Welcome back to the 164th episode of Financial Advisor Success Podcast!
My guest on today’s podcast is Julia Carlson. Julia is the founder and CEO of Financial Freedom Wealth Management Group, a hybrid RIA based in Newport, Oregon, that oversees nearly $300 million of assets under management for almost 1,000 client households.
What’s unique about Julia, though, is the way that an unfortunate car accident that her daughter was in led Julia to transition very quickly from being the lead advisor that ran her own firm to expanding her staff and becoming the business owner of the advisory firm instead, if only out of sheer necessity of finding the time she needed to support her daughter’s recovery, but in a way that allowed the firm to more than quadruple in the eight years since.
In this episode, we talk in-depth about Julia’s journey through her advisory career. From her challenges early on gaining professional credibility as a young female advisor where a prospect once told her she was too pretty to be a financial advisor to the way she got her foot in the door talking to small local business owners about their retirement plans and building wealth outside of their businesses. How reading Dave Ramsey’s “Total Money Makeover” launched Julia’s path towards a more holistic planning-centric approach to clients and the way that she built her client base in the early years with Ramsey’s Endorsed Local Provider referral program, now known as SmartVestor Pro.
We also talk about the transformation that Julia’s business had to go through, almost literally overnight, when she got the call from her own client appreciation event that her daughter had been struck by a drunk driver and was being airlifted to the hospital in critical condition. How the pain of being forced to try to run her business from the ICU while being with her daughter during recovery led Julia to hire a president to take over running the firm on a day-to-day basis, the way that shift ended out allowing Julia’s firm to double in size from $60 million to $120 million just 2 years later, as her time and focus were freed up for growth, and how the firm’s adoption of Gino Wickman’s Entrepreneurial Operating System has allowed the business to run even more efficiently as it more than doubled again over the past several years.
And be certain to listen to the end, where Julia talks about the real-world challenges of trying to let go of having so much control in your business, or as Julia puts it, how to stay in charge even if you’re not in control anymore, the way that she took a hard look at everything that does and doesn’t energize her, from week-to-week, to figure out her own strengths and where she should be focusing her time, and how the hardest thing to do in the end was letting go of client relationships but how, once Julia acknowledged that it was a crucial step, the firm quickly figured out how to create an internal training program to ensure that other advisors would service clients up to Julia’s standards.
What You’ll Learn In This Podcast Episode
- Julia’s Early Years Starting Her Business [00:06:56]
- How Julia Stayed The Course To Persevere Through The Early Years And How She Decided To Go Solo [00:18:30]
- The Life-Threatening Accident That Made Julia Realize She Needed To Change Her Business Role [00:39:21]
- How Julia ‘Fired’ Herself And Brought On Someone To Help Her Run The Firm [00:48:54]
- What Julia’s Business Looks Like Today [01:06:39]
- Self-Discovery Tools That Julia Uses To Measure Her Strengths [01:13:24]
- What Surprised Julia The Most About Building Her Own Advisory Business And What She Would Have Done Differently [01:18:12]
- What Success Means To Julia [01:36:55]
Resources Featured In This Episode:
- Julia Carlson
- Julia Carlson Personal Site
- Financial Freedom Wealth Management Group
- Tony Robbins
- Unleash the Power Within
- Unleashing Power With Tony Robbins by Julia Carlson
- Dave Ramsey’s SmartVestor Pro
- Dave Ramsey’s Total Money Makeover
- Rocket Fuel by Gino Wickman
- Strategic Coach
- FP Transitions
- Entrepreneurial Operating System (EOS)
- Lisa Dion of Strategic Advisor Solutions
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Michael: Welcome, Julia Carlson, to the “Financial Advisor Success” podcast.
Julia: Thank you. It’s good to be here.
Michael: I’m really excited about this episode and the discussion that I think is a wall that a lot of advisors hit, where you go out, you get started, you get some clients going, you build a client base, maybe hire a staff member or two to support you, and then eventually you kind of hit the limit of what you can do as, as I was framing, a self-employed person – a highly leveraged, highly efficient self-employed person.
And then there’s this leap, there’s this transition that you can make, that not all advisors do make, where, as I like to put it, you move from being an advisor to being an advisory firm business owner. And what you do and where you focus and what your role is in the business as it begins to shift.
I know that is certainly a journey you have lived through, with some interesting trials and tribulations along the way. I think a lot of advisors have those kinds of challenges, trials, and tribulations along the way. It’s sort of the quintessential example of the famous E-Myth story: that we start in these businesses because we’re good at a thing. And if we’re really good at the thing, we get a lot of clients, and we do a lot of that. Then, at some point, you try to figure out how to stop being the doer of the thing and start being a business owner of a business that does that. It’s a really hard transition that not everybody actually makes.
Julia: Yes, very true. And I have to say that there’s a valley, maybe even a crevice in there that you have to work through and really decide to plant your flag and say, “This is what I want to build.”
Michael: Which I find that a lot of people don’t even get there without usually a pretty significant amount of pain along the way. I think we have this tendency, where you start with, “Yeah, I’ve got a lot of hours and not very many clients.” And you start getting clients and have slightly fewer spare hours. Then eventually, you get enough clients and it fills all your hours, so you hire some staff to help you free up a few more hours so you can squeeze a little more productivity out.
At best, I find that for almost every advisor who makes this transition, they have to hit this time wall. You have to bury yourself under this capacity wall for a period of time before eventually saying, “I just don’t think I can do this for another 10, 20, or 30 years. I’ve got to do something different.”
And the pain of, “I feel like I’m buried and drowning in my business; it’s really successful, but I’ve never been more miserable” seems to be the trigger to get someone across the line to say, “All right, it’s going to be painful to change, but it’s got to be better than how not good it is right now, even though outwardly it seems good because the numbers are good and I’ve got clients and the income is good, but I’m not happy.”
Julia: Yeah. There was a point – when I look back now – there was that point of transformation. I may not have known it in the time, but now looking back, there was that pivotal event that happened that I had to really decide, “Am I going to be a solopreneur or am I going to build something that’s going to outlast me?”
Julia’s Early Years Starting Her Business [00:06:56]
Michael: So share with us some of this journey. How did you get started in the business? What did it look like in the early years of creating the proverbial, “I planted my flag as a financial advisor, I’m going to get me some clients, I’m going to be a successful financial advisor?”
Julia: Yeah. So I live in a very small town in Newport, Oregon, so it’s as far west as you can go right in the ocean on the Central Oregon coast. And I moved here when I was 18. Met my now husband. And at that point decided okay, at 18, I had no idea what I wanted to do in life. I knew that I was interested in personal finance. I remember sitting on my grandpa’s lap looking at the TV, watching the stock ticker symbols going across the screen thinking, “What’s that about?”
Michael: Okay. “This looks neat and interesting. Okay.”
Julia: Yeah. I got my first job at McDonald’s, and my dad said, “Okay, Julia, we’re going to open up a Roth IRA.” And that was my introduction to mutual funds. And so thankfully, I was raised in a healthy money environment. And my parents kind of stewarded me and helped me get that going.
So when I came to the Oregon coast, I went to work for a local bank. They had an investment department within the bank, and I kind of raised my hand and said, “I would like to work in this department.” Once I did that, I think I was 19, and I got licensed when I was 20.
I was a registered assistant there until I was 23 when I realized…I put my hand up again, and I said, “I am ready to be a financial advisor.” And they said, “Great. As soon as the advisor retires, you can have that position.” So if I would have…
Michael: Excellent. That’s a long-term…
Julia: So I hit the glass ceiling.
Michael: I’m presuming this wasn’t an advisor who happened to be in their late 60s and retiring imminently?
Julia: No. No. So I decided at that point I was going to take the jump. I was recruited into more of an insurance general agency model that also had a broker-dealer. I was driving three hours to my branch office one day a week but building a true business on the coast and pounding the pavement and introducing myself and everything you had to do back in the day to build the business.
Michael: Yeah. So share a little more of what that looked like. You’re a 23-year-old female hanging your shingle as a financial advisor with an insurance company. What did that look like? What were you doing? What were you trying to take out to the marketplace?
Julia: Well, I was fiercely independent, so I was out to prove that I could do it. A lot of people probably thought I was too young. I had people say I was too pretty. I had my own self-doubt and all of that going on that I had to work on my own personal development.
Michael: Well, there are some interesting pieces there. Too young is one thing. That comes from across the board. We do have an industry with a very high attrition rate, particularly for young folks, because we tell them to go get their own clients. They don’t know anyone. They’ve got to do that cold, and not a lot of people survive.
Too pretty is a little bit of a different angle, though.
Julia: Well, I vividly remember, I was trying to build these relationships with attorneys, and one of the attorneys, I came in one day to give my latest newsletter and some business cards at their networking event, and he looked at me, and he said, “Wow, well, don’t you look pretty, you look like a cheerleader.” My jaw dropped. How do you even respond to that?
So I was out to prove something, for sure, in those early days, which ultimately created more of a rugged individualist, where when you start feeling or start building a business that we get to later in my story, that was a big transition that I had to get over my own ego at that point because I had done a pretty good job building it up because I needed that confidence to go make it happen.
Michael: Right. I think we’ll end out talking about that more later, but that weird challenge, the self-confidence we have to have, get, build, or find in ourselves – and even just in the positive sense, the ego that goes with getting that positive self-confidence in yourself to build for those challenging early years – for a lot of people, that becomes the blocking point later, because there’s a period where you need to bring your ego to have the self-confidence to do it. And eventually, in business, there’s a point where you have to park your ego, or you’re going to blow up your business.
Julia: Exactly. And that happened a couple of years later.
Michael: All right, we’ll get to that a little bit further down the line, but help me understand more of just what you were doing to build out of the gate. There are so many people that start in their 20s, men or women, that struggle tremendously and aren’t able to get enough clients to survive and keep going. What were you doing early on that you are still here with us?
Julia: Yeah. So number one, I learned through my experience. I always wanted to increase my knowledge, read books, and learn so I could go out there and help and differentiate myself as the expert.
One of my strategies early on was to target business owners; it still is today, but I help them in a different way than I was able to help them back then. Back then, it was going in and talking to them about SEPs and SIMPLEs, and in rural Oregon, we have a lot of business owners. So that’s kind of the avenue where I started.
I also solicited friends and family. We are in a small community, and so the work that I was doing, the people were happy, and the referral network grew. It was a lot. I probably blocked out a lot of those early days, but it was a lot of work.
Michael: So the friends and family side, I get. How were you trying to get to business owners even just to talk to them about SEPs and SIMPLEs? Were you…
Julia: I would walk into their businesses.
Michael: So just…
Julia: Pounding the pavement.
Michael: Door-to-door, pounding the pavement, like go down to Main Street. And how do you get in? How do you reach them?
Julia: Well, a smile goes a long way.
Michael: You’d just go up to the counter and ask to talk to the manager? And the manager would come out, and you would just ask, “Can I talk to you about SEPs and SIMPLEs?”
Julia: Pretty much. Well, I do remember having this line, “You didn’t go into business to go broke. You went into business to build a future for yourself. And I think it makes sense for us to sit down and talk about how you can build wealth outside of your company.”
Michael: Okay. So that was kind of the angle, to pique their interest. Like, “You’re building all this wealth in your company. At some point, you’ve got to reap what you sow, so how are you going to start building wealth outside your company?”
Julia: Exactly. Today, it’s turned into exit planning, which takes it deeper. But at the point then, it was like, “No, let’s just get you to start saving for your retirement, and looking at this as a tax deduction for your business.” Trying to get them to see the value of starting to pay themselves first.
Michael: And it’s worth knowing, this is in the context where 20 odd years ago, SEPs and SIMPLEs were very popular, and 401(k) plans were still relatively expensive for a lot of small businesses to offer. There wasn’t a solo 401(k) plan yet. A lot of people just reverted back to IRAs. So talking SEP and SIMPLE IRAs – that was a new thing at the time. That was a leading retirement-planning-for-business-owners conversation at the time.
Julia: Yes, yes. And then there were a lot of Roth IRAs. The company I was with was an insurance company, so I did life insurance. It was a lot of small accounts. That’s still who we serve today is the mass affluent.
Michael: Although I would imagine then it wasn’t even just mass affluent households that maybe had $100,000 or few hundred thousand dollars, I’m going to imagine this was all the way down to like, “Oh, you need a…” what would have been a $2,000 IRA? “I will help you open that $2,000 IRA.”
Julia: Yeah. I was eager to help people. That’s still the heart of what I love about our business – I want to create value, and I want to help people. I’ve never wanted to turn anyone away. In fact, over the years, we have maintained a zero account minimum, and we can talk about that more when we get to today.
I remember a client who I helped start saving $50 a month into a mutual fund, and then 5 years later, it was one of my biggest accounts. They had received an inheritance. It was probably not quite $1 million, but I think $600,000 or $700,000. And it was like planting all these seeds and then starting to see fruits.
Michael: And so getting clients early on was like just a volume activity. Anybody I can get, anything that comes in the door, if there’s some revenue, we’re going to make this work.
Julia: Yeah. I did seminars. I was part of the Chamber. I was out in the community. It was just a lot of sheer determination.
Michael: But I’m struck that just you’ve found ways to turn it just into business at the end of the day. I know a lot of advisors who come in, full of heart, and eager to help people. But being eager to help people doesn’t mean people volunteer to be helped by you. Unfortunately, it’s still a crowded space. So what was driving it for you?
How Julia Stayed The Course To Persevere Through The Early Years And How She Decided To Go Solo [00:18:30]
Julia: I have listened to Tony Robbins since I was probably 19 years old. That sales mindset of how to influence people – how do you build rapport? How do you build trust? How do you define the needs and then create solutions? I was a student of personal development and using those skills to influence people.
Really, what I truly believe inside, is that I want to inspire people to abundance and to building the life that they want to build. And now, for business owners, how can I help them on a journey to get freedom back from building their business that has taken so much work?
Michael: Are there any particular Tony Robbins books, readings, or something else you would recommend for someone who’s listening and wants to try this today? Because I would imagine a lot of what Tony does and has written is pretty timeless.
Julia: Oh, yeah. “Unleash the Power Within.” Whether you go to his conference or you read, go to YouTube and punch it in, there’s so much work out there. But “Unleash the Power Within” is about really understanding human needs and what drives human behavior and taking that and creating an action plan for what you want and going after it. I wrote a piece about it for “InvestmentNews”. Maybe I can give you that link and you could…
Michael: Yeah, absolutely. We’ll include it in. This is episode 164; if you go to kitces.com/164, we’ll have a link out to Julia’s “InvestmentNews” article around this.
So you’ve been absorbing Tony Robbins, getting some ideas of how to connect people with people and build rapport, turning that into a business of people saying yes, and starting to get some traction. At least there are enough dollars and revenue coming in that you’re still with us here in the business. So the math worked enough. What came next?
Julia: So I think what came next was in 2008 when I became an Endorsed Local Provider. At the time it was called that, for Dave Ramsey.
Michael: Okay. That’s now their SmartVestor program?
Julia: And what happened there was I was working with an insurance company that really brainwashed us to look at insurance as…it revolved around permanent insurance. Insurance as an investment, just like this one sale, everyone needs this.
Dave Ramsey kind of opened my eyes to more financial planning and looking at a different way to help people. When I read “Total Money Makeover”, it just made so much sense to me. And at that point, I went to the website, and I put our information in. And then it was probably not until 2007 and 2008; a year later is when we got the territory. Yeah. And I remember it was $600 a month that I had to pay to be part of the program. I remember just thinking, “Oh my goodness, this is a huge commitment.”
Michael: Yeah, that’s a big number, particularly if you’re still early on in the business.
Julia: Yeah. So at that point, I decided to go for it. What I realized was that I was not congruent with the company that I was still affiliated with at the time.
Then 2008 happened. I had a baby. So there were all of these events that were just pointing me in the direction of how I needed to make a different shift in my career, and I needed to become totally independent at that point.
Michael: It’s an interesting transition for advisors when you kind of have this realization of, “I’m not sure I’m actually feeling so good about the company that I’m with, the platform that I’m with”, I guess realizing or deciding that you may have to make that change, which is messy even in the best of circumstances and a real pain sometimes.
So was there a particular trigger moment or event?
Julia: Well, the whole meltdown. I remember in the Fall of 2008 I was five months pregnant. The market was going down every day. I couldn’t talk people into hanging on anymore, right? My energy was just totally zapped. And I didn’t feel like I was being supported by my branch office that oh, by the way, was taking probably 40% of the split. So I said, “I’m three hours away. I’m on my own out here.”
I was running my business like a business or like a solopreneur at that point. But at that point, I just needed to get a place where I was independent. It was a money decision at that point too, I think, because I was feeling like I wasn’t getting the value for what I was giving up.
Michael: Right. At the end of the day, the platforms do take sometimes a non-trivial portion of revenue, but the reality is if you’re running a business, you have to spend a portion of your revenue on overhead and office and rent and support staff and compliance and technology and all this stuff.
So it’s not necessarily a bad thing that platforms take a portion of the revenue because you’re going to have to spend it anyways. But if what they’re giving you is not worth what you could just spend the money on yourself and do it cheaper on your own, at some point, the math doesn’t work just because you say, “I can replace what my platform does for a lower cost than what my platform does, or find another platform that provides similarly but takes less off my grid.”
Julia: Yeah. And at that point, I was paying for my rent. I was paying for…I think I may have had one part-time assistant. I was paying for all of that on top of giving them, I think it was 30%, 40%. And then the revenue – at that point, I was commission-based, so it was getting harder with the economy to make those sales.
Michael: Right. When the economy is down, and things are going haywire, it’s an interesting thing. I find for a lot of people in the business today, we tend to say, “Oh, people get really complacent in a bull market when the market goes up for 10 years; we need a bear market and then people will want to move and make transitions.”
But the truth, having been through two of these cycles myself now, is that people don’t break loose when the bear market comes, they freak out, and they hunker down. And they stop opening envelopes. Now, a year or two after markets go crazy, once the dust settles and they start opening envelopes again and realize they’re not happy with what’s happened, there is absolutely a business opportunity that comes in and people start going in motion.
But in the middle of market declines, everybody just hunkers down, which means if you’re on an AUM model, you’ve got to keep them on board so that they don’t panic and bail out. And if you’re on a commission-based model, the sales just stop. The business stops.
Julia: Yeah. And at that point, I remember, I think I got my advisory license. I was starting to dabble in that. But when we made this shift to independent then I really started making that the focus.
Michael: So, where did you decide to go when you made a transition?
Julia: So my son was born in May of 2009, and I think I shifted in late July, early August to LPL.
Michael: Okay. And so why LPL?
Julia: I know you’re going to laugh, but I remember looking through those industry magazines at the time, and I saw an ad for LPL. I remember seeing a limousine, and I’m like, “I am on the bus and I need to get to the limousine.”
Michael: So, marketing imagery works. Just to be clear, like, branding…
Julia: I am very visionary.
Michael: Branding and marketing work. Like, if you find your right target audience and you get the right images in front of them, it connects with people.
Julia: And at that point, I didn’t ask questions. I didn’t know that there were signing bonuses. And maybe there weren’t back then. But I think about today, I didn’t know any of those questions to ask. I think I probably had maybe $25 million that I brought over, so maybe they wouldn’t have given me anything anyways. But that’s where I started in 2009.
Julia: Own a direct mutual fund business.
Michael: Yeah. So I presume then you had some business that came with you but a bunch of clients that were on old insurance policies that weren’t movable or appropriate to move?
Julia: Right, right.
Michael: So, what did it look like when you made the transition, made the leap? What was the state of the business at that point?
Julia: I feel like I still had a staff. I still had one person that was helping me. I think at the end of the first year with LPL, I maybe did $120,000 or $130,000 of GDC, we called it at that point, and $30 million in assets maybe at the end of that first year.
We just started to think about maybe a couple million in advisory. But at that point, I knew that that was the direction I wanted to go because I saw what happened in 2008 when people needed money out of annuities that said that they would never need the money out of the annuities, right? So I saw the damage that was done in 2008 because people didn’t anticipate the worst-case scenario.
So when you plan, plan for the best, and expect the worst. For me, it was just that shift of needing to help people in more thoughtful financial planning.
Michael: Interesting. So a lot of people focus on annuities with the guarantees specifically for scenarios like 2008. Your portfolio may be scary, but this annuity contract has some guarantees associated with it. So was that…
Julia: But at that point, they didn’t have those.
Michael: Were those not the kinds you were doing, or that didn’t hold up for you in practice?
Julia: I feel like a lot of those income riders did not happen until after 2008. The ones that we…no, I don’t…it could have had a death benefit guarantee but not when they needed the money.
Michael: Okay. So you had clients that were in just straight-up variable annuities riding the volatility down and freaking out more or less the same as anyone else except now you’re also in a less liquid contract with some surrender charges and some other things that are not as positive at that point.
Michael: So the driver for you – you wanted to go advisory accounts, not necessarily around the business model piece of it but more of I just want to be able to manage client assets more hands-on and directly than what I can do with what’s off of an annuity product line-up?
Julia: Well, I think probably both. In the commission world, you’re always on to the next client, right? I saw that in the bank, and what I didn’t want was 1,000 clients and not servicing them and giving them that relationship-based service.
So, for me, it was that desire of, “I want to take care of you. This is not a transaction. This is a relationship that we’re going to build for a lifetime.” That fit with my philosophy as well. We were probably 50/50 for probably the next 5 years; it was hard because I wanted to grow the business. I wanted to hire. I wanted to do all these things. And you can’t do that on a pure advisory business in the beginning.
Michael: Yeah, it’s challenging, right? In the world, I guess even then when probably a lot of variable annuities were still largely paying 5% to 7%, even a lot of A share mutual funds were 4% to 5%. When your choice is like, a client comes in with $100,000, option A is a commissionable product, and you will have $5,000 in your bank account in a few weeks, or option B is we put them in an advisory account and 3 months from now, you’ll get 250 bucks, which is your first quarterly billing on $100,000 account.
The math of that across a firm, while you’re still in the early years in building, can be incredibly profitable and viable in the long run as assets under management add up, but relative to what commissions paid in the past, it puts a squeeze on people when they’re trying to build an advisory business in advisory accounts when the revenue is that levelized.
So you had this five-year plan of slowly and steadily transitioning from more commission-based accounts into advisory accounts?
Julia: Yeah, I knew that that was the way that I wanted to go. And I wanted to build that. Thankfully, I learned personal finance early on, so I was diligent in my own personal financial life of doing all the things that I was preaching. That allowed me to take a modest salary and re-invest all of the profit back in the business.
I wasn’t scared of investing. I was scared maybe, but I did it. I put the money back into investing in my personal development. And hiring people to me always felt like an investment as opposed to a cost. Of course, it’s scary when you’re hiring and starting to take on other people that you’re responsible for.
Michael: Yeah. There is a saying out there, I guess…I heard it first from Mark Tibergien. I don’t know if he originated it or got it from somewhere else, but he says something to the effect of there are two types of business owners, the ones who view employees as a cost and the ones who view employees as an investment.
If you just kind of reflect on that, yeah, that’s a big difference in what you do with your team and how you try to develop them and grow the business over time.
Julia: Yeah. And sitting here today, it’s because of the team is why I’m here.
Michael: So, how did this transition go in practice? Was this a like, we’re going to hold on to some commission business but new clients are going to go into advisory? We’re going to try to rotate clients into advisory over time as old things come up that they don’t need anymore and we’ll just shift them gradually? How did you make this transition? Because it’s hard.
Julia: I would like to say that it was an intentional plan, but it wasn’t that way. It was more about really going back to the client and what is a good fit here. Like if they were in retirement and we needed to create that guaranteed income, then okay, maybe something would fit there, and then still doing advisory for a piece of their business as well.
So it wasn’t a calculated mix we were doing, it was more of feeling what was right. That’s just kind of how it evolved. But although even now, today, I would probably say it’s probably over 90% advisory. So that’s even evolved in my thinking and planning.
Michael: And so as you were starting to do the, as you said, building and the hiring when you made the transition, you said there was one person that came with you, and that you did your $120,000 of GDC in that half-year as you were getting going at $30 million over.
What came next on that growth trajectory for you?
Julia: Yeah. So I hired two full-time staff. I think that was in 2010 or 2011. And then in 2012, I brought on someone that would actually sit in on my appointments…that was one of the most important hires looking back. So to have someone at my side all the time, even in client appointments, because it was then helping to start thinking about that duplication like, “Oh, okay, now I don’t have to explain what needs to be done. And now I don’t have to do the notes for CRM. Now I don’t have to do this thing.” And it was just saving me so much time, which really increased my productivity and really started leveling me up.
So in 2012, I think I had three staff at that time. Three years into building the business, I have the numbers here. My revenue in 2012 was $420,000. So still growing quite rapidly.
And at that point, I’m like, “This is working, I’m successful.” I was working a lot, but I didn’t see that at the time. At the time I thought, “I’ve arrived. This is working.” And I actually hosted one of my first client appreciation events. I rented out a boat on a river and I was going to take 40 of my top clients out for this cruise. And I just remember it like it was yesterday, just looking out and being so grateful for the community that I was creating and helping. I was creating these relationships.
When the night came to a close, my assistant and I were on the boat. At that point, you didn’t carry your cell phone with you everywhere. So I grabbed my cell phone and looked down and realized I had missed 18 text messages, 11 calls, and…
Michael: Oh, that’s not good.
Julia: That’s not good. It’s never good when you see that.
Michael: No. No, that’s way too many.
The Life-Threatening Accident That Made Julia Realize She Needed To Change Her Business Role [00:39:21]
Julia: So I realized that my daughter was traveling in a car and hit head-on by a drunk driver, and at that moment, being life-flighted to a Portland hospital. My assistant drove me right to the hospital. I got there right when the helicopter was landing. We were in ICU for a week. She had broken ribs, punctured lungs, lacerations to her liver and spleen, just all these internal injuries that she was being monitored. And happy to report, she’s healthy today.
But what I realized was, sleeping in ICU next to her the day after her accident, I was calling my office, asking them to bring me my computer, returning phone calls, doing trades, juggling all of the things that I thought I had to do because I had made myself so important in my business.
At that point, I was there physically for my daughter, but I wasn’t there in all the ways that I needed to be there. And that summer, I needed to stay home and help her recover. And that’s all I wanted to do was to be there. But I had to, at that point, juggle all of the stuff for my business. And that was the point, looking back, that I had to make a decision to say, “I need to make myself less relevant. I need to transition this so I can build a true business and get out of my own way.”
Michael: And that all came just literally off your first client appreciation event?
Julia: So there was guilt, where was I? There were a lot of emotions that went into that. Like, “What am I doing?” And a lot of ego stuff came up then. It was a hard, low time when I thought I had reached this successful moment, then it all came crashing down because I realized how important I was to every aspect of my business.
Michael: Which ironically up until that point was like, that was a feature. That was a part like, “My business is doing well. I’m in the central piece of my business.” It makes you feel good and valued in your business when you have such a positive impact on your business. All the things that were good were suddenly bad.
Julia: Yep. And a lot of self-examination and all that stuff.
Michael: What happened next? What happened as you came away from that?
Julia: Yeah. So at the time you just kind of go through it, right? You only do what you can do in the moment. What I realized was that my team really stepped up. They were like, “Julia, go be with your daughter. We got this.”
But I didn’t have anyone licensed on my team at that point. So I did have to show up. I did have to do these things. I was constantly reaching out to…he is married to my sister-in-law. So kind of a brother-in-law but not through marriage.
Michael: Okay. Brother-in-law-in-law?
Julia: Yeah. He had this amazing 30 years of experience in major tech companies. At that point, I think he was working for Dell in Chicago. I remember in 2008, early on I was like, “Come work with me. We can do this.” He just had great… a different perspective from business.
So I would talk to him, and he would help me. He’s kind of a mentor to me. At that point, he could see that the business was going amazing but that I needed help. At that point, their daughters had all graduated, and so I talked him into moving out, back out to Oregon. He started working with me and got licensed. That was at the end of 2012, beginning of 2013.
Up to that point, everyone looked like me on my team, all women. I think I was attracting people like me. I just didn’t have perspective.
Michael: Our businesses often become reflections of ourselves. So in the early days, we tend to work with clients like us, and we tend to attract team members like us, whatever ‘us’ is. I think for a lot of us early on, particularly in the hiring end, it’s sort of a deliberate strategy. Like, I need help with client servicing, I want to hire someone that’s like me but likes doing the client servicing stuff.
So we hire, and you get a mini-me for client servicing. Then you may get mini-me that has an investment tilt to help with investments. And a mini-me to be my associate advisor so clients will still feel like it’s similar to me because I’m literally going to hire someone who would treat them just the way that I treat them.
I think we do it deliberately early on because it just feels like the natural extension of building the business. At least one small step beyond you or leveraging yourself is to just surround yourself with other people who would be like you and do it the way you would do it, but just not you because you ran out of time, so you hired mini-mes.
Julia: So this person was not a mini-me. This person had a lot of experience in corporate America and had management experience. I was grassroots, building my business, an entrepreneur, and visionary, where he brought a whole different perspective to it. And that was really tough.
That’s where my ego came in. I just had to learn to listen generously. I had to learn how not to be reactive. He helped me with a lot of that. He was my greatest teacher, but also my struggle because he was able to speak straight to me and be direct. I always knew it was coming from a place of love. Still today, that’s what we have to come back to.
But that also sharpened me. It allowed me to really expand and grow and become more of who I wanted to be, which was not a manager and not hiring people and all of these things that were struggles for me. Actually, on the other side of it now, there is so much clarity. Going through that was really hard. But on the other side, it’s been really great. Are you familiar with Rocket Fuel, the whole visionary/integrator concept?
Michael: Yes, very much so. I’m a huge fan of Rocket Fuel and that whole framework.
Julia: Yes. So we are too. And so I am the visionary and he is the integrator. That’s why I can say that I am in control but not in charge, or I am…I said that backward.
Michael: All right, wait, wait, wait. So say that again. How does it go?
Julia: I am in charge but not in control.
Michael: I’m in charge but not in control. Yeah. I feel like that’s a good reflection of what it feels like when you really start growing a business beyond you. I’m in charge, it says so on my business card, but I don’t really feel like I’m in control because there’s a whole lot of other stuff happening all over the place around me, and it’s more than I can possibly keep up with and literally manage and control. So I think I’m in charge, but I don’t really feel like I’m in control anymore.
Julia: And the way that we explain it to the team is…so we have a lot of fishermen clients here on the Oregon coast and even up into Alaska. Are you familiar with “Deadliest Catch”?
Julia: Yeah. So there are some boats up there where the captain is at the back of the boat, and they can oversee everyone on deck, right? Making sure everyone’s safe, we’re on the boat, we’re orderly, things are happening. And then some of them, the captain drives from the front of the boat. And that’s like, I’m looking at where we’re going. I’m looking at the horizon. I see all of these things, but they can’t see who’s on the boat, right? Or they can’t make sure that everyone’s safe and making things happen in the way that it needs to happen to catch all the fish.
So what we like to say is that I am on the front of the boat, as the visionary, seeing where we’re going, and Chandran is on the back of the boat, making sure that everyone stays on board. And we have our systems and we have our processes and everything is going well.
How Julia ‘Fired’ Herself And Brought On Someone To Help Her Run The Firm [00:48:54]
Michael: So help me understand just a little bit more of this transition itself when Chandran came on board. So was this just, “I need someone to run this thing so I can be visionary?” Was this like, “I just need to do less because I’m drowning in my business”, or just “I just need to do less because I’ve realized I’m not happy with the balance, given what happened in my availability or limited availability for my daughter?” What were you solving?
I get the whole visionary/integrator dynamic now. For those who are listening and haven’t read it, I highly recommend “Rocket Fuel” as a book to think about different types of people. Some are visionaries and just love to be looking forward, and others are integrators who love to just weave all that together in practice. And the combination of the two is particularly explosive, which is the rocket fuel metaphor. But “Rocket Fuel” just came out a few years ago. So you weren’t reading that in 2012 and 2013, when you were making this transition. What was going through your head at the time? What were you trying to do or create or change then?
Julia: I needed help. So at that point, I needed another advisor. I needed help because, at that point, I had two different locations, two hours apart. I would be driving one or two days a week to this other location to service the clients that were building out of there because we were getting so many referrals from the Dave Ramsey program. So at that point, he moved to where that other office was located. He started taking all of those clients and developing the referrals and taking on that area, which allowed me to be in my office almost all of the time and build the business here. At that point, we just needed more advisors to see people.
Michael: So it started as just, “I need client capacity.” It sounds like he didn’t even necessarily even come in with the run-the-business hat, he just came in with, “Just handle some of these clients, I can’t keep going back and forth on these locations?”
Julia: Well, no. The intention when he came was that he was going to help build this…it was like that area of the business and help me build…just keep growing the business. Because all along, I’ve had this dream to have this big firm, but at that point, I didn’t know how it would all work out. He knew all of those dreams.
I think he came from the perspective of, “I can help build this with you,” but at the time, what needed to happen was we just needed to see more people to increase the revenue, to hire more people, to… At that point, I said, “I don’t want partners. I want to build this as an employee. Everyone’s an employee. The clients are Financial Freedom. That’s the model that I’m doing. We will compensate you in a way for this growth.”
It’s changed since then, and we’re just now actually changing it, but at that point, it was really clear that he would be financially compensated for it. But I was scared. I didn’t want to bring on partners or other owners or anything like that.
Michael: And so it was just by design, that he was going to come on and just help run some of the firm, the operations, help structure some of the client activity stuff at this other office, so you don’t have to go back and forth as much.
Julia: Yeah. And he was like one of my go-to people to help me with my frustrations and employee issues and all of that. He intimately knew the business. He would be my person to go to to talk about all of those struggles and things.
Michael: And so saying like, “Oh, do you want just actually to deal with them yourself” was an easy transition.
Michael: So how did that go in practice? Just you’ve been running and doing everything, and now you brought in this highly experienced, highly capable person that’s not you when you’re always used to making all of those decisions and being in control of all of them. Because the business was built around you until you expanded the team and it wasn’t. So what did that transition look like in practice? How do you bring someone else in at that level into the business?
Julia: Yeah. So it was an employee relationship, a salary. We had set up a bonus plan at that point, but we still have everyone today as salaried employees, and then everyone has a bonus structure. And so that is how it was then, with the caveat for him that we would kind of keep track of the growth in this area.
The idea was that at the time, we would try to put together a profit-sharing, or my vision was like a cash balance or a defined benefit or something that would help put more money in his retirement to compensate him for building this value.
He, by the way, is over 70. So it was almost like I had this reverse-type plan. When I would go to people that try to get help for succession planning, it was very…they couldn’t help me because it was the opposite.
Michael: Yeah. Like, “So I have a successor who’s running the business, but he’s in his 70s. So how are we going to manage this?” “I don’t know.”
Julia: I don’t know. We kind of came up with a plan between us that I think neither of us saw how much it would have grown to now. And so we’ve been working with FP Transitions for the last three months. And we are going to introduce G2 and change the way that we’re structured in 2020.
Michael: So what did it look like in transitioning from just a management perspective in suddenly having someone else who’s at the table who’s making decisions? What does that look like?
Julia: Well, I had to fire myself. And that was hard. I think what helped me most was, at that point, I had joined Strategic Coach, which is what led me to Gino Wickman’s work and Rocket Fuel. That really helped me start getting away from this, “It’s not all about me.”
I needed to figure out how to create this business that is, in their words, self-managing? So that helped with my mindset around it. It was also very apparent that the business was growing at such a rapid pace that we needed that help. I needed that expertise and partner to really check me. And it’s hard to get feedback that doesn’t feel good all the time, but it was also, again, I said it before, coming from a place of, yeah, I care about you, I love you. I want this to grow. And you need to think about how that is looking to the company or looking to the public.
This is a really good example of social media. I remember thinking out, “He is so right.” So we had started to do Facebook and really gained some traction on social media, but specifically Facebook. And I hired someone to do social media. But all of a sudden what happened was we were getting all of this promotion out there, but it was all about Julia Carlson. It wasn’t about Financial Freedom Wealth Management Group. And I’m thinking, “Oh, it’s so great. Look at this. Look at all these likes we’re getting. And look at all this engagement.”
And he had to sit me down and say, “Okay, but again, this is not about Julia Carlson, this is about building Financial Freedom Wealth Management Group into a trusted brand, and building that trust with other advisors. And do you see what’s happening here?” And I’m like, “Oh, yeah, I could see it.” So at the time, it didn’t feel good, because I was in charge of making those decisions, but…
Michael: While he called you out for them.
Julia: Exactly. Exactly. So when you’re in the jar, it’s hard to see the label. Someone told me that once and I was like, “Oh my gosh, that’s so funny.” It’s true.
Michael: Yeah. I like that. I like that. When you’re in the jar, it’s hard to see the label. So how did this, I don’t know, I guess like evolve or play out over the next year or two? You’re kind of buried in the business. Everything is dependent on you. Your daughter has a terrible car accident, and you say, “Oh my gosh, this has to change.”
Six months later, you brought in someone else to help manage and run the business so that you can stop being as immersed in so many hours back and forth and not going to the other office two hours up the coast and the rest, right? And I’m sure there was a bunch of vision in your head of like, “Oh, this will be great. He’ll deal with a whole bunch of stuff, and then I’ll have more time.”
Julia: Not so much.
Michael: Yeah. So how did this play out over the next year or two of trying to make this work?
Julia: Yeah. Well, I think we were both. I think we saw the momentum of what was happening. There was…from 2014 to 2015, we doubled. I think we brought in, yeah, almost $60 million in that 1 year. And it just…
Michael: And where did that come from?
Julia: Well, it came from Dave Ramsey. A lot of it came from Dave Ramsey. I started writing a column for the local paper in my community, the social media. We get organically probably five leads that come through our website a week. That’s something we track.
Michael: Are you doing stuff on your website to drive that or just like, not a lot of other advisors in the area, so if they’re googling around in the area, you come up?
Julia: Yeah. But also, we have a strong presence on Facebook still. And it’s interesting; I have…this may take us down a rabbit hole, but I actually competed in bodybuilding for a couple of years. And that was one of the years that I was very disciplined. And that discipline, I thought it would have a horrible impact on my business, but I think the opposite happened because I was so disciplined and focused that that showed up in all different aspects of my life. But I think really in business as well, or in…
Michael: Doing bodybuilding? Like weightlifting competition, that kind of bodybuilding stuff?
Julia: Yeah. So the category is figure. I actually competed at the Arnold Amateur Contest in Ohio.
Michael: Very cool. Very cool. So the discipline you’re talking about was like, I’m going out for the Arnold competition. So just like, diet, nutrition, exercise, work, trainer, just all the stuff that go into competing in the competition meant everything got super structured for you.
Julia: Exactly. I was up at 5. I was doing my workouts. I was meeting with my trainer at lunchtime. I was eating clean and no processed food. I was just so disciplined in all those aspects. And what I thought would take away from my business actually really helped me get super focused and like, “Okay, when I’m here, I’m going to be here. And when I’m with my kids, I’ll be with my kids. And when I’m at the gym, I’m going to be at the gym.”
When you’re leading, when you have that hyper-focused activity, yeah, it can be a little obsessive, but it also, I think, brings this intensity that really showed up.
Michael: Well, there is a famous saying, if want something done, give it to a busy person. Folks who get really busy but focused about it often get really good at getting things done with the exact time window that they’ve got in order to do it and focusing you.
Michael: So how did the competition go?
Julia: It went good. Yeah. I think I got maybe sixth place. Yeah, it was neat.
Michael: Very cool. And what possessed you to go down this road? Don’t see that a lot in the financial-advisor world in general.
Julia: No. I ended up competing for about five years. I remember thinking… I was always an athlete in high school. I wanted to do something later. And I actually had three children. My son was my last one. And I thought, “I need to get my body back. I need to get in shape, and I’m going to set a big goal.” And that was the goal I set.
Michael: You finished having three children, and your goal to set was competitive bodybuilding.
Julia: That is good insight into my character.
Michael: So you were all in for good challenges. Okay.
Julia: Oh, yeah.
Michael: So, the business now is beginning to grow rapidly. The Dave Ramsey program is ramping up. Your focus that potentially was going to take away from the business ends out actually helping to focus you on the business.
So how is the dynamic with Chandran through this as you’re now a year or two in, and suddenly it’s growing a lot faster? I would imagine that means the roles are just kind of shifting and amplifying even further.
Julia: Yeah. We hired another advisor that started, which helped. But all of the advisors that we have, we’ve groomed them. So they haven’t come here with a book or have had that necessarily advisor experience. We have a career track that kind of grooms them up through that. And we really put the structure in place. It’s evolved quite a bit, but with the last couple years, we brought in a coach to actually help us with our accountability chart and really just have that clarity of setting goals, creating…if you’re familiar with all this, with the scorecard, right. We have 90-day goals, a scorecard.
Michael: So this is like full-on Entrepreneurial Operating System, EOS?
Michael: Okay. And who did you hire as a coach for helping to get all this focus for the business?
Julia: Yeah. So that is Lisa Dion of Strategic Advisor Solutions.
Michael: Okay. Lisa Dion of Strategic Advisor Solutions. So she is specifically an EOS coach in the whole Gino Wickman Traction system?
Julia: Yeah. Well, she’s evolved too. In the beginning, yes, but she’s really shifted away from being a technical EOS implementer. And she only works with RIAs and financial advisors that want to grow and has really tailored it to our industry. So it’s a lot that is inspired by that, I’ll say, but there’s some other stuff that is different.
So she has made it her own. And to have someone come into our offices and help facilitate those conversations, that was kind of a game-changer for developing my executive team that we have now and just was instrumental in getting us to where we are at today.
What Julia’s Business Looks Like Today [01:06:39]
Michael: So, what does that look like now? Where is the business today?
Julia: Yeah. So we have a team of 13. We have five advisors, including myself, although I am kind of shifting away from one-on-one client relationships. My goal is to work more with business owner clients. Jason Harris is our vice president, Chandran is the president, and I am the CEO. The three of us are the executive team. We are the ones that make the strategic decisions. We have very structured meetings every Monday. We are very in alignment with the culture of the firm, where we’re going, very focused on all of that.
Michael: Okay. And what’s the size of the firm overall of client base or asset base or however you measure it now?
Julia: Well, I thought we were going to hit $300 million last week, but the market didn’t help yesterday. So we’re about…
Michael: Market volatility notwithstanding. So $300 million-ish.
Julia: Yeah. So we’re about $295 million.
Michael: And how many client households?
Julia: Probably about 1,000-ish.
Michael: Okay. So you really are right in that kind of classic mass affluent, couple $100,000 client average.
Julia: Yes. Although we have quite a lot on a digital platform. We’re seeing kind of a divide is the way that I’m envisioning this, where we have a very automated program that helps clients onboard themselves onto the digital platform. And those are for the clients that just need to save money, right? They just need to accumulate and have a good asset allocation.
Michael: And is that LPL’s Guided Wealth Portfolios structure?
Julia: Yes. So we’re developing more automated educational material, emails, webinars, education that’ll just get people to that platform. And then thinking of the people that we want to come to visit us are the people that really need our full services. They need to start thinking about their legacy. They’re impacted by the SECURE Act, right? And we want to help them navigate that and really help them with the distribution planning aspects of planning. So we have this kind of divide. We have a lot of clients that are eager just to get going. And that’s a lot of Dave Ramsey. So we’re trying to automate that experience.
Michael: Okay. So you were saying earlier you’ve kept a $0 minimum. So part of the way you’re doing that is Guided Wealth Portfolios is essentially your “robo” solution. And so, folks that just need that straightforward solution, you can route them there. They can do most of it themselves. Your Dave Ramsey referrals that aren’t a good fit for the core business can still get some help and a solution there. But it’s very limited time for the firm because it’s heavily automated for those folks.
Julia: Exactly. Exactly. I’ve had a lot of coaches and mentors and other advisors tell me that I have to start selling off my clients or firing clients, but it just never felt good to me. And so when LPL came out with this platform, I’m like, “This is going to work.” And we have been on the platform since day one in the pilot program, and I think maybe still even number one in the program.
Michael: Well, and it strikes me as well. I think there were a lot of firms that saw these digital platforms getting launched and said like, “Oh, I can put a button on my website, and people will give me money with no work. Like, sure, I’ll do that. That sounds great.”
Then, of course, assets don’t just freely fall from the sky. It doesn’t show up that way. But for a firm like yours that has a lot of marketing channels, has a presence in the community, that has a funnel of traffic that comes from the Dave Ramsey program, you’ve already got sources. You’ve already got a flow of these clients. It just becomes a question of, “Where are we going to route the people we’re already getting?” And then it becomes I think a little bit more appealing and easier to leverage and get something out of. Because you’ve got the flow, you just have to steer them somewhere. It’s not as though you just put the button on your website and wait for clients to show up.
Julia: Yeah. And do it in a way that is creating value for them, right? And in a way that they don’t feel like they’re just being brushed off, that, “No, this really is a good solution for you.” And we have computers in our lobbies that if clients want to come in, we can help assist them in getting them set up. And so it’s evolved over time, but we have a lot of momentum in that. And it feels like I can totally see it scaling in a profitable way.
Michael: So as you look at all of this change, what was the biggest shift for you from kind of the, I guess if it’s the measuring point, the pre-car accident days versus the post-car accident days?
Julia: I think I had to really discover myself and know myself and be okay with my strengths and actually lean into those strengths. Because what I’ve realized is that there are other people that are going to have the strengths to your weaknesses. And so it was really that.
And I’m still evolving, right? I’m only 42, and I’ve got a lot of career left. So it’s really keeping that discovery process, knowing what I want to do and what I’m good at and planting that flag, and then having this amazing team that can help see that vision and go there together as a team.
Michael: So how do you figure that out?
Self-Discovery Tools That Julia Uses To Measure Her Strengths [01:13:24]
Julia: Wow, there’s a very practical exercise that I have done that is really helpful. And it’s just about tracking. Like, thinking about all of the different things that I do in a week. Any of us that are listening to this – sit down and write a list of all the different things that you do in a given week, from grocery shopping to working out to hanging out with the kids to all the activities as a business owner, social media. I do a blog. There’s all these things, the client appointments, prospect appointments, networking, email, all of these things.
After you do that, then sit down with the list and figure out, what gets me excited on this list? What am I so excited to do on this list that it gives me energy, I can keep doing it forever, and it sows into my life? And then identifying the opposite to that, like, what is taking time that I’m doing that I don’t want to be doing? And so if you can do that…for me, it’s kind of a regular basis that I check in with myself and say, “Am I doing what I love to be doing? And how do I keep eliminating the things that I don’t like too?”
Michael: And when you want to eliminate them, then it’s, “Okay, I’ve got to hire someone else to do this.”
Julia: Yeah. Then it’s learning the art of delegation, which that was probably what I had to learn after my daughter’s accident. I felt like I had to hold onto all those things. Because, of course, I was the only one that was going to do it the special way that it needed to happen. But well, of course, you know that that’s not true. And so it’s like you have to learn that delegation is something we learn. It’s not something that we have in us. And so there is a lot of resources for that.
Michael: Are there any in particular for you that you use just to help figure out how to do that well?
Julia: Yeah. So it was through Strategic Coach. There was level, I think it’s called level one, level two, level three, level four. It’s very technical, but it’s…we actually printed the levels off and put it on every employee’s computer workspace. So when I was giving them a task, if I set a level one, it was, “Hey, research this and get back to me with what needs to happen.” Or if it was a change of address, let’s say, it would be a level four, “Hey, change this address. And I’m going to delete the email because I’m going to assume that you’ve got it.”
And so you want everyone to graduate to a level four, but oftentimes you have to go through, teach them the levels to build that trust with an employee, especially a new employee. So that was the model that we used to understand what my expectations were for the staff.
Michael: Okay. So were there other things that you were doing or trying or exploring or testing just to figure out this like, “What do I like doing? What do I not like doing? And how do I actually get rid of the things I don’t like and do more of the things that I do like?”
Julia: I have to say it’s pretty simple. Like when you can tune in and know thyself and then fire yourself from the other things, and then you have the freedom to do what you love to do. It’s really that simple.
Michael: So it’s mostly just in our heads that we don’t think that’ll work or limit ourselves or deny ourselves or all the other things that slow us down from that.
Julia: I think so. It’s definitely a mindset shift where if you’re…like when I was out of the office, things happened. When I’m not available, they figure it out. And now I travel quite a bit for speaking, for vacation, for doing things with my kids. I was going to add it up last year how many days I was out of the office; it was quite a bit.
And the team – when I come back to the office now, it takes maybe 20, 30 minutes to get caught up. The team is so efficient and trained that… And I’m at conferences; I don’t get interrupted. I don’t have to return phone calls at breaks.
What Surprised Julia The Most About Building Her Own Advisory Business And What She Would Have Done Differently [01:18:12]
Michael: Well, that sounds glorious. Wow. So what surprised you the most about building your own advisory business?
Julia: What surprised me the most? Probably getting to this place now. It’s like, to be able to say what I just said and that be true, that feels really good. Like I’m experiencing that freedom that I desired eight years ago when my daughter was in an accident, right? So it’s like, I can say it’s all happening. And yeah, it’s a surprise. It kind of feels like that, but it’s also, it’s exciting to see. And I’m just kind of excited to see where we go.
Michael: So, what does a typical week look like for you at this point?
Julia: So when I’m in the office, Mondays and Fridays are…Mondays are all staff meetings, executive team meetings. A lot of advisors call to pick my brain. So if clients or advisors reach out to me and want help, then I will save that for Mondays. If I do have client-facing appointments or seminars, workshops, that happens Tuesday, Wednesday, Thursday. And then Fridays are more…I’m usually out of the office early in the summer. I take that with my kids. And so it’s more of a flexible day.
Michael: Okay. And that’s something you try to hold to strictly now, of like, clients thou shalt meet with me on Tuesdays, Wednesdays, and Thursdays?
Julia: Yes. Yes.
Michael: And did you get pushback on that?
Julia: Of course, in the beginning. And I had to get myself out of…I had to get myself totally out of the equation because I would bend the rules for myself. So I had to have someone totally run my schedule.
Michael: So, what is that like? So you don’t control your calendar, someone else does all the bookings on it?
Julia: Yes, correct.
Michael: Once they didn’t have to ask you so you could feel like you wanted to make an exception, then the exception stopped.
Julia: Right. And they did come back for exceptions. We probably dealt with that for a year, of, “Oh, they’re used to meeting you on Monday, they have to meet you on a Monday.” And I’m like, “Well, they can meet this advisor on a Monday, but they can’t meet me on a Monday.” I had to back out of client house appointments, night appointments, weekend appointments. Because in the beginning, anytime you could meet, I’d be available.
Michael: Yep, yep, yep.
Julia: And so now, I went the whole doctor thing. Well, would they be able to visit their doctor on a Saturday? Probably not.
Michael: And your justification was like, “This is not how they’re meeting with their other professionals, I’m going to handle myself as a professional. That means they’re meeting me in my office on my terms, not the other way around.”
Michael: What was the low point on the journey for you?
Julia: Well, I probably have to say my daughter’s accident, but there were probably times before that building the business that were high highs and low lows. I think for anyone starting their own business, and especially in this industry, it’s that you go in such ebbs and flows.
There were a lot of times in those early days that I wanted to go back to a salary at the bank, or I wanted to give up, but it was just that pushing through all those nos to get to the yeses.
Michael: So what was the hardest thing to let go of after your daughter’s accident and all the things you were transitioning and letting go of?
Julia: I think the client appointments. That was…
Michael: Like meeting-with-client appointments or just scheduling the appointments?
Julia: Oh, no, meeting, meeting. There were times where I would run, boy, 35 meetings a week back-to-back-to-back-to-back. And then stay up. Well, that was before kids. All the time, I was working, building it. Yeah. And I really enjoy that. I enjoy helping and doing that.
But over time, do I want to be a business owner, or do I want to be an advisor? And do I want to help…I can make a bigger impact if I help other advisors and train them and groom them and grow the company. We can have even more impact. But giving up those one-on-one relationships has been difficult.
Michael: What was the blocking point for you? Was it the relationship literally, or not knowing if this other advisor is going to take care of this client the way I want them to be taken care of?
Julia: Yeah, I think probably the clients that weren’t near and dear to me it was probably easier to give them up. But it was also making sure that we weren’t going to have complaints and they were going to be taken care of. And are they going to do it the way that I would do it? So those were all the kind of things. Are they going to get the sale? Because if I was there, I’d get the sale, that kind of stuff.
Michael: So how do you work through that? Because you want the sale, you want to get the client.
Julia: Yeah. So Chandran has developed a training program in sales and influence. And we have alignment with how we do that. And so he has taken over the accountability and responsibility of training the advisors.
Michael: A fairly straightforward answer at the end of the day. Like, if you’re worried that they’re not going to get the sale, then teach them how to sell, teach them how to get the client.
Julia: And here’s the bottom line, I’m sure we have lost some, right, that I would have gotten. And we have lost some clients that weren’t okay with not having me. But for us to evolve into this true team that we are today, it wasn’t going to work if they could only talk to me. So on the one hand, because we do have so many clients, losing one client isn’t a huge impact, although that is never the goal. But if they’re not aligned with who we’ve become in this evolution of me to a team of 13, then they’re not a good fit for us anymore.
Michael: Well, there is an interesting effect I find that comes, that in the early days where the business is maybe not where we want it just from a revenue and income perspective, it feels very, very hard ever to do anything that could risk a client relationship because I need that client. I need every client. I need every dollar coming in because I’m trying to get to a certain level.
But there comes a point in the business where, as you know, when you have 1,000 clients, losing 1 is not going to blow up the business. It’s not going to undermine the ability to be reasonably on track for goals this year. At some point, the incremental learning value for the advisor that had a shot and missed it and can learn from it is actually probably more valuable for the business in the long run than just getting that one client and not having the advisor learn the lesson.
You just either have to get to the point where you’re large enough to be able to manage that or just have the mentality to say, “Well, bummer, we lost a client that maybe we sort of needed, but this is still better for us in the long run.”
Julia: And how do we learn from it moving forward? Yeah.
Michael: So anything you wish you’d done really differently? Aside from just growing the business beyond yourself. So in the aggregate discussion, what do you know now that you wish you could go tell you from 10 years ago as you’re making this transition to LPL?
Julia: Yeah, I feel like getting out of my own way earlier on. And so being open to listening, not being so reactive, right? We have an amazing team, but we also lost a lot of employees. And we had that turnover because of the way that I was managing them. And so, yeah, that was…when I got out of the hiring process, that was the biggest win for the company and relief for me.
Michael: And what do you attribute that to? Is this just like, in retrospect, I’m just not the best at figuring out who’s going to be a good fit employee or not? Or was there something else to the challenge of having you in the hiring process and feeling better that you’re out of it?
Julia: What was happening was I would get people excited, and I would inspire them, and it would be all future focus and all, “We’re going to be excited, and you’re going to be a great fit.” And not really being able to ask the right questions and not see the best in someone, or be able to really make sure that this was a good fit for the position being hired. Because, naturally, I want to see the good in people, and I also expect everyone is going to be as driven and determined as me. And that’s not the case.
Michael: So just letting go of the hiring process, got it to someone else who was just better able to figure out who is going to be the right fit – the right person, right seat in EOS terms – and just get them grounded to, “Here’s what you’re really good at. Here’s what our position actually needs. Are these lined up appropriately?” So is it strange to be the owner of a firm that isn’t making the hiring decisions for the people whose paycheck you write?
Julia: No, it’s liberating. It’s fantastic because I don’t have to do the firing either.
Michael: Oh, that’s a good trade-off then. That’s a good trade-off. But again, I think that’s part of the challenge, right? Like, as you were saying, there’s sort of these things that we “should” on ourselves. Like I’m the founder of the firm, or I own the firm, I should have to make these decisions and make these calls.
I think one that we often tend to keep is around talent and hiring and who works in the business or not, that it’s a big transition to say like, “No, I actually don’t need to be the one that runs this process and makes these decisions.”
Julia: It comes back to the in charge but not in control.
Michael: So what advice would you give to newer advisors coming into the business today?
Julia: I feel like they have to decide who they want to become, right? Do they want to become a business owner? Do they want to be part of a thriving team? Deciding that path is important in the beginning because we have to decide and then visualize what we want for them to go make that happen.
Michael: Well, then I’ve got to ask, you started down that path, and you changed your path. So is that like, “I probably would have been on this path all along if just someone had asked me and I had spent more time on it sooner,” or did you have to do one path before you could get to the current one?
Julia: That would be my guess. I feel like that was all kind of my journey to get to where I’m at today. I had to go through those experiences to get to today. Yeah. So it’s hard to really go back and say I wish things were different because I don’t really.
Michael: Yeah, it all becomes part of the journey. Well, so does that impact what you would tell someone coming in who maybe doesn’t know what their journey is going to be or like, “What do you want to become?” “I don’t know.” I didn’t know what I wanted to be at 20-something years old. I guess, in retrospect, I had a few ideas in my head, but those didn’t particularly line up to what I actually ended out saying I like to do after 5 or 10 years of experience.
Julia: Yeah. So maybe a better way to answer that is being open. And you have to self-discover about yourself and being open to the different opportunities that come your way. It’s hard, I think, for someone brand new to start a business even as a solo advisor today. It’s a lot different than where it was 20 years ago.
Michael: Yeah, on the one hand, like, way cooler technology and efficiency to do stuff now than what you could do 20 years ago. I think the challenge is just that it’s a more crowded landscape. Back then, there were a lot of people that said they did “financial” advising, but they were really predominantly in the product business for the overwhelming majority of advisors.
Now there’s a lot of people that really focus on giving clients financial advice, really being focused on the advice. Just like saying, “No, no, we actually do it” doesn’t work now the way that it did in the past.
So aside from the shift that happened from your daughter’s car accident, was there some point where you looked to the business and said like, “We’ve made it? Like, it’s worked, the transition has worked. I’m really in a different place now?”
Julia: Probably just the last couple of years when profitability came back, right? There were several times when I would do those silly benchmark studies that would be like, “Oh, okay, you’re spending too much money in this area and too much money in marketing and too much money on staffing.” And I’m like trying to shake them saying, “Yeah, but I’m reinvesting into my business.” Right? Like are they growing?
Are those other advisors that I’m being benchmarked to growing at this rate? Right? Because there is a time when we had very small profitability in an industry where you should have pretty good profitability. But I’m seeing that profitability back now, which is really exciting to see.
Michael: Yeah, there’s…it’s an interesting effect to me that our industry spends a lot of time talking about the profitability and not a lot of time talking about the growth when the reality is well, the more you spend on marketing, the less you will have on profitability because marketing tends to come from free cash flow to reinvest for growth.
So like, granted, there’s a whole other discussion about whether your marketing is getting you a good ROI, but just in general, firms that are trying to grow more and reinvesting more into marketing will have lower profitability that isn’t necessarily a sign of anything negative or unhealthy in the business. Like, that’s the point of investing for growth.
Julia: Exactly. And I wasn’t going to take debt to put capital into my business, right, to do that. I’d rather take that from profits.
Michael: All right. And then you have to hire the staff, and you want to grow faster? Someone’s got to help run the marketing, and then someone’s got to screen all their calls, and then someone who may not be a full advisor yet has got to take the actual clients that you’re bringing in, but you’re going to try to ramp them up quickly. There’s a lot of hiring and spending that happens when you’re really trying to power organic growth.
Julia: Yeah. So maybe when I was talking about deciding what you want, I didn’t know all of those different intricacies. I didn’t realize all those ceilings of complexities that I was going to be hitting along the way. So now looking back, when other advisors reach out to me and ask for help, I’m like, “Okay, let’s first celebrate the frustrations you’re experiencing because it means that you’re hitting the ceiling where you need to bust through and get to another level.”
So for me, I didn’t know that it was going to be that hard back in the day. I just thought, “Oh, I’m going to build up a good business.” And does someone brand new want to go through all those trials and tribulations and get to the other side?
Michael: I love the way you put it: these ceilings of complexities that you grow and you hit, and they become ceilings and you whack into them and they stop your growth and they halt you until you figure out how to work around and work through them.
And then, when you get through them, you get another growth cycle until you hit another complexity ceiling. And that happens because that’s what happens when the firm gets bigger and there are more people; it also gets more complex. So is there a complexity ceiling that you’re staring down now or worried about now?
Julia: So I hear one is coming around $3 million in revenue. So that should be pretty soon. I’m hoping that we have put the structure and everything in place just to bust through that and not even feel it. But I also know to celebrate those frustrations for myself as they come.
Michael: And what does that complexity ceiling look like for the firm? Are there pain points you’re expecting?
Julia: What I feel is that I have to get out of that client-facing role. I’m thinking about how can I do things in group settings? How can I use technology more? How can I do things where they still satisfy that need in me to connect and educate and inspire? But I feel like my greater good is going to be on a bigger level than the one-on-one.
What Success Means To Julia [01:36:55]
Michael: So as we wrap up, this is a podcast about success, and one of the themes that always comes up is just that the word “success” means different things to different people, sometimes very different things to us as we go through life and changes happen in our world.
So you’re on the path of this incredibly successful business trajectory and closing in on $300 million of AUM and $3 million of revenue, how do you define success for yourself at this point?
Julia: Great question. I feel I’ve had success at different moments. I feel like it’s also been redefined in my journey. Now I feel like it’s that fulfillment of happiness and feeling joy and not feeling that I have to be onto the next and onto the next, but that I can enjoy the moments more in the day-to-day.
And giving back to my team, giving back to the industry, speaking more, all of that is feeling really good to me and making me feel fulfilled.
Michael: Well, very cool. I appreciate you willing to join us and give back to the industry and sharing just the story and the journey from advisor to advisory firm business owner.
Julia: Thank you.
Michael: Absolutely. Thank you for joining us, Julia, on the “Financial Advisor Success” podcast.