#305 Darren Johns – Transcript

Ben Nash
Hey guys, Ben Nash from the XY advisor team. And today I’m pumped to be here with the original beachbum advisor, Mr. Darren Johns, the one and only. Darren is the founder, director and advisor at a line financial, they’ve been going for almost two decades, which is, you wouldn’t tell from that baby face of his but go to good longevity. Darren has been well recognized for all the amazing work that he does, including being ordered the advisor of the Year from the Association of financial advisors. Darren, thanks for joining us, buddy.

Darren Johns
Pleasure to be here, Ben and to see your smiling face.

Ben Nash
Well, mate, I’m keen to get into it. Because as I said, your business been around for a long time. And I know you’ve racked up a bunch of accolades for the amazing work that you do with your clients. So I thought maybe a good place to start is just unpacking the story and the evolution of your of your business and how you’ve ended up where you are today.

Darren Johns
Yeah, sure. So I had the luxury of starting with a pretty clean slate in 2005, I broke away from a small advisory firm where I was and I just purchased a dozen or so clients just enough to, you know, pretty much pay their rent and pay their electricity bills on day one. So I got to design a business and I thought, Well, look, if I want to be a client of this, or if all my parents are going to be a client of my business, what would they want to get? How would I want to deliver it? And how would they receive it. So I got a really privileged to start with a clean slate that didn’t have any legacy business or anything like that. So I just built a a small advisory business giving all the advice, guidance, care and love we could the clients and just sort of added to that over the years in terms of what we actually delivered what we provide how we provide it, either in person or remotely digitally. And on boarded clients with a similar mindset.

Ben Nash
Picture on on like, Who are you serving? What are you doing? How do you work with them? What does your team look like client numbers?

Darren Johns
Yeah, right. So I’ve done the course as with Bill Bacharach, and Jim Stackpole, John Bowen, you name the courses I’m done, I’m a bit of a course junkie, and most of them will tell you to Nice, nice, nice, nice, nice. And I think that’s a very, very good idea. I just have just in business, decided not to niche in any particular field or specialization, I just tend to work with people I have a good common interest with. And we have mutual respect, and, you know, care and appreciation for each other that so that’s our nice weather there people who have you know, sold a house sold a business or started a company, it doesn’t really matter where they come from, or what they are, right now and metrics for a company. So there’s only two staff, there’s, there’s an ad out right now, for an office superstar. So that’ll be three joining us shortly. We have 74 clients. So on average, one half client meetings per week. And we onboard about five or six new clients per year. And I think we’ll hit some kind of a soft ceiling within the next two years or so in terms of capacity to serve as clients.

Ben Nash
And what does that mean for your because you, I think we were just chatting a bit offline that you’re, you know, essentially running it in a way that sort of fits in with the lifestyle that you want, you got a family, you know, allows you to do all of those things that you want. From your time perspective, what is what does that mean in terms of your ability to take downtime and work and that sort of stuff?

Darren Johns
It means that I don’t ever struggle when I complete the surveys about do you spend enough time with your family and children? Do you have enough leisure time? Do you have a work life balance? Do you need to solve any of those sorts of things I’ve chosen to to build a business that provides outcomes and results, but isn’t necessarily dependent on me being attendance at a particular address nine to five, five days a week, 52 weeks a year.

Ben Nash
That’s probably pretty handy because every time I drive over the Narrabeen bridge, I see you to stand up paddleboarding off in the in the distance. I feel like you know how to do file notes with that paddle in your hands. Right?

Darren Johns
Correct. And in fact, we’ve I’ve introduced something lately, whereas if I meet with product providers or bdn BDMS or someone who’s likely to want to sell me something, we do walking meetings around the lake, so we don’t just come in and sit down we go for a walk around the lake, you’ve got 35 minutes because that’s how long it takes one way to the beach and back. We talk and we walk so recommended to anyone Yeah, good way

Ben Nash
to keep the steps up. Yeah. That’s correct. What were the biggest challenges when you kicked off in the early days, and you’re looking to sort of start out with your solution,

Darren Johns
I think it was knowing and being told and having done the course is to be selective. But when you’re looking at your bank account each week, or each month, and you’ve got staff to pay, and knowing that there is just a lot of other potential work out there, but doesn’t fit your ideal client profile, just trying to keep true to that. And balancing the fact that no, the results will come, the ideal clients will come. And just trying to keep focus on just onboarding clients that you know, are a good fit with our business, and that we can actually serve and add value to them, as opposed to just taking the income in those early years. And just saying, Okay, let’s just, you know, let’s, let’s sell one event, anything to everyone if we can. And I don’t think that’s changed a lot today. But I think people still experience that, you know, 1516 years later in business today.

Ben Nash
It’s yeah, it is still hard. It’s always hard to say no. And I have found in, in my business that in the earlier days, I, especially when I was the one I was doing the sales, I was doing the delivery, I was doing the advice. And plus, I just obviously I want to grow my business. And I would like to make money. And I love helping people as well, that it’s like you see someone in there like way outside of what you typically work with. But you can see that there is a real need for help see that there’s a commercial opportunity there and you want to help someone. And while that can all be true, I found that those ones they end up just consuming so much time and working outside of that, that you just end up regretting it even now, and I’m having this conversation with our, our, our sales manager, our relationship manager that she obviously she wants to get her deals and he heard numbers. But when you got a client where what the sort of help that they want even just doesn’t quite 100% match with what you want in like that they’ve got something that’s really particular need or philosophy or, you know, thinking process around a particular aspect of their money. So if it’s not lining up with, I’ve learned that we have to say like this, no, it’s better to speak to somebody else, find that alignment, then you’ll be a good client for them, you get a better outcome. Because when you when you do that, it’s like you can still deliver, but you end up spending five times as long because it’s like, you’ve got to then go back and go back and just just, you end up regretting it. And I think in a level as much as you can do things to get to a point where people walk away happy, it is just not worth it on both sides in terms of the inputs that you need.

Darren Johns
It is but you did touch on one interesting point there, which a lot of advisors I know have is that they actually genuinely want to help people. And so if you’re taking a phone call from, you know, a new prospect and they said, Look, I’ve asked this person, I’ve asked this person, nobody seems to be able to help me with this particular issue or this challenge I’m facing can you help and I describe it to you. And you’re like, you know what, I probably can’t help you there. It’s difficult when you’ve got that bit inside you that just wants to help people and just know they won’t get the advice that they need anywhere else. But then how do you dispatch that in a, you know, in a fair and profitable and equitable way? It’s difficult when you’re you want you want is to actually help people? It’s difficult.

Ben Nash
Yeah, absolutely. And what do you what, you know, you guys have been in business for over 17 years, what have been the biggest shifts? Like what’s what’s changed the most I know that you said you said the market sort of similar and you just been following that steady pace of growth. But what have been the biggest shifts?

Darren Johns
Well, from an advisory point of view, I think when I got my first letter of authority, the director of the dealer group just did a background reference check and wrote me a letter and said, Hi, Darren, you now authorized to give advice that was about the extent of it. Now, you know, the advisors have to do degree qualified, they’re required to do their py, there’s a whole lot more, which goes on up front, which I think is fantastic for us as a profession. Because it means that all new entrants and all our peers are, you know, really, really well qualified day one. They might not have the interpersonal skills yet. But they certainly have the, you know, the written and the educational piece down pat, which is fantastic. But in terms of what maybe hasn’t changed, if I’d answer it that way. We’ll still need advice. People are still just looking for somebody you know, to say, Can I do this? How much do I need to save? Am I making silly mistakes? Do I have enough? The questions that people are asking on the street have not changed. In the 20 years I’ve been doing this Despite the fact that all the products, bells and whistles, all the the tools and the little things we use might have tried, it might have changed. But the thing that, you know, the underlying question that people are asking in the street, our clients that we help, I don’t think it’s changed at all.

Ben Nash
Yeah, it’s funny that I think that we are probably pushed more along that curve, though, in terms of those conversations in that, historically, like, advisors would be there. And a lot of advisors build great businesses around providing specific products, basically product related advice and product related services and investment management advice and services. But I think as technology is, meant that there’s more offerings in that space that people can access at a lower cost, you know, potentially with a slicker user experience, it’s maybe more on demand, it’s meant that, that people that advice, clients and consumers and we were just chatting bit offline about the increasing costs of advice and the inputs and all those things that people are really that they’ve, they need those higher level questions answered. And you because that was your just philosophy and approach that you will focus on answering those from the start. But I think that that that really is the future, as we said, gonna see less and less advisors that are involved in the product side of advice still involved, because it’s linked by where the true value is in the product and technical and the more value is in support the confidence, the peace of mind. Correct?

Darren Johns
Correct, correct. And the big movement on that in the US, you know, it’s what they call financial life planning or life planning. It’s a fantastic world, there’s a little bit of it over here, but in the USA, of this, you know, great breadth of knowledge on this concept of financial life planning, where they don’t quite get people on a couch, you know, we’re not therapists yet on our counselors, but they really, really try deeply and hardly tend to get people to, you know, understand and relate and link their money to the, to the values and their lives. I still give advice on the products and the bits and pieces, but but they, they just try and make it a whole lot richer experience. And it’s the great world of knowledge and people out there. If you’re interested in that sort of stuff.

Ben Nash
I’m very excited for the day where I can just put all the technical and product stuff into a little computer machine and then have that spit out the other end and focus on the client and the values and those conversations and confidence in the bigger picture decision making. I think that that is really where the true value of having a human as opposed to a solution sort of fits with this process. So as much as the machines are obviously smarter than me and almost as smart as you. I think that you know, the what they can’t do is when people are making million dollar decisions, give them that that same level of peace of mind that you can from just looking someone in the eyes? Correct. I’m excited for that. Correct, about the advisor of the year process and sort of how you ended up on that path, what some of the things were that they focused on and how that all came together.

Darren Johns
So I’d looked at knocking our little business into shape, to try and compete in an award or just have our processes and what we do kind of vetted and I spoke to a mate of mine and advisor may David Reed, who actually won the award the year before I did. And he said, Look, what do you think? And I said, I’m thinking about entering it, you know, maybe in 12 months time he goes perfect. You’re ready. I said what do you mean? He said you never ready? He said no one ever has an empty inbox. Has all the tasks checked off? Has all their filing done? And is everything in business exactly where you want it. And if you reckon you’re within 12 months of that he said Enter it right now. So I did and it was a really, really good process going through the process. The fact we won was a massive bonus, and a terrific honor and thrill and something I’m still, you know, I get tingles about when I think about itself. But going through the process was terrific for our business for our staff and our clients. And so what I mean by that is you get all of your what you actually the meat in your sandwich, you know, your financial advice sandwich, what you deliver to a client, you get looked at by outside people, and they’re comparing your sandwich or your burger or what you’re offering with 10s or potentially hundreds of other advisors across the country that they’ve seen. So you get a good bit of feedback on whether they think, you know, there’s relative value in the financial advice you’re providing. Then go along the steps little bit, and then they say, okay, that’s what you say you’re doing. Can we survey your clients? And can we see if they actually think that you know what you say you’re doing, they’re actually getting value out of the other end. So you get, you get a terrific survey conducted on your clients, by third party. Interesting

Ben Nash
clients find that like, where they open to spending the time, because obviously, there’s a bit of time involved there and to participate.

Darren Johns
Correct. So an interesting offshoot of that is the two clients that we had at the time that had a bit of resistance and reluctance, both left us within 18 months. Is that right? So I’m not saying that it wasn’t a predictor or a forecast. But the two, the two clients who pretty much declined to provide feedback to participate in the survey of client satisfaction survey, both moved on for different reasons within 18 months. interest that was kind of an interesting little, little side, side chat. Some of the other feedback, you know, a lot of it’s glowing. And then a lot of it’s like, oh, okay, writer, I asked for it, you gave it to me. And then I think the worst thing you can do, there is nothing about it. Yeah, if somebody gives you a bit of feedback that says, look in this area, or we don’t quite understand this, or they’ve always talked about this thing, we’ve never know what he’s talking about, or something like that, is if it goes unaddressed. So we then had the task of going through and say, Okay, well, let’s, let’s address all of these areas, best we can. So that was great, because then you get to tailor your service delivery to your clients.

Ben Nash
And what were the big things that while obviously you were doing a fantastic job, which is why you won the award in the first place. But like were there any significant changes that came off the back of in terms of how you work with your clients, how you engage with them, how you deliver information to them, like from those insights,

Darren Johns
there was a little bit of how we reported to clients which change so we’d been not quite the case. But say we’d been sending in a, you know, you have a balance sheet in an Excel spreadsheet with a bar chart for the past six years, and say, okay, Ben, and Ben’s family, here’s your, here’s your financial progress over the past six years. And we got some feedback from a client that said they could never understand what was going on. And pretty much all I did was change that bar chart to a pie chart and recenter it. Darren, this is the most fantastic thing, I can’t believe that. And honestly, it was almost that simple the change we made. But because we were able to hear from the client, that they weren’t quite getting what we were sending them, even though to me, it was playing what they then got the value of the advice we’re providing, and I thought, Oh, this is fantastic. I can’t believe this.

Ben Nash
Well, there you go, just goes to show that you never know, what are the things that we just take for granted that you, you know, think makes sense that little things that people just don’t gel with? And you can be guaranteed that if one person is missing it, then there’s a bunch of others that are as well.

Darren Johns
Absolutely. So the difference between the message given and the message received this sometimes a massive gap in between. Yeah, and what

Ben Nash
happened after so you went through the process won the award? Did you know Did anything else like it? Did it move the dial in terms of engagement with your clients or new clients? Or what did you you know, post the post the actual award itself.

Darren Johns
So I think clients felt a sense of validation and some comfort, knowing that the advisor they’ve chosen to work with has been tested against peers and came out, you know, on top, which was a nice thing for them. And then you don’t I spoke to other advisors who’ve who’ve done been through a similar process you you don’t get 60 referrals a month after. But what you do get is the client gets a much easier conversation to perhaps refer their clients or friends or introduce their friends. So whereas before the winning the award, our clients might have said to their friends, oh, yeah, I’ve got this advisor Darren, he’s a good guy and they look after us really well provide us great advice. They say the same thing. After we win the award, they get to say yeah, we’ve got this advisor Darren, he’s good guy provides great advice. And he’s the Australian advisor of the year. So just that little bookend to that introduction, just helps, you know goes a long way for the kudos. Correct? Correct. Would that first step so then you know, we did fine, fine and still find that the phone rings more often? Because you do have a little bit of peer validation of your business and what you do

Ben Nash
Interestingly, I’ve spoken to a few other award winners, as well. And some of the feedback that I’ve got from them is around that, when they have that sort of external validation of what they’re doing, it also gives them more confidence in their solution, which means that they’re even more because I think sometimes you subconsciously like, you know, benefit from having that where, where people go, Yeah, I’ve thrown down with the best. And you know, we came out on top to then go on push for people to say, what sets your party would you say that’s something that you’ve experienced?

Darren Johns
Yeah. And it just also gives you a confidence that, okay, what we do, because we all, most of us, right advisors, most of us just build our little cottage industry in our little offices independently of one another. And there’s, there’s very, I mean, there’s strict guidelines in terms of what has to be in a statement of advice, but there’s very loose guidance as to what actually constitutes a financial planning, advice, relationship and what they have to do for a client over the course of a year. So we’re all building these different things and delivering different things. And it’s, it’s, it does give you good confidence and comfort to know that what you’re actually doing. So how you’ve built your sandwich and how you dispatch it has been looked at, and you know, other people, third parties, external consultants, people looking to critique your business, think actually, what you’re doing is pretty good and reasonable. So that’s, you then gives you confidence to have the next conversation with the next prospect to say, here’s the advice we give, here’s what we do, here’s what I face. Here’s where you can find us.

Ben Nash
That’s it. Yeah. And I think that having, again, like for standing up on the fees, and especially in an environment where our fees are, you know, increasing in line with all the requirements on a business and compliance resource in licensing and PR, and all of those sorts of things. You need to have good confidence to be behind that. For sure. Darren, if you could go back to your yourself on day one of kicking off your business? What do you think? What would you do differently?

Darren Johns
I’d go into a niche. Yeah. Yeah, I think. I don’t know. It could be knee surgeons, it could be you know, HP executives working out of Newcastle, I don’t know. But I think I’d find a deep and narrow niche and go into it and just spend time in there.

Ben Nash
And what do you say that because you said at the start that you you obviously you didn’t do that. And then your businesses obviously kicked a whole bunch of goals along the way. So what’s driving up?

Darren Johns
Because if I remember your question correctly, so if I could go back and do it again, I’ve done it this way, once already, not that I’m finished. But I’ve done it one way, just working with people I really enjoy. And people are like being not nice, specific at all. That is terrific. I think from a client relationship point of view. It’s not terrific, terrific from a business efficiency and operational point of view. Whereas if we dealt with a specific set of people who had similar circumstances, similar situations and similar challenges, our business could be a lot more streamlined. And, and possibly scalable, because you’re dispatching the Big Mac in a similar order in a similar fashion to people with similar, you know, dietary requirements or similar financial needs, as opposed to looking after a broad spectrum of people who might be at one end of starting a business and other end of starting a business or selling a business or inheriting or plant. I just think from a business operational point of view, I’d like to have a go at doing it the other way around.

Ben Nash
Look, I find we like I mentioned before that we’ve got a reasonably tight sort of two niches that we work in, which is tech professionals, and then successful SME, business owners and operators and what I’ve found that there is a benefit in your marketing, like marketing to that niche that you can talk to their problems, but I would say just as beneficial is the ability to then have everyone running on the same processes behind the scenes because all of the clients sort of look and feel the same dietary requirements as long as you put it. I think I’ll have to borrow that one. But it allows us to them when we’re training team and especially we’re going to reasonable offshore team as well with people that aren’t necessary. really deeply experienced in financial services that we know that everyone’s following the same process. Everyone’s obviously their unique snowflake and their advice ends up being different, but the process and steps and requirements are all the same. So for training, onboarding, managing, it’s, it does give a lot of the benefits on that side. It’s given its given taken because you do lose a little bit of the, you know, custom sort of bespoke feel to it to a process. But yeah, I’ve found for from a peak as we are hiring and training a lot of people that it is really helpful on that,

Darren Johns
right. And what you speak about, too, about the message, your message speaks to a certain people or certain a certain area of the market. I mean, Seth Godin says that, you know, 99% of people won’t ever hear anything about your business. And that’s plenty of people. 99% of Australians, probably you might be different, Ben, because you’ve got a very high media profile. But for the rest of us, 99% of Australians won’t know anything about a lion financial or me or whoever other advisors are. And that’s plenty.

Ben Nash
One, that’s more than enough for me. So I think you hit the nail on the head. But Jeremy, thank you so much for sharing your insights. I really appreciate it for you mentioned that you’re currently hiring for anyone that’s that’s keen to learn more about the opportunity, what’s the best way for them to find out,

Darren Johns
jump on our Facebook page, so aligned financial, on the Facebook and have a rummage around and get in touch with me the big dog and if you are keen for a bright and sunny boardshort career on Narrabeen Northern Beaches, get in touch.

Ben Nash
Nice I’m eight. All right. Well, I get around to guys I can speak to the lifestyle aspects of that walking meetings. You know, he’s he’s got it all over there. So, mate, thank you really appreciate again, sharing your insight. It’s been great.

Darren Johns
Thanks, Ben. See ya, mate.