yeah, and there’s a lot of those when you actually look at the list themselves, that they people talk about their minimum balances, and where they won’t see clients underneath. And I think a lot of people think that, in order to make a list like that, you have to be dealing with those ultra high net worth or the, you know, the eight and even nine figure type portfolios, but yeah, it sounds like that’s, that’s, that’s not the case, it’s just managing the money doing it at scale.

Troy Theobald
Yeah, from there, I mean, there’s no doubt that those big name brands do attract some of those larger clients, because they’re going for the brand. So that that’s something we’ve got to get over. I’m not sure where we’re ranking size at the coast, but about half and half a bill or more. So my roundabout that depending on markets are doing at the moment, but it’s one of those things, even at that scale, you’re not finding those massive clients just walking in the door going, you know, you guys have got sizes. And I’ve been around a long time. So the name definitely helps.

Ben Nash
Troy, what’s the most difficult skill that you’ve had to master to be the adviser or business owner that you are today?

Troy Theobald
The most difficult skill is when you hand something over to someone, and they’re not going to do it the way you would do it. And that really is a struggle for I’ve struggled with that for a long time. If someone’s doing an 80, or 90%, in my little world of how good it could be, you got to get past those issues. And then then you do find them running with it. And as they get more confident, they’re probably doing a better job than you would do anyway. But in those initial stages, that was really hard to hand over control of different areas and outcomes to people. Once you get to a size and scale of momentum, you’re forced to it. So you’re sort of lean in, as opposed to leaning out and, and yeah, once I’ve got to that, embrace it now it’s fantastic. Like I’m walking to a meeting now. So if I don’t have to be involved in that, that’s fantastic. Whereas, you know, even five, six years ago, I’d be still trying to have an opinion. It’s not just you got this I don’t need to be here doing so it’s, it’s just but that’s the evolution, it’s just having the right people around you as well.

Ben Nash
Any tips on how to like, make it easier to do that? Or it sounds like perhaps it’s just grow, grow to the point where you physically can’t do it yourself?

Troy Theobald
I think it’s just accepting and recognizing it. We weren’t put ourselves through this INSEAD program around biases and things and you know, it’s a bit of a look in the mirror. And it’s like you should be done. And like things your own way and all those things inside. Yeah. Okay. But I’m still probably, I don’t know, I don’t sit still. So I’m, I’m still in the door here by you know, pop are seven 530 to six. I’m wandering outside, I don’t find it a chore coming to work. I don’t. I like things to be done. When I go home. I used to take work home, I don’t know I will not work. So when I go home, I’m home. That was one one good tip I picked up somewhere that probably there was a reasonable period of time. I wasn’t as present as I should have been in my own house. And he’s sitting at a conference and someone stands on stage as your family getting the best or the worst. Anyway, crap, you got me. Yeah, I’m running in the king dinner, chucking the headphones on and playing on the computer. And, you know, this is exciting bill. But when you got kids and everything there, they just want dad to be around and your wife wants you to be around. So they’re little things to learn along the way. Hopefully, you learn, learn and improve but it’s it’s still still a process. So for me, that’s why the, you know, the radio community get backing on the coast or the being the father’s club, get back at the school so that I can be a bit more present. Now that I’m in position I can whereas, you know, kids were born I was probably in the office line. I was in the office the next day, because you’re having that conversation in life and we know what pays the bills and this client needs this done and as A couple of years, you just have to do what you need to do as businesses grow. Thankfully, you’re not quite as time strapped for those situations.

Ben Nash
I think I’ve sort of inadvertently stumbled on an effective strategy for being present at home, which is have your kids so close together, that your wife just can’t deal with them all on her own. You sort of forced into making sure that you’re home for dinner and bath time and all the rest of it, but I still I still do some work from home, but I don’t work in the evenings anymore. And I found that that helps a lot with that, that President presence and making sure that they aren’t getting the best of you, at least most of the time. Probably my last question for you. If you could, if you could go back to your 1990s as you put itself and and like fresh faced in the, in the advice game and give yourself one piece of advice. What would it be?

Troy Theobald
Oh, that’s a tough one. I suppose it would be just as I went to a presentation the other week, and it was a was the head of Bonn University, talking about the hero’s journey. And I wish I’d heard that years ago. Basically, we look at all sorts of stories, there’s the ups and the downs, and everything in that in the end, and hopefully it all works out in the end. And it’s just accepting that it’s a journey more because sometimes it can feel really, you know, Adversity is just coming at you. Why is this SOA, why do we need to do this? Why? Why do I need to go back? Why do I needed? Like, oh, my god, I just want to help these people in front of me, why can I help them because I have to give them 80 pages and a big bill. Once you’re accepting of what is there, and moving forward, I think that’s probably where I’m better at. And I certainly I was terrible at it for a long period of time. So once you accept and, and work with what’s there, then everything becomes easier, it’s easier to find solutions when you’re not yelling and complaining at the problem. And it’s those things you can’t control and change that are put upon you. And I think it was like when we all wanted higher education I want I don’t want people walking in my door, having had a horrible experience sold a product that was inappropriate, that shouldn’t have been done, I want them to walk in. Either they’ve got new money, those, they may have had an issue with advisor on service or something. But fundamentally, the advice was good. And that that’s where we get to and hopefully we do there’s less of those issues. But you do still see that walk in what was the pain we have to go back and do more study. You know, I had a business degree a DFP, a CFP and weren’t able to study there and 20 plus years of CPD each only from the tests are accredited, whatever. But, you know, we went back and we did the ethics and we did the Facilier exams, and we were just rolled with it said, we’re just going to embrace it. And hopefully the outcome is a better industry and the industry is an enter profession. And when we’re there then we’re all happier. And I think the carnage has been the number of advisors left but hopefully the quality that is left there for the right reasons, delivering better outcomes to more Australians. And if we get to that then then that’s great for everyone.

Ben Nash
Yeah, well I think that now it’s like the people that are here at people that are committed to stay and it doesn’t guarantee success but I think it does help with ensuring that more people are getting better advice outcomes more often and I think that’s what leads to that that more of the groundswell and getting that getting past that you know, one in five number that they talk about with Australians getting financial advice, something that I feel like we’re sort of seeing seeing shift at the moment so I think it’s an awesome time to to be in advices that filter through Troy thank you so much for for sharing your insights Yeah, so so much gold there really really appreciate it I know that you’ve got your got plenty of plates you keeping spinning so appreciate you taking the time

Troy Theobald
out thank you and yeah, people like yourself need to keep spreading the word and spreading the message and sharing with advisers out in the community cuz look COVID created really bad habits and made it really isolating for lots of people. So I applaud you on continuing to do that.

Ben Nash
I know Yeah, I think we’re all but some rebuilding to do after being bunkered up for for such a long period but starting to get there more and more stuff happening. So get around it and as you say that sharing that knowledge helps us all be better and have that sense of community as well as we’re following that hero’s journey as you say as well. Troy thanks again mate and team we will catch you on the next one.

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