Two weeks after the firm took on a major transfer of personnel from Westpac, Viridian CEO Glenn Calder says the number of authorised representatives operating under license has now increased from 40 to 150.
Seventy of the 110 extra advisers joining the Melbourne-based group are former internal Westpac advisers, otherwise known as ‘partnership’ or senior advisers, according to Calder. Of the more than 400 Securitor and Magnitude advisers Viridian presented to across the country in April, 40 took up the offer.
In total, 160 Westpac staff and 7000 clients were transferred to Viridian on July 1, Calder reveals. “That was the big date for us,” he says.
“It’s going to be exciting,” Calder continues. “Culturally aligned people are finding us at a rate of knots.”
The firm is in the process of expanding into a new Sydney office, where it plans to take an entire level of a building to house staff. Calder says managing the expansion has been a challenge. “We’re fitting out, simultaneously, about 20, 22 new sites around the country,” he adds.
When Viridian took their proposition to advisers in April Calder told Professional Planner it wouldn’t “be begging advisers to come across”, and that cultural fit was more important than raw numbers. While he now admits “you need a bit of scale”, Calder is adamant that growth is secondary.
“I don’t feel like we need to trumpet or promote Viridian. If we double [in size] it’s for the right reasons, but if we don’t grow at all I don’t care about that one little bit,’ he says.
At March last year Viridian was the 100th largest licensee owner in the country with 26 advisers; 150 advisers would see it sit roughly equal with Sentry Group at number 27 on the list today.
Increasing the tendrils
Calder is keen to knock down rumours the Viridian ownership group is looking to bolster the firm’s books so it can be sold at a premium shortly thereafter.
“Not while I’m here,’ he says. “That will not happen.”
The business has a “great model”, Calder continues, and “no problems raising capital”.
“I think what we’ve got is fantastic, and if people want to spread rumours that speaks more to them than it does us.”
He says Viridian is open to taking equity stakes in the businesses they oversee, “but only if they were completely culturally aligned”. If this were to happen, he notes, it would be in the interests of sustainability rather than increasing the “tendrils” of the business.
‘But I wouldn’t rule it out,” Calder adds. “I really wouldn’t.”
Roll impact rating
Advisers in Viridian must own shares in the firm, effectively making every adviser an owner and promoter, Calder explains.
Under its “Roll Impact Rating” system, advisers are rewarded for making an impact on the business by being offered equity stakes. Calder laments how few other firms employ a similar system.
“It’s an industry wide problem; you’ve got a business with two or three owners and they’ve got some cracking staff but they can’t work out how to get them into ownership. Why wouldn’t they use the same model?”
Viridian uses equity incentives in lieu of paying bonuses or commissions to advisers. There is no point making long-term promises to clients, he explains, while doling out short-term remuneration incentives to advisers.
“None of that makes sense,” he says. “Make long-term promises and remunerate your guys with long term-equity stakes.”
The firm also offers equity stakes to their financial advice clients, “about 50” of which have proceeded. While he calls it a “great principle” Calder admits the client ownership process can be “relatively clunky’, something that will only be exacerbated with 7000 new clients. The firm needs to be wary of conflicts, he explains, and external advice must be sought by the client.
“We want to open it up but we need to do a complete legal review,” he adds.