Advice licensee Sequoia has shared an update on the streamlining of its operations in the new financial year, following an attempted shareholder rout.
Earlier this year, the firm was subject to a shareholder rout where a group of shareholders tried to bring in two new board members in Peter Brook and Brent Jones to replace managing director Garry Crole and director Kevin Pattison.
At an EGM held in June, the shareholders were unsuccessful in their plans but Sequoia committed to making changes in the business to reflect the shareholders’ concerns.
This included streamlining the current operating business model, streamlining the divisional business structure, being open to divestment opportunities for non-core businesses, and increasing scrutiny on underperforming parts of the business.
As a result, since June, the firm has divested its Informed Investor subsidiary to capital markets company Powerhouse Ventures, agreed to appoint a new chief executive in June 2026, and announced a restructuring of the business which will mean a 10 per cent headcount reduction.
The firm said it will move from having four reporting divisions to just two for FY2024–25; the new divisions will be licensee and adviser services, and legal and administration services. Licensee and adviser services will include InterPrac Financial Planning, Sequoia Financial Advice, Sequoia Family Office, Sequoia Corporate Finance, Sequoia Wealth Management, Sequoia Asset Management, and Sequoia Specialist Investments.
In a presentation on 30 October, Crole said: “Since reporting the FY24 results, the business has continued to actively streamline operations divesting three non-core businesses Informed Investor, Corporate Connect, and taking control.
“The Sequoia Specialist Investments business has scaled back new business, had a management restructure, and is forming strategic relationships with key market players.
“As a result of streamlining and reviewing focus, the core business is well-placed for strong organic with acquisitional growth, mostly concentrated in the legal and administration services and our salaried advice business.”
Investing to grow Sequoia’s higher-margin salaried advice business is an increased focus for the licensee, it said, echoing comments in its FY24 results that 70 advisers had joined the business.
“The advisers who we have been bringing into the business are higher-income generators than the advisers we were losing. The 70 advisers that have joined, we expect their income for the 12 months to be $18 million. The 56 advisers that have retired, or merged, or left the industry, was about $6 million.
“So the net growth in prospect of organic growth over the 12 months was very positive so we are seeing double-digit revenue growth from recruiting and that’s extremely positive,” Crole said in August.
It also resolved a court action between Sequoia Financial Group and individual Tim McGowen regarding a problematic acquisition of three companies. This related to an acquisition in 2022 of ShareCafe, Corporate Connect and Informed Investor, where McGowen was the managing director.
On 16 August, Sequoia said the court case between the firm and McGowen had been resolved with a confidential settlement.
