National financial advice firm Wealth Architects is targeting advisers looking to leave the large licensees and helping them run their own business.
Speaking with Money Management, managing director Callum Mitchener has said the firm is seeking to work with advisers who want to run their own business but may be deterred by the complexity of starting their own from scratch.
Wealth Architects has three offices in Victoria, five in Queensland, three in NSW and it also completed on two further practices in regional Victoria this week.
The structure works by acquiring firms, rebranding it as Wealth Architects and then setting the adviser up to run that business, reducing the business complexities for the individual adviser and providing them with financial backing and tools.
Mitchener likened the strategy to a nationwide advice franchise model whereby advisers have “skin in the game” at the business.
There has been a notable trend towards so-called “micro-AFSLs” as 92 of the new licensees which commenced in FY24 have less than 10 advisers, according to Wealth Data, and they are gaining greater popularity as individuals exit the large and mid-tier firms. However, the micro-AFSL model presents its own problems when it comes to scaling up the business or advisers taking too much work.
He said: “These advisers want to have a stake in something so we give them a small shareholding in a business. They won’t own 100 per cent of the business, but it’s a starting point for them, then they work their way and gain a greater equity stake.
“We are looking for those PAYG planners who are dying to get into their own business, who are going to work hard and bring some clout; we are teaching them to be business people.
“We do the due diligence, we provide the capital, we set up the infrastructure and then they follow the process and work hard.”
As to the type of advisers he thinks the model would suit, he said the business looks for those who are ambitious and entrepreneurial.
“We want ambitious ones who want to do well in this industry and to learn about M&A, driven financial planners who are looking for something more than being stuck in the rat race and who have an entrepreneurial mindset.
“We’ve done about 14 acquisitions already, so we know what we are doing, but you need a driven planner for it to work. It is not for someone in their 60s who is looking to retire.”
The firm also supports ambitious advisers who are in “start-up financial planning businesses”, if they have solid business plans.
“Our goal is to look for the best talent in the market and find a solution that works for both parties,” Mitchener said.
Money Management previously spoke with Mitchener in March, when the firm was in the process of acquiring two practices in regional Victoria, and he discussed the opportunities beyond the large capital CBDs.
Why would you do that for? It would be a case of the same circus, different clowns.