Welcome, everyone! Welcome to the 69th episode of the Financial Advisor Success Podcast!
My guest on today’s podcast is Barry Glassman. Barry is the founder and president of Glassman Wealth, a wealth management firm in the Washington DC area that serves 250 affluent families and has grown to nearly $1.2 billion in AUM in barely 10 years since Barry broke away from his former hybrid broker-dealer firm.
What’s unique about Barry, though, is the amount of time and energy he spends focusing on building his advisory business as a business, including why, even though he’s been nominated to most of the industry’s “Top Advisor” lists, he’s most proud of the purposeful culture that’s allowed Glassman Wealth to win a local Washingtonian “Best Places to Work” award.
In this episode, we talk about Barry’s approach to differentiating his firm by doing what he calls “interrupting the pattern” from what clients and prospects are typically used to, which includes his website home page that leads with the message “It’s not about pie charts” and even lists some of the competing firms he refers prospects out to, how he records a quick personal video for every prospect before he meets with them, why he doesn’t give out gifts with the firm’s logo, and how he differentiates himself in his relationship with attorneys, accountants, and other centers of influence by engaging them more proactively than the pattern they’re used to with most other advisors.
We also talk about Barry’s unique philosophy in deciding how to service his clients and connect with prospects in the first place, where he starts with the mental exercise of pretending they’re the only client or prospect the firm will meet with all year, figures out what that client would want and expect, and then working backwards to figure out what the firm can systematically execute on and deliver, using technology to help personalize the experience, for each and every client of the firm’s 250 affluent clients.
And be certain to listen to the end, where Barry talks about where he goes to get inspiration as an entrepreneurial business owner, why he doesn’t go to more than one financial advisor conference every year, and why he thinks it’s so important for advisors to look outside the industry for real perspective on entrepreneurship.
So whether you are interested in learning more about growing a firm after breaking away from a broker-dealer, why it is important to “interrupt the pattern” of what your clients and prospects are used to, or how you can differentiate yourself by engaging with centers of influence more proactively than they’re used to, I hope you enjoy this episode of the Financial Advisor Success podcast!
What You’ll Learn In This Podcast Episode
- Barry’s gripe about the Barron’s Top Advisors list. [4:09]
- Why he is more proud of winning a Washingtonian Great Places To Work award than making the industry’s top advisor lists. [10:49]
- How the culture of a firm can have a direct impact on clients reaching their goals. [13:23]
- Why Barry looks for people who invest in themselves when interviewing job candidates. [15:15]
- Why Barry says it’s so important for advisors to look outside the industry. [20:59]
- One of the best questions to help convince a prospect to sign on. [24:24]
- Why the thing Barry fears most is missing a strategic planning opportunity. [49:12]
- The size and structure of Glassman Wealth today. [47:05]
- Why the firm stopped sending logo items to clients years ago—and what Barry recommends sending instead. [32:09]
- Common mistakes advisors make on their websites. [52:50]
- Barry’s advice for getting clients to find you. [1:02:26]
- How Barry defines success. [1:35:56]
Resources Featured In This Episode:
- Barry Glassman – Glassman Wealth Services
- CommunityMade Podcast
- Office Lens App
- Nerd’s Eye View: CNBC List of Top Fee-Only Advisors Who Aren’t
- Financial Planning Association
- Office Lens
- Heckerling Institute
- Junxure CRM
- Community Made Podcast by Jayson Gaignard
- TED Talks
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Full Transcript: Interrupting The Pattern With The Philosophy That Each Client Is The Only Client with Barry Glassman
Michael: Welcome, everyone. Welcome to the 69th episode of the “Financial Advisor Success” podcast.
My guest on today’s podcast is Barry Glassman. Barry is the founder and president of Glassman Wealth, a wealth management firm in the Washington, D.C. area that serves about 250 affluent families and has grown to nearly $1.2 billion in assets under management in barely 10 years since Barry broke away from his former hybrid broker-dealer firm. What’s unique about Barry, though, is the amount of time and energy he spends focusing on building his advisory business as a business, including why even though he’s been nominated to most of the industry’s top advisor lists, he’s most proud of the purposeful culture that’s allowed Glassman Wealth to win a local Washingtonian Best Places to Work award.
In this episode, we talk about Barry’s approach to differentiating his firm, by doing what he calls interrupting the pattern from what clients and prospects are typically used to, which includes his website homepage that leads with the message, “It’s not about pie charts,” and actually lists some of his competitors that clients can be referred out to, how he records a quick personal video for every prospect before he meets with them, why he doesn’t give out gifts with the firm’s logo, and how he differentiates himself in his relationships with attorneys, accountants and other centers of influence by engaging them more proactively than the pattern they’re used to with most other advisors.
We also talk about Barry’s unique philosophy in deciding how to service his clients and connect with prospects in the first place, where he starts with the mental exercise of pretending they’re the only client or prospect the firm will meet with all year, figures out what that client would want and expect, and then works backwards to figure out what the firm can systematically execute and deliver on, using technology to help personalize the experience for each and every client of the firm.
And be certain to listen to the end, where Barry talks about how he goes and gets inspiration as an entrepreneurial business owner, not by going to financial advisor conferences, and why he thinks it’s so important for advisors to look outside the industry for a real perspective on entrepreneurship.
And so with that introduction, I hope you enjoy this episode of the “Financial Advisor Success” podcast with Barry Glassman.
Welcome, Barry Glassman, to the “Financial Advisor Success” podcast.
Barry: It’s fun to be here. Thanks, Mike.
Michael: I’m excited for this episode because we’ve kind of crossed paths for, I don’t know, probably the better part of 15 years now. You know, I’m based here in the D.C. area, you’re based here in the D.C. area. You know, I think we first crossed paths at probably, like, local FPA National Capital Area at, like, the big two-day annual chapter symposium event that they used to do back in the early 2000s.
And, you know, you were working for one, you know, pretty large and well-known hybrid firm here in the area, and then I knew that you’d gone out on your own, like, not long after the financial crisis, I think. And then I have heard recently that you guys were passing $1 billion under management and I was like, “Wait, I don’t think he’s even been out 10 years.” Like, “All right, we’ve got to talk, what the heck is going on over there that you guys are growing really fast and really well?” And I know you’ve always had kind of an interesting take on the industry. I suspect we’ll slay a sacred cow or two in the discussion today. So I’m really excited to have you on and maybe kill a sacred cow or two.
Barry: Sounds great. Sounds great. Where do we start? And who’s talking about me?
Michael: So who’s talking about you? You meet with people.
Barry: The people.
Barry: People. Yeah.
Barry’s Gripe About The Barron’s “Top Advisors” List [4:09]
Michael: People. People are talking. And as I’m sure, you know, you occasionally bring on yourself with little things. Like for anybody that wants like a fun good intra-industry laugh, you go to Barry’s homepage at glassmanwealth.com. And the landing page just says, “It’s not about pie charts.” And then there’s a little button that say, “Then what’s it really about?” Which I think is a not very kind way to point out how many of us tend to still use pie charts as the focal point of our meetings.
Barry: I’ve gotten to a little bit of trouble recently. Not trouble, but I wrote a piece. You know, Barron’s, we wind up on these lists, and if you’re not on the list, you want to be on the list. Anyway, Barron’s came out with their list, and I’m on it, and I’m grateful to be on it, but I wrote a piece all about how awful this list is and how much of a disservice it is. Which is so weird because of course, I wanted to write that before I was ever on the list.
Barry: And then a senior editor of the list called me, or sent me an email saying, “Hey, can we chat about this?” So sometimes I’ll…and you do this as well. I’ve seen it. Actually, you did it specifically with a list of somebody that I know who listed, we don’t need to mention it, but, “Here are the top fee-only advisors.” And of the top 10, none of them or 1 of them was a fee-only advisor. So you and I both share this kind of commonality of calling out BS or, you know, inauthenticity. You know, just other areas where, “Come on guys. You know better than this.”
Michael: All right. So then I’ve got to ask, so what’s your gripe about the Barron’s list? Is this sort of back to the criticism I know a few people have put out as well of like, it’s basically just all about AUM measurements. How much AUM you have doesn’t really measure how good of your firm you are? Like, is that your issue with it?
Barry: Oh, it’s worse than that. Oh, it’s worse than that. It’s the top two criteria. And by the way, I’m not making this up. It’s on their site. The top two criteria for their filter happens to be assets under management and revenue generated. And by the way, they can’t ask our clients how great we are or not. They can’t look at performance of the average Morgan Stanley broker versus Pinnacle Finance. They can’t do that. All of these lists have to base it on Washingtonian, base it on who of your friends would recommend you in the accounting and attorney world.
So Barron’s does it with assets and revenue. Figuring that if you’re good, people will keep their money with you and you will attract more of their money and things. And therefore, that’s how you show your success. And I look at the list, much like you do. We look at things similarly. And when you look at the state by state list and you look at, I think it was the…in Washington, D.C., Washington is not a impoverished city, would you agree?
Michael: Oh, we are obnoxiously expensive here in the D.C. area and kind of lift all the local salaries up to the point that you can hopefully afford to live here.
Barry: Yeah. And even hire an advisor. So in D.C., they listed, I think it was 20 or 30 people and not a single one of them was either a hybrid or an RIA. All of them were with one of six brokerage firms. And they all had billions under management and they’re really great people. Number one I know him. You know, I’ve referred to him, nice guy. But can you really say that if you’re going to name the top financial advisors in each state that the District of Columbia is not going to have a single hybrid or RIA? Are you really going to…?
And by the way, I think that in D.C., Maryland, Virginia, not even the Washington area but the tri-state area of the, and I’m making up this number, but I don’t know if there were 50, 60, something, maybe a bit more, I think there were 3 women or 4. But it was kind of an embarrassing list. And I wanted to point that out. You know, “I’m grateful to be on it, thank you. You need to improve this.” And, you know, he heard me. And he said, “My next trip to D.C., I need to meet with RIAs, you know, independents and such, and have them apply because they’re not.” And I hope that they have assets or revenue to make that because people read those things. So yeah, I find things and I get into…much like you, I get into a little bit of trouble.
Michael: Yeah. Although, you know, I do have to admit, I don’t know, playing devil’s advocate a little bit around this issue in particular, like, the one thing it does hit home for me is it is kind of the reminder of how unbelievably large the top wirehouses actually are, that I feel like sometimes we don’t quite see in the independent channels. Like, Merrill Lynch and Morgan Stanley each are north of $2 trillion of assets under management in their…I think just in their brokerage wealth management divisions. And between the 2 of them, it’s something like 30,000 registered reps. And just to put that in context, like, the entire national independent RIA community is only estimated at a little more than $4 trillion…
Barry: Yeah. And those are two firms.
Michael: …and 20,000 or 30,000 independent RIAs. You know, Schwab is the largest independent RIA custodian, and the Schwab Institutional business has barely half of what just Morgan or Merrill do. And Fidelity is like 30% or 40% behind that. And, you know, like, TD Ameritrade Institutional is like one-fifth the size of one wirehouse.
Barry: And a sheer number of brokers who have $4 billion under management as part of their team, it’s not 100-person firm like you and I would know, you know, firms in the RIA space that have $4 billion under management, it’s a wealth management team made up of brokers within Merrill or Morgan. So it’s impressive. But if you’re going to take on the responsibility of naming the top financial advisors and putting that out there to the public, I just hope it would have a broader representation.
Why Barry Is More Proud Of Being A “Great Place To Work” Than Making The “Top Advisors” List [10:49]
Michael: Well, and which is a fair point, right? Like, one of the, I don’t know, I’ll call it like unfortunate challenges of that kind of concentration is, you know, if you want 100 independent RIAs on the list, you’ve got to call 100 firms. If you want 100 advisors from the top 4 wirehouses, you just have to call 4 PR people who are going to give you a giant list of names. Which I suspect is part of why, you know, those lists end out with the concentration that they do. You know, you just need one PR person in each firm nominating hundreds of local advisors and they end out dominating the list, whereas the RIAs have to do it one RIA at a time to apply and split their names.
Barry: Yeah, yeah. So you’re right, sometimes I shoot some sacred cows or ruffle some feathers, whatever analogy you want to do.
And with the lists, as you and I were touching on earlier, you know, while it’s fun to be on those lists and it can help business and things from credibility, you know the lists that I think are most important. And those are, you know, in my opinion at this stage, the best place to work, culture-based lists. Those are the ones that I strive for and are really the most proud of.
Michael: Yeah. Well, and I know you guys have…I know you’ve been on Washingtonian’s list locally here in the D.C. area and I think “Washington Business Journal” as well. And, you know, it’s something that I think we don’t spend a lot of time thinking about at advisory firms, or at least, hey, it’s nice to get awards, whether it’s, you know, largest firm, top advisor or best place to work. But I feel like most of us it’s just, “If it happens it happens. It’d be great to get on the list.” We don’t necessarily have like a proactive strategy for it. Well, especially since the advisor lists are all just, get more assets and revenue anyways and then you get onto the list eventually. But, like, how do you think about, you know, top RIA lists versus best place to work lists?
Barry: Oh, every time I would take the best place to work, every single day. I think that when you look at the criteria for Washingtonian for example, and we get probably more business from Washingtonian’s top financial advisor list than almost any other thing locally, but Washingtonian best place to work, so much more important to us. And I think that culture of the firm can have a direct impact on clients reaching their goals.
How Culture Can Have An Impact On Clients Reaching Their Goals [13:23]
Michael: All right, so explain, what do you mean by that? Culture of the firm can have a direct impact on clients reaching goals.
Barry: So you were touching on, you know, a lot of people don’t have a strategy to make the list, but I would love to see more firms strive for having a purposeful culture, for putting people in positions to thrive in their roles, to have a culture that’s purposeful. Everybody has a culture, it just may not be purposeful. And what we did was, we surveyed our clients, we surveyed the employees and learned a ton, an absolute ton. And what we learned about the employees and what really makes us special is the curiosity that we have. And one example, I’m not blowing smoke but, you know, one example is two or three people at the firm every now and again will say, “Did you see what Mike, you know, wrote about?” So people are reading and wanting to learn more. They’re going to conferences wanting to learn more. They’re reading. So they’re curious people.
Oh, and by the way, it also applies to clients as well. Meaning they’re curious about looking at their tax return. They’re curious about reading the estate planning documents. They want to learn more about this and that and that. That’s a culture. And once you know that, you can encourage it, you can reward people based on it, you can highlight it, you can hire for it, you can fire because of it. Once you identify culture, it’s so much easier to have the right people in place and then train them, promote them and let them thrive. It’s something I always kind of knew, but four years ago we went through a purposeful exercise with a consultant and really highlighted it, and it changed our business completely.
Why Barry Looks For People Who Invest In Themselves [15:15]
Michael: So can you talk about that more? Like, how does that happen, right? Like, I get it, you know, our culture is to be curious, but, I mean, like, what does that mean? You know, “Dear Jimmy, you haven’t been curious enough this quarter so you’re on probation. If you’re not curious again next quarter you’re getting fired?” How do you operationalize that into a firm?
Barry: Sure. Sure. Well, where does the curiosity, you know, sit? Let me rephrase that. Each year, what are you hoping to learn this year? Where are you going to learn it? And it’s not which conferences are you going to, what do you want to learn? See, there are a lot of people who graduated from a great college with a great GPA, got a master’s from another great college with a great GPA, and they’re done. You know, I listened to your Caleb Brown podcast on the way to work this morning and was, unfortunately, you know, so long. I was sitting in the garage, you know, listening to it while…
Michael: You were really supposed to break that up over two to three drives because I know traffic is bad in the D.C., area, but it doesn’t take that long.
Barry: It’s not Kitces-podcast bad.
Michael: No, no. It’s not. Yeah. I think only Atlanta and LA are like Kitces podcast-level traffic.
Barry: Yeah. So we’re not going to hire based on college or GPA, I want to know, what have they learned recently? How have they invested in themselves recently? How do they look at return on investment in their own time to improve themselves?
So here’s an example. Let’s say somebody graduated from college, you know, a few years ago, how much do people spend on college? Let’s say they graduated sometime after 2010.
Michael: Tens of thousands of dollars.
Barry: For four years of college.
Michael: Oh, God, I mean, what? State schools here in Virginia, you’re probably out $50,000 or $60,000 over 4 years.
Barry: Okay. So, I mean, that’s on the low side. That’s fine.
Michael: Yeah, I mean, that’s in-state.
Barry: So let’s throw in the opportunity cost as well. You work at the gap, you would make, I don’t know, $20,000, $30,000. Let’s throw that in as well. So it’s well over $100 grand.
Michael: Yeah, easily opportunity cost.
Barry: Well, over $200,000. Let’s call it well over $200 grand. So you spend all that money, yes, to have fun, yes, to get life experience, yes, to grow more mature, all those great reasons, but where are you spending your time and money today, or in the last year to learn more? And that’s where…you know, there are online courses, there are classes you can take, there are conferences to attend. Why wouldn’t you take three days to… how much is the FPA Conference?
Michael: Oh, God, what? National and barely 1,000 bucks. You can do National Capital Area local stuff for a couple hundred.
Barry: Yeah, but the national one, where you go and network and that. Why wouldn’t somebody join that? Why wouldn’t somebody as a student spend a little bit more money, and it’s only like $75 or so, I think maybe less, to join as a student and join the FPA and learn what financial planners are learning in the real world? That small incremental extra effort and some dollars can go an enormous way. That’s the kind of stuff we’re looking for when we’re interviewing people.
Michael: And so, like, you’re asking questions in this direction, like, you know, “What have you done to reinvest in yourself lately?” and see what.
Barry: “What have you learned? What do you want to learn? What do you want to learn?” You know, Candace in my office, she is going for her enrolled agent. Did I ask her to? Is it a requirement? No. She wants to learn that. And does she want it just to get the EA? No. She wants to learn that stuff. And then when she’s done with it, she wants to learn more about international estate planning and tax. We haven’t had some World Bank folks. We haven’t had some international couples and things. She wants to learn about that. Are we going to have a specialty and a whole group division? Probably not, but she’s not done. It’s not like she’s going to get the EA and then that’s it. And that’s an example where each and every person here, we’re just curious and we want to know more.
One of the interview questions I ask is, you know, “Tell me about an app that, you know, you use so much or you love so much you tell all your friends about.” And for years, by the way, it was Waze. It was just everyone saying, “Have you seen Waze? Have you this?” And we’ve asked, some people said, “No, not really,” or, “There’s an app that does this.” I said, “Really? Have you used it?” “No.” The people we want working here are curious enough to either learn about new apps from friends, learn about tools and things.
And there’s somebody recently I interviewed, “Tell me about a really cool app that you’re sitting in a Mike Kitces talk. And of course, he’s got PowerPoint with a whole bunch of stuff up there. He forgot to include something in a handout. You put your phone up, take a picture of it, and it gives you a perfectly formatted PDF. Not trapezoidal, you know, where, you know, because it’s the screens above you. It’s a perfectly shaped and formatted.” And he showed it to me. He said, “I’ve been to seminars and in class and things and this is what I use all the time just to capture it so I don’t miss it.”
Michael: All right, do you remember what it was called? Because now I’m just actually really curious to go and get this.
Barry: Hold on. I actually have it on my phone. Hang on.
Michael: Oh, there you go.
Barry: Yeah, it’s called…
Michael: Because you’re a curious person so you downloaded it so you would have it the next time you’re sitting in one of my presentation.
Barry: It’s called Office Lens.
Why It’s Important For Advisors To Look Outside The Industry [20:59]
Michael: Office Lens. All right.
Barry: Office Lens. And you can also take pictures of documents. And regardless of how bad your aim is at an angle and things, it just puts it into… So these are the kinds of people we want. We also don’t want people who are so focused on finance. I go to one financial conference a year. Every other conference I go to is something outside of our industry focus. I don’t want to learn from…I don’t want just the people here to learn from other financial firms. I want to learn from others and bring it back…other industries and bring it back to the financial industry.
Michael: So then what do you go to? Like, what are you finding that’s meaningful? I feel like for most of us, just there’s a never-ending list of best practices we could get better at just going to industry conferences and trying to take home some best practices and implement them. So, like, what are you going to instead that’s more meaningful for you?
Barry: There are a couple of them, but a lot of them are entrepreneurial-focused. That’s for me. Others here will go to Toastmasters or Dale Carnegie and really speaking and those kind, you know, putting themselves out there. We’ve had people go to Tony Robbins, we’ve had people…you know, all kinds of things. I suppose estate planning is still our industry, but Lindsay in our office, she’s not an attorney, I don’t know why, she loves estate planning. So she goes to one huge estate planning conference down in Florida every year. And she’s one of the few financial planners who are there because it’s all attorneys.
Michael: Yep, Heckerling down in Miami?
Barry: You’re exactly right.
Barry: Yeah. I’m sure you’ve been there and spoken there or…
Michael: Well, it’s really true. Like, Heckerling is, you know, like, that’s a conference where people like to…like, they all know the Treasury regulations and the Internal Revenue Code sections off the top of their head, and they’re just kind of citing it from the podium. Like, it just kind of works. “And, well, you know, and 1.401(a)(9)-3, Q&A part 2.” And on the sentence goes. And, like, that’s their thing. So, like, even for estate planning, like, not for the faint of heart.
Barry: Yeah. So the people we hire and the culture that we strive for is for Lindsay to go there, learn a ton, get added experience, but then bring it back here, and in the best way possible, share with the rest of the team so that we can apply it to all of our clients. And that’s really the key. So whether I’m on an entrepreneurial something or Lindsay is at estate planning or, you know, somebody is at a Tony Robbins, they can come back and take us through an exercise that brings it back here and we all benefit.
Michael: So you actually have like a structured, “Hey, you went to the conference, present out to everybody else on the team about what you learned at the conference?”
Barry: It’ll be a couple of things. It could be a presentation. We do a lot with video, so she may just do a screen capture and walk us through, “Here are five things that I found fascinating at Heckerling, and I think that this can benefit our clients in these ways.” And maybe it’s five things on same-sex couples, and, you know, “Here’s where we can really get in trouble and here’s where we really need help and here’s what you need to look out for.” And we’ll all interpret these things in different ways. But she is not going to come back and share the 126-page PowerPoint and say, “This is what I learned.” That’s not going to work.
One Of The Best Questions To Help Convince A Prospect To Sign On [24:24]
Michael: So the idea of it is just to have a firm full of people that are curious and continuously learning because over time they just compound more knowledge and skills and ideas that you get to implement with clients.
Barry: Yes. And keep in mind that the curiosity doesn’t stop with learning from outside the firm, it also is curious to, “What else can we learn about the client?” Meaning, you know, you’re in a client meeting and yeah, you could end because they’re happy with the performance, because things are going well and so forth, but, “What about your grandchild with special needs? How have your kids provided in their estate planning documents and can you help guide them?” You know, curious people don’t just give up, they’re persistent and they ask the next question.
One of the greatest, Michael and I hate to give this away. Well, no, no, no, for your audience, I’ll give this away. But one of the best questions to help convince a client to sign on is, “When is the last time your broker asked to see your tax return?”
Michael: “When is the last time your broker asked to see your tax return?”
Barry: And what’s the typical answer?
Michael: Never or maybe once years ago, but probably never for a bunch of them.
Barry: Yeah. Yeah. You know, we have a curious team. We look at all of our clients’ tax returns, anyone who will let us. I think there are a half dozen or so that say, “No, I want to keep that.” But no, we either find errors, we find that there are opportunities, there are things that we didn’t touch on or talk about, and we add so much more value by looking at that. Mike, if you were going in for surgery and you knew that an extra MRI wouldn’t take so much time, give you radiation, so forth and, you know, it’s not going to discover some false positive, but it’s just going to help the surgeon do his or her job, would you do it?
Barry: Well, that’s what looking at the tax return does. It gives us another angle to understand somebody’s finances. And, you know, we don’t mandate to the team that they must look at clients’ tax returns, we just do it. That’s a curious culture.
Michael: So are there other like pieces or aspects or kind of framing words for your culture besides curiosity or is that, like, the thing you’ve attached to and built around?
Barry: It’s three. It’s smart, innovative, and personal, you know, wrapped in curiosity as well. We really do, and this gets into what you and I had touched on and I sent you earlier, which is, you know, the kind of one-client philosophy. Which is, “How personal can we make this experience? How personal can we make the guidance and the totality of what we’re doing for you and your family?”
Michael: What does one-client philosophy mean?
Barry: Well, I’ve always been fascinated with the extremes. And I even remember in geometry class in like seventh grade or something, I had Mr. Vieira, and in any of his formulas and different things that we had in geometry, he would take it to the extreme. “So what if we had this here and the line went out forever?” Or, “What if this was zero, what would that do to the equation?” I’m a calculus engineer nerd, so you’ve got to deal with me. And I still believe that in business as well, and I’m fascinated, for example, with concept cars. What if you were building just one car? We weren’t worried about mass production. We weren’t worried about transporting it, “Where would it get me?” We just want to make one. And we want everything to be over the top and we want to experiment. So just what would we do if we had one car?
Well, why can’t we think about that when we think about clients? What would we do if Mr. and Mrs. Jones happen to be our only client? Would we only call them once a year? No. Would we call them every day? What if we had no other clients? We had nothing else going on, do they want to hear from us every day? No. So there’s a right amount that they want to hear from us. How do we determine that? You ask them. And you constantly… “Are we meeting frequently enough?” How personal would the experience be?
You know, Mike, I assume you send out quarterly performance reviews.
Michael: Yeah. For Pinnacle, yeah, at least kind of a notification. There’s another report we at least stopped mailing. We at least stopped mailing them.
Barry: Yeah. No, no, but it’s posted to their portal and…
Michael: And it’s part of the regular billing process.
Barry: Yep, yep. So what if a client wanted something monthly, and instead of the standard, they wanted either deeper or they wanted more of a summary? What if one spouse wants something more simple than the other one? Well, with FinTech nowadays, we can customize it. If this was our only client, we’d make sure that they had the information they needed when they wanted it, in the form that they wanted. If they want it mailed, if they wanted online, if they want a PDF, we would provide it to them. Well, if we had one client, we would do that. Why can’t we, with Junxure, Tamarac, Black Diamond, whatever software you use, what’s keeping us from doing that? In the end what we learned was, well, nothing. Nothing. If somebody wants to go deeper, if somebody wants more time periods on their report, we’ll add it.
Now, we’ll keep somebody…we’ll encourage somebody to not change it every week and month and so forth and tweak it and, you know, drive us nuts, but why not ask, “What would you like, and how often would you like it?”
Michael: Well, and I feel like the challenge for a lot of us really is, like…so it’s one thing if I’m running a solo firm on my own, because, you know, if it’s just me, like, if I want to do something different for every client, I’m the business owner, just me, I’m inflicting this on myself, for better or worse, I can do whatever I want for every client.
You know, the piece that worries me about this, just like wearing my business owner hat at a firm like ours, you know, Pinnacle, we’re closing in on $2 billion under management, probably about 1,200 clients or so. So anything I think about doing, particularly at a level of customization, like, if I’m going to give people the option to change a report or get it monthly instead of quarterly, like, I have to have a system and an exception system for who gets quarterly, who gets monthly. How do we toggle between them and make sure that it’s properly tracked across 1,200 individual households? Which at best gets daunting.
Barry: So here’s where if you had one client, of course, you do it. At 1,200, it’s impossible, but how close can you get to it? And that’s what’s fascinating to me. So let’s say instead of customizing it for each client, you went to your client and said, “You know what? Not everyone wants the same report. And what we learned from some focus groups was that here are the four that clients want most often, which one would you like?” And you have A, B, C, and D.
Why Glassman Wealth Stopped Sending Items With Their Logo On It [32:09]
Michael: Now, that I can get on board with. I can sell that to some partners in our firm, right? Like, I can’t.
Barry: Yeah. So remember, if you have six clients or like we do, we have 200-something clients, yeah, we’ll do that, and most of our clients will take the basic one. But when somebody comes to us and they’re looking at monthly statements every month from UBS and that’s how they judge everything and we say, “You know, there’s something better. If you were to design something from scratch, what would it include every month?” And he would say, “Well, I end up doing a spreadsheet and doing the math and it’s hard to figure out the performance.” “What if you had that every month, what else would you want to see?” And chances are it’s already information we have in Tamarac.
And with the portal, it’s easy once a month, on the 8th or 6th of the month, we just hit a button and any monthly report just gets uploaded, just fairly simple. So there’s not more information that we wouldn’t want on there, it’s just what are the time periods? “Well, I’d like year to date. Like, prior 12 months. I’d love since we started working together.”
We had one client who actually challenged us. He went to Michigan, she went to Ohio State, said, “Well, we want our school colors. Guess what we did. Guess what we did. We put the damn school colors on. He gets one, she gets the other. But once it’s done, it’s done. It’s Tamarac and either, “Okay, so this is the Michigan…this is the University of Michigan report. UM report and OU report.” That was fun, but now it’s done. And every time they get it they say, “Oh, they’re paying attention to us.” So really challenging yourself, what would you do if you only had one client. And then what wouldn’t you do if you only had one client? Well, you wouldn’t send a newsletter. Remember, you’ve got Mr. and Mrs. Jones, are they getting a newsletter? No, they’re getting something more personal. And that’s what we try to do.
Would you ever send them logo items with your logo all over it? Do they need a mug with your company’s name on it if they’re your only client? No, they can buy their own damn mug.
Michael: An interesting way to frame it. Like, what would you do that is still meaningful and is not meaningful if you had one client?
Barry: Yeah. Well, if they’re going on vacation and they’re traveling to Tokyo, well, I happen to travel a ton, I know the best…and one of the greatest thing, you know the adapters that you use for, you know, plugs and things?
Michael: Yes. Yeah.
Barry: Well, one of the coolest things…
Michael: Like multi-multiplugs.
Barry: Right. But the coolest thing to do is buy them a multiplug, lightweight power strip that has three plugs and four USB ports so that you don’t need multiple adapters and things, you just have this one little travel thing that’s really light. You plug it into the wall in any country, and you’ve got all the plugs. And guess what? They don’t need to have my logo on it. If they can’t remember who gave that to them to simplify their lives then, you know, that’s okay, I’ll deal with that. But we stopped sending logo items years ago.
Michael: Why not? I mean, like, I get the thing but like why not also put your logo on?
Barry: Okay. So once I put the logo on it, they know, because these people are smart enough, that I ordered a bunch of these, and it’s not necessarily special for them. You know, and one of the examples I use is, you know, estate planning attorney, great referral source for us. For us to send a logo item to an estate planning attorney, let’s say I send a…well, give me an example. I have six of them but can you give me an example of a logo item.
Michael: Oh, God, what? You can do coffee mugs, T-shirts, pens.
Barry: Okay. So back up, back up. So a coffee mug, and you know the big muckety-muck, you know, estate planning attorneys in this area, are they going to really use my logo coffee mug?
Michael: No. At best I’ll get it into the company kitchen and maybe an associate will use it.
Barry: Right. Right. And wait, can they afford their own coffee mug? But what if there was one really cool coffee mug that cost a whole bunch more, and instead of ordering 50 of these coffee mugs and sending them out to everybody, you just bought one or two? You’ve seen on Kickstarter and other places really cool umbrellas that can do X and Y and Z. Does that estate planning attorney want to walk around with this innovative umbrella with your creepy logo on it? Probably not. If it’s different enough and they’re going to tell their friends about it because it opens the other way and you can get into your car and you don’t get wet, they’re going to remember who gave it to you. You don’t need your logo all over it. That’s not going to lead to a client.
Michael: So the goal is, like, give something that’s distinctive enough that it’s memorable just because it was distinctive and it’ll be associated with you anyways, and then you don’t even have to plaster your logo on it.
Barry: You got it. You got it. Once you put your logo on it, they know you’ve sent it to a lot of people. You know, during Snowmageddon a couple of years ago, what do we have? Like, 2 feet of snow here in Washington. We had a week’s notice. So for every client and estate planning, an accountant and all of those folks, on that Monday, you know, the snow hit Thursday night, on that Monday morning, we knew that everything was going to be closed. It’s Washington. We get a little wind and they close schools.
Michael: Oh, yeah. We close for snow forecasts. It doesn’t matter if the snow comes.
Barry: Exactly. So what I sent was, I sent to everybody, and, you know, my receptionist and administrative assistant, two different people, they went online and spent the day sending from Amazon, with two-day delivery, puzzles and hot chocolate. And, you know, “Hope you stay safe and warm during Snowmageddon. This should help with the boredom.” Did it have our logo on it? No. I don’t know how many pictures emailed to me, some right away like Wednesday, I’m like, “Wait a second, the snow didn’t even hit yet and you’re sending.
Michael: Yeah, but it’s chocolate. You’ve just got to start drinking hot chocolate.
Barry: What was incredible, some people aren’t puzzle people, some people aren’t hot chocolate people, but at least everybody was one. So these cost I think $18 plus free two-day Prime delivery, and it was better than any mug or logo. Our clients are still talking about it. And by the way, we sent cool puzzles with like retro candy bars and things like that. Things that were nostalgic for our clients.
Here’s another example. One of our team members, “Okay it’s tax time, let’s go ahead and send something to the accounting, the accounting firms. Let’s go ahead and send them some because they’re really busy and that.” And you’ve got to realize that they’ve got tons of food. They’re working their tails off and other people might be sending baskets and things, good luck, during tax time, what if we send something in May and we were the only basket that showed up? And what if we didn’t put our logo on it but put a note that said, you know, “Here are healthy snacks for…” What are we calling it? We’re calling it, you know, tax time recovery kit.
So, you know, yeah, you can send stuff with your logo all over it and this or that, but if it’s just going to blend in or wind up in the kitchen cabinet with everything else, that’s one thing. How do you stand out? And you stand out by doing something that can work on its own without the logo.
Michael: Right. At the core, you stand out by doing something that’s different. I mean, that’s the essence of differentiation.
Barry: And that has to do with, what if you only had one center of influence? What if you just had one? Would you really send them a logo something or would you know that they were going to Japan and send something that they can really use? What if you had only one prospect and a prospective client called you, what email and letter and personally recorded video and landing page would you set up for them prior to coming in?
Michael: And is that stuff you are actually experimenting with doing now? Like, personally recorded video?
Barry: We are.
Michael: So what does that look like?
Barry: Exactly. “Hey, Mr. and Mrs. Jones, I know you’re coming in next Wednesday, really excited to see you. I know that you’ve dealt with this firm or, you know, large brokerage firms in the past, what I’ve done is I’ve set up this page for you just so that you would realize the difference of the kinds of ways in which we work with clients. And the first thing that you’ll see on this page is you’ll see what a fiduciary is. And it’s just a quick explanation of what a fiduciary is. Next is a Forbes article that I wrote all about the gap years in between your retirement at age 66 next year and the age 70 and a half when you have to start taking required minimum distributions. There are some great planning opportunities there. So I wanted you to have this. And then what I did was we’ve had prospects over the past 20 years who have asked common questions. Things like, “What do you charge? Do I get statements? Do I get performance reviews? Who do I deal with at the firm when I have questions? Who’s part of my team?” What we did was we were completely transparent, and you’ll see all of those answers below. I hope this is helpful. I also have a space below for you to fill out additional questions that you want to make sure that we cover during our meeting.”
Now, Mike, let me ask you something. If they’re meeting with three or four firms, and here’s the term, do we interrupt the pattern from the firm that just sent a confirmation email with directions?
Michael: Yeah. Drastically.
Barry: How much does it show that I want that client to join Glassman Wealth? I care. It’s all I did. I showed that I cared, and I’ve got time…by the way, I’ve got time for you. As opposed to, you know, an administrative person sending a confirmation email.
Michael: Because literally, you do the little video.
Barry: Yeah. And how long does a little video take?
Michael: I don’t know. So I was going to ask you, like, how long is the video? How long does it take you to do this?
Barry: It’s three minutes. And it’s always set up. So you walk over and, “I need to do a piece.” And maybe by the time your podcast launches, I’ll have a link to the equipment and stuff that I use, but it’s easy. You go, you do three minutes and it’s done. So if you had one prospect, wouldn’t you show that you’re interested? Wouldn’t you spend time to learn a bit more about them during the initial call? Doing some research online, those kinds of things. Yeah.
Michael: So you have like a standard space set up in your office so you can just like walk over in front of a camera that sits on a tripod and do little three-minute videos of each prospect that’s coming in?
Barry: So the answer is yes. We have set up a…because you know I’m a photographer and so I’m able to…you know, I have studio lights and all of that stuff. I’ve got 4K cameras and that. We don’t use any of that stuff anymore. I bought something called a Deskview, which is an awesome…it was an awesome Kickstarter. In essence, it’s a shelf that suction-cups to the window. And in essence, you’re supposed to put your laptop on it. And you work while you actually have a view, as opposed to your current office where you’re looking away from the window. But what’s incredible is the lighting is perfect. It’s as good, if not better than my studio lights. So I have this Deskview set up in the conference room.
Barry: I bring my laptop over. I don’t use the camera on the laptop. The Logitech ones or the Logitech HD ones are better. I put that there. I make sure that I have a good sound, so I have a lavalier that just plugs into the side of the computer, and I’m done. I’m ready. Record it, send it. It’s just that easy. So to record personalized videos just couldn’t be easier.
Setting up a landing page, that’s a bit tougher and you need somebody in your office to actually have the template and be able to set that up. But, you know, if you had just one prospect, why wouldn’t you do this? If you really cared about this prospect and wanted them to sign on, it doesn’t matter if they have $50,000 or $5 million or $50 million, it’s 5, 10 minutes. You’re going to spend 2 hours in the meeting with them and probably prep work for a second meeting, why not take 5, 10 minutes and really gear them up to come in and be impressed? And when they come in, they know you.
Michael: Right. Because they’ve seen you, they’ve seen the video, like, there’s kind of an interesting aspect to this of like, what would you do for one client? One client, one prospect, etc., but then you still do ultimately take it to the next level, which is then, “How are we standardizing this across the firm,” right?
Barry: Oh, yeah. Remember a concept car, they don’t do everything in the concept car and just bring it into mass production. No. They invented airbags in a concept car. Well, it was years later that they brought it into the S model Mercedes, and then eventually it worked its way down to every car on the planet. It takes time.
But what if you had one prospect, what would you do to impress them during the initial call? You know, when they call, well, how does the receptionist answer? You know, “I’m a prospective client and I’d like to talk to Barry.” “Oh, we love prospective clients. Barry is busy right now. Can I transfer you over to Gabe? He knows everything about the firm. He can actually find out more about you, you about the firm, and we’ll set up a time for you to chat with Barry if it makes sense. And if it makes sense we’ll…” So Julia is empowered. Remember, because we’ve been waiting around for this one prospect, just one. We’ve been waiting for it, so she’s empowered to handle that. And that’s different than somebody who calls a firm and they say, “So-and-so Wealth Management.” “Hi, I’m a prospect.” “Okay, please hold.” Really, really different.
What Glassman Wealth Looks Like Today [47:05]
Michael: So talk to us a little bit about just the firm, the size, and the structure. Like, you know, how big is the firm? What kind of clients do you serve? Get us oriented a little on, like, the metrics and structure of the firm today.
Barry: Sure. So we have a little bit more than 250 families we serve. We only serve families. Yeah, we have a few 401(k)s, we have a few foundations, but usually, they’re tied to, you know, the partners of the firm or the matriarch or patriarch and therefore the foundation. We really focus purely on families. We have about $1.2 billion under management. We have seven, will soon have eight client advisors. And what’s fascinating is the goal hasn’t been necessarily that, “Let’s take on more and more and more clients.” We happen to do that. The goal is to have fewer clients per advisor over time. And we’ve gone from, I don’t know, 90 or 100 clients per advisor. We’re currently I think below 40.
Michael: I was going to say, like, 250 families and 7 or 8 client advisors, like, your clients per advisor numbers are way, way lower than most other advisory firms.
Barry: Well, and that’s purposeful in that… and by the way, there’s no right answer to this. People think that there’s one way that’s better than…there’s no right answer. The hope is that it’s purposeful. We want to do more and more for each client. And, you know, people argue about, you know, client minimums and things. I’ve never fired a client because they no longer met a minimum, but I’ve had a $2 million minimum for at least 10 years. And what it does is it limits the number of new clients that we take on so that we actually have time for them. And our goal is to, again, have curious people, find out a ton of information and strategies, and then have few enough clients to apply them to each family.
Why The Thing Barry Fears Most Is Missing A Strategic Planning Opportunity [49:12]
Michael: I guess the flip side to this as well, so 250 families and $1.2 billion of AUM. So I’m, you know, doing my rough math here, like, you’re at just shy of $5 million per client household on average. So, like, you’ve got a pretty affluent clientele. An advisor might only have 35 clients but they may still have like $150 million to $200 million under management. Just more affluent clients and fewer of them so that you can service them more? Is that how you would think about the business as well?
Barry: See, I don’t use the term “service.” And I have on my website, I mean, because I actually spoke about this and then somebody said it’s on my website. You know, the whole service or customer service, it’s more of the sophistication and strategies. Meaning, you know, what if we combine, you know, your required minimum distribution with net unrealized appreciation? You know, what if we miss that opportunity? You know, what if we don’t title this in tenants by the entirety or give this, you know, stock that we believe will do really well? What if we give that to, you know, a trusted… You know, I think what I fear most is missing a planning strategic opportunity for a client.
You know, the service side, in my opinion, is the minimum standard, meaning calling them back, you know, proactive phone calls, those things. It’s, “What’s the right number of clients to read every estate planning document?” To find that, you know, “Hey, did you know that your brother is still the successor trustee and you mentioned that he has cancer? Does it make sense to have somebody else listed there because that’s the only person listed?” That’s what really drives us. And we found that at this level of client assets, that’s where it fits.
Michael: Interesting. I do like the framing that, like, service is a minimum standard. The sophistication and the strategies are the value-add? As opposed saying, you know, service is the value-add. You know, “We call you back faster than everybody else does.”
Barry: Our “about us” video, I actually really enjoy…you know, there’s a bunch of, you know, backs…what am I looking for? You know, kind of industry mocking kind of thing. And I say in the video, narrating it, “Great customer service is a minimum standard. Why wouldn’t we call you back right away? You know, why wouldn’t we execute the wire that we…” When you think of customer service, and I remember a friend of both of ours, I said, “How do you describe your firm?” And he’s talking to me. He’s talking to me. “We have white glove customer service.” And I really almost spit out my soup that I was eating at an FPA function. And I couldn’t believe…
Michael: I’m just envisioning them actually like, “Do you order the gloves in bulk or do you get them customized to each employee’s hands?”
Barry: Well, I’m thinking, are they rubber latex gloves? I don’t know what gloves they are. I’m just like, “Really, that’s what’s going to set you apart?” It’s no longer customer service. When you think about Amazon, Zappos and so forth, that’s our standard now. So as far as getting back to them in such…we have to differentiate ourselves. And the way we do it here is through thinking. I was going to say sophistication but it’s not. It’s thinking. It’s thinking, “What else? What else could we do for this client? What else can we think about?”
Common Mistakes Advisors Make On Their Websites [52:50]
Michael: I guess with the caveat like, well, it’s hard enough to prove you’ve got better service than another advisor. Like, how do you show a prospect you’re thinkier than everybody else?
Barry: Well, and that gets to a talk that I gave last year, which was, “Don’t tell them, show them.” And too often on our websites, for example, which is our potential clients’ first experience with us, we’re telling people, we all tell them the same…Mike, what do we all tell clients on our website? Go ahead.
Michael: We are fee-only fiduciary RIAs who provide comprehensive financial planning and investment management service with years of experience and credentials and great service for all of our clients.
Barry: Okay, that was really good. That was awkwardly good.
Michael: I think I got every buzzword in there, right?
Barry: Yeah. Yeah. And whose website could that be? Every single person listening.
Michael: Right. Yeah, at least every RIA listening. Yep.
Barry: So what if we took every single phrase that you said there, that we believe is important and we show people on our website that? What if when we say that we’re objective, we go online and say, “Here are the ways in which you could do this. And by the way, here are some great links that aren’t Glassman Wealth or Pinnacle. They’re places for you to go to enroll in the T. Rowe Price Maryland 529 plan.” It shows your objectivity. “You don’t need to do this through me. This is easy. Here’s the information, go do it on your own.”
What if you show that you’re smart and innovative on the website by saying, “Hey, here are the gap years in between this and this. If you’re this age and, you know, you have required minimum distributions coming up, you may have an opportunity for these five tax things. Talk to your accountant about this.” You show them those things. We say that we’re transparent, well, is there any greater way in transparency than naming our competitors on the website, which is what we do? Do you know of another firm that does that?
Michael: No. Like, somewhere on your website there’s a list of like, “Here’s the other firms in our area?”
Barry: Yeah. We’re not right for everybody. “We hope you choose us, but in case you don’t choose us, here are the people in the area that we know personally, who have a great reputation. I think will do a great job for you, without caveats. And here they are.” And what’s incredible is I hear from…it’s like, “Why would you do that? Why would you give that?” Well, do I really believe that if I don’t put that on my website people won’t know and they’ll only show up to Glassman Wealth and they won’t find another RIA or hybrid? I’m just not that naive. It’s out there. How can we show that we’re transparent? I said, “Let’s give this away. Just give it away.” And people in my firm really questioned me on it, but I said, “How do we show this?”
Michael: But it is a good point. And, you know, I’ll admit I’ve joked about it internally for our firm a few times as well over the years, that like there’s this…I don’t know, there’s this concern of like, you know, “We hope we’re the only one going for the prospect and that they’re not comparing us around to others.” And I’m like, “Wait, we work in an affluent area that has the highest rate of graduate degrees per capita, I guarantee you they’ve already figured out how to Google, you know, “financial advisor D.C. area” or “financial advisor Columbia, Maryland,” because that’s where we are. And we already know who the other firms are in the area that we compete against most commonly.
And so, like, yeah, I hear you. I think sometimes we kind of fool ourselves like, “If we don’t point out to the client that they could do some of this directly on their own then maybe they won’t realize it.” It’s like, we work with pretty smart people, I’m fairly certain they can figure this out on their own, which is fine. What it means is if they’re hiring us, they’re hiring us for some other reason. Like they trust us or they want to delegate it or there’s something else that’s a constraint on them that means they don’t want to be doing this for themselves even though they could. So we don’t have to pretend like we’re the only thing out there. Let’s just come at that directly and say, “Yeah, you know, you could do this yourself, and here’s what it would take. And if you don’t want to do that and you value your time differently, like, here’s what we’ll do for you.” And have that conversation. Like, just give them credit for being smart.
Barry: Actually, I would phrase it differently. See, I think you should go one step further, which is, don’t say, “Here’s what we would do for you.” I would actually show them the things that you do and, I mean, you do it to the nth degree. I mean, I don’t know many people who read through the entire tax bill.
Michael: Yeah, I know. That was a dark weekend.
Barry: Yeah. You know, that was for you like most people go through draft time for fantasy football.
Michael: Yes. That is a very good analogy.
Barry: To the family, “Don’t bother me. I’m at the laptop. You don’t understand.” And that was you. But what you do with that and the sophistication of it, of, “You don’t realize that this tax thing and this,” and you combine this thing, anyone who reads that, Mike, would say, “I couldn’t do that on my own.” And you’re not allowed to say on your website, “Hey, guess what? You can’t do this on your own.” You can’t. But what you can do, especially at your level, and I mean it, is show them, “Here’s the way we think,” and let them interpret, “Okay, is that…do I mesh with that or I’m not interested in it?”
Michael: Well, and likewise, you know, that’s…you know, while the blog is written primarily for advisors, you know, as folks know, like, I’m a partner back to an advisory firm as well, and so we work with clients. And I get these questions a lot of like, “Do you ever actually get clients off your website because it’s written for advisors and, you know, everything is so ungodly long that not even every advisor wants to read it?” And, you know, what we found having done this for years, like, it’s absolutely true that like 99.9% of consumers are not going to read through most of our really long and dense stuff, but we found out there’s one type of consumer that does, people who are really smart and sophisticated and have so much money that they care enough about these problems to actually read long articles, and then realize they need help.
Barry: True. And also, don’t the articles also help you through, and we can touch on, you know, media, but doesn’t it also help to give you credibility, and especially credibility 10, 15 years ago? Because I don’t know exactly how old you are, but I do know that 15 years ago you were younger. That back then, it really helped as you were blogging and flying around the country speaking to other advisors for a nominal fee, no offense, but back then did nominal fee, it was helping to ingratiate yourself with credibility builders, meaning the media.
Barry: So maybe it’s two steps removed, but it still helped.
Michael: Oh, absolutely.
Barry: As opposed to you calling up and saying, “You should quote me,” you’re coming up with just a constant flow of ideas for investment news reporters or, you know, Forbes or “Financial Planning,” other magazines to just, “Okay, Michael will know about this.”
Michael: Yeah. It’s a powerful effect. But the philosophy even that we take with it, for which I still get grief except we know it works because we track the metrics, like, just the phenomenon of, you know what? Like, give all the information away for free. The reality is it’s on the internet already, and anybody who’s going to find my stuff by searching on the internet was by definition already searching on the internet.
Barry: Great point. Yeah.
Michael: So only one of two things is going to happen. They’re going to find the information from someone else and either do it themselves or work with that person, or they’re going to find my information, realize it’s better than anything else they were able to find on the internet, and I have an immediate, demonstrated competency with the prospect, which means we get really warm prospect calls. You know, the bad news is they don’t always…
Barry: Or you’re just at least invited to them. You’re just one of the three. Okay, so you weren’t going to be one of the three, and now you are. So now you have a chance to meet them.
Barry: You also…you’re somebody in what you do and your longer form, which is different, you interrupt the pattern. And I love that term. You’re not yearning to be different. You’re not looking to stand out. You’re you. You know, wearing a blue shirt and the whole thing, but you’re interrupting the pattern when you go from site to site to site or Google some topic about an IRA and you find something from 2012 and this and this, and you wrote something last week, and it links to other IRA articles, you interrupt the pattern of what other firms and other thought leaders are doing. And I think people appreciate that. That it’s not the same.
Barry’s Advice For Getting Clients To Find You [1:02:26]
Michael: So where does all the prospecting and activity come from for you guys? That, you know, you’ve…well, I know you started almost 10 years ago, although you were breaking out from another firm in the area and, you know, correct me if I’m wrong, I think you had some subset of clients that came with you. But, like, where does all this growth come from over the past 10 years or so? Like, how are you actually getting clients to find you and read all the fun stuff on the website about your competitors?
Barry: Yeah. And it’s really a couple, but it’s referrals from clients and centers of influence. We’ve done a really good job with, and it’s kind of the secret sauce, and I’ll give it away, you know, for you is we make sure that the accountants and attorneys see the work we’re doing for clients. See, you’re either one of a couple kinds of firms. You’re either an investment-only-focused firm, and okay, and that’s a niche and so forth, and you’re doing the investment side. But you still have the 1099, and you still could send it directly to the accountant. You still could before you invest. You know, for example, we’ll engage the accountant and say, “We’re about to realize $40,000 in capital gains, how do you think that’s going to impact the client?” And clients, by the way, love this, the fact that their two advisors are working together. And you know who does this with accountants? Not brokers. Brokers don’t call them before they do anything.
When you lower your fee for a client because they rolled over their huge 401(k) and you’re lowering the fee, let the client know and let the accountant know. No one does that. So we do a better job with the centers of influence, the other client advisors, knowing what we’re up to. We’ll also invite them to meetings. We’ll have more in-depth meetings. And when an accountant has 100 different financial advisors or brokers and there’s 1 or 2, we don’t need to take them to a hockey game or be best friends with them, but when they’re handing out 3 names, we just want to be invited to the dance. And that’s really helped.
The second thing is through online. I mean, it’s just incredible through online search, through various lists such as “Washingtonian” as I mentioned earlier and those kinds of things. Yeah, people will get four referrals from friends, but they’ll also do a search online. And if you interrupt the pattern and speak in your own voice online in an engaging way, you’ll probably be invited to the dance. You’ll be one of the three or four. And you’ll be included and, you know, hopefully taking on another family.
The other thing is, you know, we’re not looking for 50 new clients a year, we’re looking for 14, 15. So if you’re looking to take on a little more than one client a month and you have all the resources and time to do so, you can really get creative on how to go about it. And that’s why I hope people think about this. That you don’t need 100 clients a year, you need 1 a month. And once again, take it to the extreme. If you had nothing to do but take on one client a month, could you do it? And then the question is how? What are the eight ways that you would go about it? And then figure out what’s most worthwhile.
How much is a prospect worth for you? Let me rephrase that. If you were to compensate somebody, you know, a $2 million client comes on board. A $2 million client pays what percentage in your business or in an average business?
Michael: Oh, God, I mean, $2 million client for most firms, 1% fee, maybe a little lower with breakpoints. But, you know, a lot of advisor firms it’s probably a $15,000-plus annual revenue client.
Barry: So call it $15,000 a year. So if you were to make an investment, this is a real challenge for me, and it’s something that, you know, doesn’t keep me up at night anymore, but it’s really just always something I’m thinking about. If you were to make an investment…oh, by the way, and a client at Pinnacle or an average firm stays a client for how many years?
Michael: Oh, yeah, we’re 98%, 97% or 98% retention rates, right? So like 30-plus years.
Barry: So can we say at least 10 years?
Barry: So if you had an investment that was going to pay $15,000 a year for 10 years, by the way, potentially growing in size each year, potentially.
Michael: Right. Markets rise on average.
Barry: Markets, maybe they have other dollars, maybe they save, all kinds of things. What would you pay for that investment? What’s a reasonable amount to pay for an investment that’s going to pay $15 grand a year?
Michael: I mean, it’s immense, right?
Barry: Yeah. Would you pay $30 grand for an investment that pays $15, 000? So here’s the question. Where would you allocate $30,000 to try and take on 1 client? What kind of marketing? What kind of expertise? What kind of person? And that’s how I’ve always thought, including when I was cold-calling 20-something years ago. Okay, this sucks, where would I spend $5 grand or a grand, $1,000 to not have to go through this? Because if I sign on a $100,000 client, I pay $1,000 for some sort of marketing or seminar or mailing or something to do that. So the constraint in our business to grow our businesses is not money. Would you agree with that?
Michael: Yeah. With the caveat that if you actually get good enough at this, the constraint becomes money only because you want to back up the truck and pour it on, right? Like in that world, as you just said, like, imagine if you came up with some marketing event, marketing strategy, marketing thing, where if you spend just, just, just $10,000, you get a client who’s going to pay you $15 grand a year for an average of 10-plus years. So you start getting like, “How many times would you write a $10,000 check?”
Barry: No, no, no, no, you went to scale. And don’t go to scale, just go one.
Michael: Well, I want to go to scale.
Barry: I know you do.
Michael: Like, I want to back up the truck now, right?
Barry: Don’t ruin it. Don’t ruin it. Let’s go one. Where would you spend your first $10 grand? Because remember, the first $10 grand, it may not work. It may not work. You may have that seminar and it snows. You know, it just may not click and you may need to learn from it. But where would you spend your first? And it doesn’t matter if it’s $1,000, $5,000, $50,000, $500,000, where would you spend it to either grow or enhance your business? And that’s how I’ve…for 20-plus years, that’s how I’ve thought.
Michael: Well, I think the gap for most of us, for starting my career, and I think for most of us that have been in for well, certainly,10 to 15-plus years, even a lot today, like, I didn’t even think of marketing costs in terms of dollars. Like, I was trained to think of marketing costs in terms of time. Like, smile and dial. You know, play, you know, Nick Murray’s game of numbers, right? Like, how many dials can you make? How much time do you have to make the dials? If you’re not getting enough clients, put in more time dialing. And, like, it was all an expression of time and who was the best at converting their time into clients and what strategies work. Like do you cold-call? Do you do seminar events, which have a little cost but it was mostly about the time and the numbers you could put through the seminars? Are you going to, like, walk up to storefronts?
I knew a guy years ago that made almost all of his business in a fairly small town. He would just walk up and down Main Street at 6:30 in the morning. Because what he found is the only people who are out and about on Main Street at 6:30 in the morning are the business owners getting their shops open and ready. And when you’re there that early, the gatekeepers aren’t out yet. So you can get to the business owner directly. And that was how he did all his prospecting. He prospected from, like, 6:00 till 7:30 in the morning and then wrapped up his day. But, like, it was all in terms of time, not in terms of dollars.
And to me, it’s fascinating when you start putting it in terms of dollars, right? Like, you know, a good affluent client might pay you $10,000, $15.000, $20,000 a year. That’s a big client for most firms, but they’re out there. So like, if you could get one of those and it cost you $10 grand but you figure out a way to do that repeatably, like, you’re minting money. You’re minting money at that point. Like, every $10 grand you spend, you get $15,000 annually recurring.
Barry: You still want to send a logo mug to your attorney?
Michael: Yeah, fair point.
Barry: Okay. Or do you want to send the $90 umbrella that is going to stand out and interrupt the pattern and he’s going to show off to his friends?
Michael: Do you like to just shop on Kickstarter for, like, client gifts?
Barry: Oh, well, I’m a curious guy so I’m on Kickstarter all the time. And yeah, if I see cool things. And our clients have something in common, they all travel. And I travel as well, so yeah, when I see cool gadgets and things. For example, there’s a…and we tested. We tested five of them, lens attachments for cell phones, for camera phones. One that does wide-angle and this and this, and, you know, some of them are bulky, some are… Well, we found the best one and so we bought, you know, two dozen of them. And when I ask clients, “Where are you going next?” “Well, we’re going to the Amalfi Coast,” And we said, “What camera are you taking?” “I’ll just shoot with my iPhone.” “Great, we’ve got a gift for you on the way out.” Doesn’t have our logo on it. It’s tiny. And Mike, what does it cost? It doesn’t matter. Whether it costs $15 or $60. By the way, it’s not $400. But whether it’s $15 or $60, it’s a client that’s paying us $15 grand a year, and this is going to enhance their experience.
We also give them a little tutorial on ways to use their iPhone for photography. Things like the HDR setting. “And by the way, take your shirt and wipe off the lens because it’s got stuff from the bar you were in last night.” So they’ll remember that when they’re shooting pictures. The next time we see them, “You’ve got to see,” or “You have to see the fisheye picture I took at Machu Picchu.” I’m the one they want to share it with. It cost $23 for that lens thing. It didn’t have our logo on it.
Michael: So as you look at the business, like, how do you describe the world of, you know, financial planning, investment management, wealth management? Because I know you’re all about interrupting the pattern. So when prospects are coming in, I get you want to be, you know, hopefully, one of the three at the dance to get it. Just to get a chance to be in front of a prospect and make the case to do business with them, but what does it look like when you’re actually sitting across from them and making the case to do business with them? Like, do you have a different spin on what financial planning and wealth management is or is it, “We’re going to deliver it to you in a different way because of our culture?”
Barry: We’re going to think about it differently and in refreshing ways. And that’s not a line until it gets specific. So when a client signs on board, we have an early engagement strategy the first 100 days. Because we want to make sure when they sign on, how many times are they going to switch advisory firms or sign on with an advisory firm? Not that many. You know, we sign on, you know, a dozen or 2 dozen clients a year, maybe you sign on 100. But for this client, this is it. So you want to make sure that they understand the process, that you personalize that experience.
We have an early engagement meeting with them, we call it a foundation meeting, where we don’t talk money, or at least we don’t look at their statements. And so where we really talk about, “What does success look like?” What do they like to look at? This is where we design their performance reviews and things. You know, what can go wrong? What’s gone really right in the past? We get into some of the…what is it? The life planning. Kind of, you know, just, “What are the goals? What if this money was to triple, how would your life change?” And when somebody says, “I would stop working,” well, let’s dive into that and see if you can stop working sooner if that’s really important. Other people would say, “Nothing at all.” So we have whole-in early engagement process.
The other things that we’ve done is we’ve really enhanced what it means to be a client and that client experience. Not customer service. Remember we already touched on that. But for example, so Mr. and Mrs. Jones are coming in. They like to come in twice a year. They told us that and that’s the cadence that seems to work for us. And this is the meeting where we’re going to focus more on the estate planning and a review of insurance and a variety of other things. But they’re coming in next Monday, so this Wednesday they’re going to get a 10-minute video that we’re going to create with a software called Snagit. It’s not expensive. It’s easy to use. It’s basically a screen capture software. The cool part is if you wanted to include your own face in it, you can, and it’s so gosh-darn easy to do. You click “record,” you talk them through it.
And basically, we walk them through in 8 or 10 minutes, “Here’s what’s going on in your portfolio. This is doing well, this isn’t. Here’s a return year to date.” Here’s all the stuff that you would do if you were in person. And we send it to them six days before their meeting. We do it through a site where, you know, is password-protected and we actually take it down two weeks later so that in case that site gets…you know, there’s a breach, that we don’t have years’ worth of videos there. So they’re able to watch that when they want, where they want, on the device that they want. And even for our hard-of-hearing clients, we add subtitles so that they can get the most out of it. And our meetings are so much more productive, “Thank you. That was great.”
Another benefit is for clients where one of the other advisors is really taking over the lead, and, you know, yes, they want to know I’m still in the picture. For me to on the investment side, record that 10-minute video, “Hey, I’m not going to be in this meeting coming up, but I wanted you to just see what’s going on in your portfolio and what we’re looking at.” And we’ll do this randomly.
Interest rates jumped right after the election. People thought their bond portfolios had plummeted. Well, we own some core bonds, but we also own high-yield, we own foreign, they were both up. “Your bonds are positive.” “Hey, I know you’re worried about bonds and the bond market is negative, let me just walk you through in five minutes just to show you how you’re positioned in your own portfolio.” And you do that same video for, I don’t know, 20 people in a day. Takes you two hours, and it’s all personal. And it blows our clients’ minds, especially when I’m not the lead in the relationship, “But I got Barry to dive into my bond. I had no idea. And if I look at the Schwab statements or online, I would have no clue that that was going on.”
So we’re looking to constantly innovate. The way I think of us versus, you know, some other firms is other firms, they really haven’t changed in the past 8 or 10 years at all. And when you think about those kinds of firms and what clients or families are used to nowadays. In your car, do you have a navigation system?
Michael: No. My car is too old. It predates navigation systems.
Barry: Okay, I’m hanging up.
Michael: I buy old cheap cars. I’m cheap.
Barry: Hold on, does your wife’s car have a navigation system?
Barry: When is the last time that navigation system was updated? How old is the car?
Michael: Oh, God, car is two and a half years old. I’m not aware the system has ever been updated since we bought the car.
Barry: Right. Right. And there’s a whole place right across from Rio in Gaithersburg called Downtown Crown with some great restaurants and things. Not a single one of those streets is on your wife’s car’s navigation because it was built in the past two years. You use Google Maps or Waze?
Michael: Yep. I just live in it. Yeah.
Barry: Yeah. And how often is that traffic updated? Like, once an hour or once a day? What do you think, on your app?
Michael: It looks like, yeah, continuously. I’ll watch it…you know, watch it one real time and change my route while I’m on the way because a new accident just cropped up.
Barry: This is what people are used to, and we need to be nimble and constantly update our firm to be the latest. Not greatest or, you know, anything grandiose, but we have to be current. And we can’t just leave, “Well, this is just the way it’s been done.” We have to innovate and think of new ways to do things. And I wish more firms would invest and think this way.
We opened the firm, we were using Junxure CRM. We’ve been in business eight and a half years. We used Junxure CRM, we moved to Tamarac CRM, we moved back to Junxure CRM because we really don’t get into what…we believe it’s better, and we’re going to use what we believe is the best thing. And it was a pain in the neck to switch, and it cost us a couple grand, but we want what is going to help us be the most efficient and do what’s right for our clients.
Michael: So that brings up to me an interesting question, which is like, you know, particularly when you get into technology, like, changing systems is an expensive pain in the butt. Not even just the software cost but, you know, transition projects and, you know, burden on staff’s time and consultants to help make sure it goes right and just, like, all the…and the training. Like, all the ancillary stuff is way more expensive than just the new software itself. Is this just sort of a reality of the firm, everyone needs to be prepared? Like, “We’re constantly going to be making some of these changes and it’s going to feel like things are always breaking and changing, but hey, you’re curious so hopefully, you’re good with it?”
Barry: No. I like the way you put it. Yeah, exactly. Well, you’ve got to remember, it’s much like renovating your home. And I don’t know how extensive you’ve done a home renovation. And it’s always challenging to bring up this analogy because more than half the people had bad experiences with home renovation. But you can do simple things like painting, recarpeting. You can even, you know, redesign a room. You could do all-new furniture, all of those things. And then there’s the load-bearing wall, which some people look at and say, “No, no, no, no, that’s a load-bearing wall, you can’t.” Of course, you can. It’s just more expensive and gets messier.
Michael: So you like to move load-bearing walls from time to time.
Barry: Well, the question is…here’s the question, Mike. What if we moved it, how much would it cost, and what’s the pain in the neck? But what’s the result? And if the result is, “Wait a second, we’re going to have this open kitchen and we don’t need to move, and we’re able to enjoy it far more for the next 10 years until our 2 kids go off to college,” you know what? That’s worth it. I’m going to spend an extra $20 grand to put in a steel beam that’s longer to move this load-bearing wall, given that you can trust somebody with what they promise, and therefore it’s going to be worthwhile.
So people have to know, “Yes, this is going to be messy and costly, but what’s coming at the end of this?” And what came at the end of moving back to Junxure was we were able to send videos or just pieces on, “Hey, you happen to own these two funds and I thought it was important for you to know how they work together.” And we could send that video or article to people who only own those two funds, or own those two funds. So when Mr. and Mrs. Smith get it, “Hey, Jill and Joe, I thought you’d be interested. You own these two funds, thought you’d be interested in this video,” very different than a newsletter. That efficiency was worth the pain in the neck to switch back.
When the firm is looking at it that way, that this is going to keep us from getting client calls and we’re going to keep more clients and we’re going to interrupt the pattern because clients are going to get… You know, somebody comes out with, you know, the one-page fact sheet at the end of the year for Templeton Global Bond, “Hey, by the way, did you know this is negatively correlated to interest rates? Fascinating. Here’s why.” I don’t use “negatively correlated to interest rates” when I talk to clients.
Michael: It’s okay. We’re all with you on the podcast. Yeah.
Barry: Yeah. But for us to take that two-pager and walk them through it and what you find interesting, and be really transparent, “This fund is expensive. I apologize. There isn’t one like this that does exactly this, and let me show you why.” And it’s four minutes. But with Junxure CRM, we can send it to only people who own that fund. What I’m working on is getting the data to show when they originally bought it so that in the email we can actually put, “You bought this back in February of 2012, you’ve owned it…” Or you can say, “You’ve owned this for five and a half years, I thought it might be helpful to X, Y, Z.” That’s how we’re using FinTech, mass personalization so that the client gets the benefit from, what we’re talking to one client, we can apply to all of our clients. I can’t believe we have talked this long. No one is going to listen this long.
Michael: Time flies. You know, you’d be amazed how long people stick with the podcast, particularly because we can actually see that data from iTunes about how long people stick with the podcast.
I do have one or two questions here for you just sort of…
Barry: Go ahead.
Michael: Yeah, sort of forward-looking as we come to the tail end. You’ve talked a lot about kind of always be innovating. And so I’m curious for your views on this relative to what seems to be one of the hot topics in the industry right now, which is kind of business models, fee structures, you know, are robo-advisors going to compress the cost to zero or just is investment management getting commoditized to the price of zero? Like, what does the business model look like for you guys? Are you AUM fees? Are you planning fees? Are you retainer fees? And, you know, do you look at this as like a interrupt-the-pattern opportunity or a place where you’re comfortable because it works?
Barry: Great, great way to put it. I think that I believe that investment management will be free, and it’s coming soon, sooner than most people believe. What’s the lowest cost index fund right now? Three basis points?
Michael: Yeah, I think so.
Barry: Yeah. And it’ll be Amazon. Oh, I’m so glad this is going to be recorded because I haven’t done an article on it yet, but I want to say that I said this, you know, before it came true. But Amazon will come out with, if you’re a Prime member, you can choose one of these five lifestyle strategies or balance strategies, and they’re free. And, you know, they’ll make their money on securities lending or on something else or on the Prime membership. But, you know, when they bought Whole Foods, the question that scared the heck out of everybody is, “What happens when you’re trying to compete with a firm that…” I’m sorry, “Trying to compete with a grocery store that doesn’t need to make money on food?”
Michael: Yeah. Well…
Barry: It’s not going to be a Wealthfront or a Betterment or something, it’s going to be Amazon or Google or Alibaba. It’s going to be somebody where, and they’re doing this now in health care. You know, the number of firms getting involved in healthcare, given how much money there is and how they can disrupt the whole platform, they’re doing it. And to do it in insurance, you know, is an ass pain. Can you imagine, you know, how much easier it is to do an index fund and just say, “This is what we’re going to do, and we’ll make money in other ways?”
Michael: So where do you put your business? Like, are you guys an AUM model right now?
Barry: Well, we are, but that’s how we get paid. Where we add our value is through the personalization, the sophistication, the ideas, the strategies, those kinds of things. And that’s where, having more eyeballs in each and every client, having fewer clients per advisor. We have a CPA on staff. We have an attorney on staff. You know, diving into more and more for the average let’s say, $3 million to $10 million family, yeah, they’ll stick around in spite of mutual funds being free. You know, the guidance. Until AI really comes out and works, the guidance side will still be worthwhile.
Michael: So your frame would be like, “We’re going to stick with AUM, not because investment management fees are going to hold up per se but because AUM is just how you get paid your value as other stuff. And as long as your value ties to the fee, you’re trucking along.”
Barry: Yeah. For our bigger clients, we’ll charge a flat fee. And that’s always refreshing. You know, because whether we manage $20 million, $30 million, $40 million, $50 million for that family, it’s the same fee. And when you do that, there’s no longer a land grab for assets. It’s like, “Wait a second, I’m paying the same fee whether I keep my Morgan Stanley broker or not. Yeah, I’ll move it.”
Michael: You know, when you get up to the tens of millions of dollar clients at least.
Barry: Yeah. But I think that’ll come down and the flat fees will come down and such. I think it will. Currently, it applies probably above $30 million. But I think that’ll come down and there’ll be more flat fees at lower levels. You know, we tell clients when we sign them on, “The first two years, it’s so much easier for us to prove our worth because we’re really diving in and fixing a lot of things and coming up with some innovative strategy. It’s year three that you’ve got to worry. And, you know, hopefully, by then we’re showing you on an annual basis where we’re adding the value.”
Michael: So where do you go for your inspiration?
Barry: I’ve got two groups that I belong to. One is called CADRE, which is a local group of entrepreneurs.
Michael: Oh, Derek, Derek Coburn. Okay.
Barry: Yep. And I’ve got to tell you, I absolutely love the people in it, love the group. No one ever hands out a business card. Everyone is just looking to help each other and those things. No one believes that they’re only the best thing in the whole wide world. It’s we’re just trying to get better, personally and professionally. And I love that.
Michael: But in essence, like, it’s a networking group? Like, is that a fair characterization?
Barry: It’s a group of entrepreneurs who help each other think about how to be better. Is it networking? Kind of, in that you meet new people. But, you know, it’s really around thought leaders. They’ve had everybody from, you know, Dan Pink to Gary Vaynerchuk speak. I mean, really exposing you to different thinkers. And I love that. Absolutely. I thrive on it.
Another group that I joined recently is Mastermind Talks. And I think I was fortunate enough to be included. Something like 4,000 people apply and they every year only have 150 people.
Michael: Oh, interesting. It’s called Mastermind Talks?
Barry: Yeah. Run by a guy by the name of Jayson Gaignard out of Toronto. And I would put his podcast, not necessarily Mastermind Talks but his podcast in one of the resources. It’s called Community Made, really fantastic.
Michael: The Community Made podcast. Okay, we’ll make sure we include it in the show notes. So for folks who are still listening, this is episode 69, so if you go to kitces.com/69, we’ll have a link out to the Community Made podcast by Jayson.
Barry: Yeah. And at the past conference, the CEO of Levi’s spoke. Naveen Jain, who’s the guy putting the money behind…you know, putting the next man on the moon probably in the next year and a half. He has a gut project that he’s working on to figure out the bacteria in your gut. You know, the sheer number of just innovative thinkers. Oh, he had…who’s the guy who…Oh, I’m flaking on it. He was Alice Cooper’s manager. They did a Netflix special on him and he spoke about just relationships. He’s the one who started the whole celebrity chef movement. He represented Emeril and Wolfgang Puck and all of them. Oh, I’m blanking on his name. But these are the people who spoke. And they talk about just their lives and how they’ve innovated and thought differently. These are the kinds of conferences and places I go. And by the way, you can get a lot of this on ted.com.
Michael: Yeah. I still listen to TED Talks. There’s really good stuff there.
So where does the firm go for you guys from here? Like, are you just powering forward? Like, you crossed $1 billion, you want to go $2 billion and $4 billion and $8 billion and just keep doubling every couple of years with growth? What’s the vision for the long term for you?
Barry: We really have never set assets under management goals. It’s never happened. It’s never been part of what I’ve done ever. We want to grow by, you know, 15, 20 clients a year, the right kind of clients. We want to provide opportunities for people to join us and hopefully learn from us. If people graduate from us and go elsewhere, we hope that, you know, eventually we have a network of ex-Glassman Wealth folks who, you know, are out in the community doing great things. Will it lead to $2 billion, $3 billion? I think so. But, you know, as long as we are…and it’s not a line. We really mean it. No, as long as we’re really diving in and serving each and every client, then it’ll happen. It all happens. I think when you try, it actually will slow down. When you set the goal of assets under management or something, for some reason I just feel like people can smell that.
Michael: You mean, you know, prospects will sniff you out or, you know, feel the push?
Barry: Maybe. Maybe. I just think that, you know, we’re trying to do it to really enrich the lives of the clients we have. And from there, that’s going to lead to more clients, whether that happens really fast or at a slower pace or that, I just believe that it’ll happen. And the same was true when I was cold-calling. I knew at some point I’d be full with 100 clients, the question is did I need it to happen in 2 years? Was it okay if it happened in five years? What’s different in my life to try and make it in two versus five? And is that the kind of firm that I wanted to build? So I just think that setting goals around culture, setting goals around providing opportunity, setting goals about communication, that all leads to new clients. So I think it will.
You know, the funny thing is we passed $1 billion almost a year ago, I think it was last…exactly. Yeah, last May. We didn’t send out press releases. We didn’t even tell our clients. We didn’t brag. Oh, by the way, we hit $1 billion twice. We hit it, $1 billion, the market went down the next day so we were under, and then it went up again. So we hit it twice. But it was just, you know, I just don’t know how clients would take it. Some would be proud of us and excited for us, others would say, “Wow, you’re growing so big too fast.” So we really don’t focus on the assets under management in, you know, almost anything that we do. Circling back, maybe that’s why, you know, the Barron’s thing irks me so much. What a good way to circle back to the beginning of the conversation.
Michael: Yeah. Well, it reminds me of that whole discussion about, you know, like, do you focus on goals or do you focus on systems, right? And you guys seem to be focused much more around the systems. You know, “If we’re good at culture and we’re good at communication and we’re good at clients, the growth comes,” as opposed to setting growth goals?
Barry: Yeah. You’re exactly right.
How Barry Defines Success [1:35:56]
Michael: So as we wrap up here, you know, this is a podcast around success, and one of the themes is always that we view success differently. It means different things to different people. And so, you know, you’ve certainly had what I think anyone objectively would call a very successful business with a really strong growth trajectory with very affluent clients, but, like, for you at a personal level, I’m just curious, how do you define success for yourself?
Barry: I think it’s being able to do what I love doing, and for me to thrive in my role. A lot of times we hire people who are great for each position, but we forget about us. And it’s taken me a long time to figure out, “What is it that I want to do in this role?” Yeah, I love client meetings and I love coming up with ideas. I love talking to Mike Kitces and that. But what is it? And my end is going to be more around the culture, communication, education, those kinds of things. And then providing opportunity to those who are here as well as, you know, finding the next advisors to join us. And if I can spend more of my time on client communication, leveraging my time, 1 message sending to 200 families, then that’s really my best time. And if I can do that, I’m just going to love every single day. That’s really how I’m defining my success.
And because I’ve verbalized that to clients as well as my team, I was able to go to Australia for the past two weeks and I didn’t need to call or email a single client. And that’s special to me. Not because I was able to get away and ignore clients, clients were well taken care of in spite of me not being here. That’s success all around.
How do you define success for you? You’ve got eight different avenues going on, and what does success look like? You know, we talked about this. We touched on this at…where were we? At the place at Tysons II when we got together for lunch, but what’s your goal for success?
Michael: You know, for me, the drivers around success are really I’m finding are twofold. Number one is there’s certainly a piece for me that’s about impact and the reach of impact. I think at the end of the day, like, my evolution away from working within an advisory firm and out to the broader advisor community was, you know, with much love to the work I’m very proud of what we do for 1,000-plus clients at Pinnacle, like, it wasn’t scratching the itch for me to only be focused internally for our 1,000 clients. I wanted to be able to reach more. And, you know, for most of the businesses that I’m involved with now, they’re businesses for advisors. Because as I view it, when the average advisor has almost 100 clients that they reach, it means literally everything I do for advisors has a 100X impact. And so, you know, I view all of what we do as having a 100X multiplier out to the broader marketplace. And that’s…
Barry: Was that a goal of yours or did you realize that over time?
Michael: No, I realized that over time. I mean, I think I just had an urge of, “I want to feel like the work I’m doing has more impact for more people.” And that’s probably what dragged me in the direction of doing more for advisors. I was always kind of cognizant of, I guess sort of the, like, you know, you buy someone a fish or teach them to fish, right? Like, I can help a client or I can help an advisor who helps lots of clients.
Barry: That’s awesome.
Michael: So that piece was always out there for me, but, like, I don’t think I articulated it that clearly early on.
Barry: Well, I’ve got to tell you, you know, I’ll speak for a lot of the people listening, not the people listening in the second hour because they’re crazy, but for a lot of advisors, we’re grateful that you do thrive in this role. And it doesn’t matter if you’re brand-new in this profession or you’ve been in it for 25 years, we pay attention to the stuff that you burden yourself with. And we appreciate it.
Michael: Oh, my pleasure. That’s the goal for it. It’s being able to reach more, you know, and for me, just having the…similar to you, like, having the personal flexibility to do the things that interest me. You know, as crazy as my days usually are for all the stuff that I do, like, I am actually excited to get up in the morning and read the emails.
Barry: I’m surprised you’re waking up. I figure you’re up all night.
Michael: No, no. Actually, I still have to get my normal eight hours of sleep. I don’t have much other social life right now. But part of it is because, like, I so enjoy what I do. Like, I look forward to getting up in the morning and reading emails of people that send in questions overnight through the blog and reading through comments and trying to respond to them. Unfortunately now there’s way too many of them that come in that I can’t respond to all of them the way that I did for a long time, but, like, I still set time every day to just reply to some of the questions and inquiries that come in because just it feels good to know that people are getting reached.
Barry: That’s great.
Barry: That’s great. Well, this is fun.
Michael: Thank you. Thank you for joining us on the “Financial Advisor Success” podcast here and, you know, turning the tables at the end.
Barry: My pleasure. Hope to see you soon.