Focusing on the Right Business Model

It really is all about you when determining which business model to pursue.


The focus in the independent advisory world these days seems to be on service models, that is, creating new and better services for today’s investors. Discussions on this topic typically go like this: “What type of clients are you currently attracting or would you like to attract?” Followed by,

“What services do these clients want and need?” But these are the wrong questions to ask. Most of my time is spent talking to firm owners about what they would like their businesses to become and then working with them to build those businesses. Today, owners’ goals usually focus on a target AUM number (like $1 billion) or annual gross revenue (such as $5 million). These aren’t the right goals, though, because once they are attained, business firm owners usually are less happy than before.

All of this stems from having asked the wrong question from the beginning. Rather than starting with the clients they want to attract, firm owners should focus on which services they truly want to provide.