Financial planners can have their businesses valued and benchmarked by three leading financial planning practitioners, and put on a path to boost revenue by a minimum of 50 per cent for as little as $10,000 to $15,000.
The ifocus service offered by a new consultancy, Peloton Partners, seeks to extract the latent value that exists in advice businesses by helping principals make the necessary changes to improve the client experience, lift earnings and maintain momentum, ultimately leading to a better price and more attractive terms at the time of sale.
Peloton also provides advice on practice management, succession planning, introducing an equity partner, listing for sale and preparing information.
According to Rob Jones, Peloton Partners director, principals are typically too busy working in their businesses to identify and unlock potential growth areas.
He said most principals had unrealistic expectations about what their business was worth because they either hadn’t had them independently valued or calculations were based on legacy pricing. These people should brace themselves for major disappointment, Jones said.
“We exist to help advisers and accountants run better, more productive businesses and increase the fundamental value of their businesses,” he said.
“The starting point for every principal is to really understand their business. There isn’t one, single blue print for success, and we won’t know what needs to be done until we get in there and look at the business.”
Peloton is run by Jones, formerly head of mergers and acquisitions at SFG Australia, and former financial planners Michael Harrison and David Murray.
In 1990 Harrison co-founded Heraud Harrison, which later became a foundation member of SFG Australia, while Murray co-founded FMD Financial in 2001.
Murray said the firm was fielding a lot of enquires from advisers who needed advice on how to account for, and ultimately replace, income streams that are grandfathered under the Future of Financial Advice reforms.
“This period of uncertainty presents an opportunity for advisers to restructure their businesses and change old models, and we are having a lot of positive conversations about these issues,” Murray said.
“We bring a practitioner’s view and a buyer’s view to the table because we’ve been on both sides, and this is unique. Practice management is done better by practitioners.”
Harrison added that well structured, quality businesses weren’t negatively impacted by legislative changes and increased regulation.
