#307 Josh Pennell – Transcript

Ben Nash
Hey guys, Ben Nash from the XY advisor team. And today I’m pumped to be here with Josh Pennell. Josh is an advisor and director at prosper advisory based down in sunny Victoria. keen to pick Josh’s brain on the growth, his business as well as some of the stuff that he’s been doing around client engagement over the last little bit. So Josh, thanks for joining us, mate.

Josh Pennell
Thanks, Ben. And mate, don’t start out by picking on Melbourne’s where the winter is starting. And this is when Melbourne start getting really angry at you northerners. So just be nice to us. All right.

Ben Nash
Well, you guys have had a good run over the last little bit, but the tides at the time. That’s it. Man, I thought a good place to start would be can you just run us through sort of the what your business looks like? You know, the sorts of people you work with client numbers, team, etc?

Josh Pennell
Yeah, sure. Well, just a quick snapshot of the really long term background, the business has been going in different forms for about 80 years. And at its peak in size was a two office, six partner, roughly 60 staff business. But the current structure the business having broken those two offices into separate companies around about 15 years ago, and I bought half the business 10 years ago, is the Melbourne office 30 people in total, two owners, and we have accounting and financial planning divisions. Myself, my business partner own the whole business together, but day to day, we predominantly work on one side, each the accounting for my business partner, and then financial planning for myself. And probably around half our clients use both services of accounting and financial planning, which, which works really well. So in a nutshell, that’s us now.

Ben Nash
And what sort of clients you’re working with, and what are you doing for them?

Josh Pennell
Yeah, so we’ve probably still got about a third of our clients, who were her retirees, and that comes mainly from effect of that long term history of the business. And, you know, some of the the clients that were there when I joined, but in terms of new clients were bringing in, we do still see a few pre and pre and post retirees coming into the business. But from a more proactive marketing perspective, we’re mainly working with busy professional families. So they’re usually aged in their 40s Young ish kids, white collar, high incomes, and or they own a business of their own. And then also, about five years ago, I went through a separation and divorce, and through that lens a lot about the family law field, and therefore we also do quite a lot of work with divorcees as well.

Ben Nash
Interesting, I’ve was having a bit of stuff on your website and check that out. And I think it’s a great approach to, I suppose, you know, when people are going through that, obviously, it’s a pretty tricky time. But for them to know that you’ve got that, that experience there. It sounds like the from the time that you joined the business that you’ve you’ve sort of pivoted the the client focus. Tell me, how did you go about tackling that in terms of you know, who you wanted to target? Why and then, and then what you needed to do to, I suppose, behind the scenes to create something that’s compelling for that market? Yeah,

Josh Pennell
well, I think like a lot of us, because of where the money often sits with superannuation and retirees often that is a space that makes sense for a lot of people to be operating in. And that was certainly a lot of the types of clients I’d worked with throughout my career in, in all my roles. But I just sort of felt that after probably, say, 1213 years in the industry, it was maybe getting a little bit repetitive in terms of working with the same client all the time and, and focusing on the same advice, issues and needs of those retirees. So for me, it was a little bit about finding something that reinvigorated me, and it was also a bit more authentic to where I’m at in life. So I’m 40 this year, as I mentioned, been through a divorce and my partner and I’ve got four kids. So for me, it was more about working with other people that I relate to and they relate to me and that’s what led to kind of that that evolution of who we’re marketing to and and how we’re doing that so that it’s a good match for the client and also is in working with them?

Ben Nash
And how did you go about actually building out the service solution? I know that you’ve been through the KPI program, which I’ve also done as well. It sounds like essentially the shift started happening before you engaged in that, though, like in terms of what you do, because obviously, it’s a little bit different in terms of the what is front of mind for a pre and post retiree client versus what’s front of mind for a 35 year old accumulator, or 40 year old person who’s going through a through a separation? Yeah, how did you actually tackle that?

Josh Pennell
Yeah, so the initial iteration, probably about six years ago was something called the Young Millionaire’s club. And that was an offering to young, high high income earners. Maybe they haven’t started a family yet. But they were sort of say around age 30. They were now progressing their careers, maybe earning two to three times where they were when they first left university, but perhaps weren’t actually putting that resource to good use. And I was essentially at a stage where probably a fair few of my friends filled in that boat, and I was just, rather than it being like, Oh, they’re my mates, I don’t care. It’s not in, it’s not my place. It was kind of starting to annoy me, because I knew that power of time and compounding the things that these people could be doing with these great incomes. So I didn’t then go and approach all my friends to become clients. But I did build an offering that fitted that demographic. And first, that was the first protocol. And that went quite well. And we did definitely bring on a lot of clients with that. But what I started realizing was that it was probably about 10 years too young, where we were targeting, for it to be a more commercial offering in terms of, we’re dealing with a lot of people that hadn’t received advice. Some of the motivations to continue getting advice, such as kids and mortgages and greater responsibility weren’t quite in their life just yet. And so whilst it is still a great service of people, I know there are a lot of people out there who who focus on that demographic, what, especially more so these days, I then evolved into something that’s now called fulfilled family wealth. And that more came out of the KPI program, where I started thinking more about the clients that were having greater needs and reasons for advice. Therefore, we were able to do more for them add more value. And also it was a lot easier to get them engaged and on board, because they were really at a stage at, you know, at age 40 instead of 30. And having a mortgage and maybe a business and again, at an even higher income and the kids and the private school fees, and this and that where they were just actually really crying out for advice. So they were on the front foot a lot more. And it also feel a lot more we were we’re always now late in life with with young kids and running my business for quite a while by then the life experience of a divorce. I also had a startup business in a separate field that I learned a lot from so yeah, just evolved it to fit those various benefits that I mentioned.

Ben Nash
Yeah, nice. Yeah, it’s similar, I suppose to a little bit to to my journey of pivot that when I started the business, it was attracting younger clients. And I think our message still does speak to people in their earliest stage. But also like what we realize and especially as like, all of the behind the scenes stuff has increased so drastically in advice over the last few years, it’s like you want to have a solution where you’ve got clients that you can add a lot of value quickly, and then you can take you can charge extra fees to spend the extra time to get the best results for them as well. I think, thankfully, I think tech is making it a bit easier that, you know, creates an ability to leverage just to serve as different other markets. But I think for that full shebang, FP stuff that the more the more you got going on it, the easier it is, especially when you focus on having a really robust solution. Definitely. Joshua, chatting a little bit offline over the last little bit and you’re talking that around the fact that you have been heavily focused around your client engagement process over the last little while. Can you tell us about how that came about? You know, how you tackled it and what some of the outcomes were there?

Josh Pennell
Yes, so the first part of it was through the KPI course, where for those who haven’t heard this course If you Google key person of influence or dance, then you check it out, definitely, of course, I got a lot of value out of. And some of the good things I teach you in that course are around how you’re pitching to your ideal client, and what tools and products you’re using in order to do that. And two of the most valuable ones that I got from doing a course was a brochure that we put together through the course, that really forces you to articulate your client target, and how you help them and, and why and how you add value to them. And then also, one page snapshots of what you processes that wordy but that are quite graphical. And also your specific method for providing advice. So what is it? What is your unique proposition that sets you apart from other advisors in how you go about it, and we had to create or create all that from scratch, which led to some, some nights of me tossing and turning in bed trying to come up with these solutions of I’ve got to get this done for this course. And I’ve just got nothing like where am I going with this. But like a lot of things, eventually a light bulb goes off when you just muck around with it enough times and get your pan pan out and start scribbling out ideas. So that helps me come up with that fulfilled family wealth offering and be really clear on who it was for what we did for them. Where they would start from when they come to us and what their common issues and headaches and stresses and pain points were, what their common goals and needs were from an advice perspective, and be able to really paint a clearer picture of why we are the solution for them. And for me, it was very easy, because it’s very easy to be authentic, when you are pretty much an identical mirror image of the client, you’re trying to attract, attract. So as I said, I can say I’ve got kids, I can say, I run a business, I can say I’ve been investing since I was age 15. I understand the good and bad and the opportunities and sometimes stresses that come with that when markets are up and down and things like that. So it wasn’t difficult to paint a picture for those clients about why we were a great solution for them. So that’s where a lot of it started from, and then having those tools available for our existing clients. And if we want to hold a webinar or an event or onboard a new client, they’re they’re really valuable ways for us to kind of get that early comfort with a prospect who otherwise might not know us at all.

Ben Nash
Yeah, nice. And what would the what do you think we were the areas that it positively impact the most on society different way? Like, what were the things that were not working as well, before you put this in place that are working better now?

Josh Pennell
Yeah, so first thing was getting clear on who it was we were targeting, then it was coming out with some of the collateral that resonates with that and is attractive to them. So you know, using actual marketing experts and proper designers and investing in the time and money to get the quality marketing materials. We also built something like as client survey kind of scorecard tool, which we also now send to all our prospects before they meet with us. And that’s got some thought provoking questions, and they receive a personalized results report of how they’re tracking. And I think that, you know, the questions are deliberately leading, so to speak, to help people see, oh, gee, I hadn’t actually thought about that, or I haven’t dealt with that. But I have done that. So so like, Okay, you’re doing well in these areas, you’re not doing well in those areas. So it starts starts to become clear to them, the areas to focus on and the value that can be added and the fact that they don’t actually have anything in a row. And I do need to work on some, some key areas. So that’s been helpful. So another thing we did was spent the time getting a lot of Google reviews from existing clients. So these days, I know that I certainly Google, any service provider I’m going to use. So the social proof element has been, I think, quite powerful in people being able to see that and do their research on us in the background. So I feel like by the time the client gets to the first meeting now they’re already a lot more along the process and journey and quite a lot more comfortable with who we are what we’re about. And the fact that we are probably a great solution for them. So the number of things stopping them from proceeding are already a lot less. In addition to that, when I first started in the industry or sort of the old school, have a first meeting, sit there and fill out the fact finding paper wasn’t necessarily the best do it, but at least you were gathering a lot of the information you needed. A few years ago, we went away from that, because we were concerned that it wasn’t conversational enough and wasn’t engaging enough for the client. We wanted, didn’t want it to feel too structured and rigid. But one of the downsides to that was it did probably take our focus off making sure we made it a efficient and well structured process for the client to be able to have everything they needed, say everything they need to tell us and be in a position to make a decision about whether they were comfortable to work with us. So a few months ago, I sat down and bit the bullet and knew it was going to be a bit of a tough process and just spent a lot of time completely restructuring our initial engagement process. And I also took a step back, so to speak, to hopefully take some steps forward, and I took the prospecting meetings back off the team and started doing them again, myself, I was doing some steel, but in many cases, I was finding opportunities and then passing them directly to the team. So I just wanted to get back in there myself and see the potential different things that weren’t getting us the level of conversion I thought we should be getting. And the main changes I made was cut our initial client process down from three meetings to one, making sure that we are sending them things like our brochure, the scorecard tool. And other information, like the fact I’ve written a book, I haven’t finished it yet, but just mentioning that trying to build up our profile in their mind of being seen as the expert, before they even come to the meeting. also introduced a pre first meeting, screening phone call just a five to 10 minute Hi, hey, going, where you’re at what do you need, so that if we or they don’t feel it’s a good fit, then we don’t actually progress to that longer. First meeting, just saves everyone a lot of time and, and headaches. And also that helps that initial bit of relationship building as well. And what I do now, as well, as before, once the first meeting is booked in, and I’ve already seen all these other items I mentioned, all I asked them for is a high level summary of their current financial position. And their key goals. And the way I communicate that is tell me what you want, when and how much it’s going to cost. And I deliberately make sure that no, it doesn’t need to be in the nth degree of detail. And I then plug that information into an otherwise predominantly templated presentation for the first meeting.

The first meeting then covers why we are the providers to people like them. So an explanation that we are like you, we understand you URL why, you know, Simon Sinek style of why do you do what you do? Then I show photo of me and my family really getting that, you know, making them really genuinely say, Okay, this guy’s the guy for us, because He is us sort of thing. So that that’s where I start, but it’s just a very brief thing, because you want to make sure the first meeting is as much about the client, not you as possible. And then I go into the Alright, you’ve sent me these, this information about your current situation and your goals. And I spend as much time on as the client needs. And I I asked the same questions, sometimes two or three times just to make sure that absolutely everything they’ve got to tell me and want to tell me is is out on the table about what they’re looking for. And then I spend around about 15 minutes, explaining to them the value of advice, our approach to advice and using the unique method we have developed using the one page process. Document we’ve developed so they know what to expect they know what’s coming. I’ll show them an example of a financial plan. I’ll show them an example of investment research and projections and that the way we put together portfolios and basically take it away from selling a service to selling a tangible thing that they can see and visualize so sort of show not just tell if you’re buying a car, you can physically touch C drive. You know, understand what you’re buying. But whenever we’re buying us service, we can’t see it. So as much as possible, I help them see what financial planning is, as you know, what’s the end products so to speak, they’re going to actually receive. I explained what to expect, I give them a bit of motivation around why it’s important to act sooner rather than later. So actually try and get a bit of urgency happening with them. Because we do all know that the cost of not prioritizing and managing your money well for as long as possible, just purely the time and compounding considerations and lost opportunities. So you want what you want people to actually start on this stuff sooner rather than later. And I use the example myself of investing from 15. And now nearly 40 seen the power that that has had, for me, I clearly outline all the costs, what what is going to cost, how they pay what it looks like, and basically get them to a point in roughly 45 minutes, where they’ve felt that they’ve been really clear on what they want and need. I’ve been really clear on why we are a good solution for them, what the process will look like and what it will cost. And it’s just meant that in one meeting instead of three, we’re getting a much higher conversion. And thankfully, it’s been 100% conversion. And usually, we would book a meeting for a week later, some people might have heard of band fan, which is booked a meeting from a meeting. Make sure you you’re continuing the process. And even if you end up getting a no from the client, at least you’ve got that now and you can move on. And they can move on and you’re not chasing and wondering what’s happening. So yeah, we booked that meeting for a week in advance. But what we’re finding is, in most cases, we’re getting an email from the client the next day saying, we don’t need that next meeting where we’ve chatted about it overnight, and we’re good to go. We’re happy to go ahead. So that’s, yeah, in a nutshell, how we’re approaching it. And we’re seeing it’s working really well.

Ben Nash
I think that that thing on saving time and getting to an efficient answer is is super important. Because as you say, your clients are busy, you guys are busy, I think that you need to recognize especially when you’ve got a specific sort of solution that you want to deliver or group of people that you want to work with that. It’s okay when someone says no, or if they’re not the right fit. And I think you need to it’s out, it’s on us to really give them the information to make that decision. And ideally make the decision with as minimal time commitment from them and from us as as possible. So I think, yeah, I think it’s similar to what we do were, you know, trying to share with them things before the meetings, we even tell them go, like go through our services and things ahead of time so that people know, and if they, you know, they we try to show them the value, which is difficult to get across in content or a video without having the conversation. But some people just aren’t prepared to pay, you know, a certain amount of money for a financial advisor. So that’s okay. Like, that’s obviously on them. We’re obviously we’re completely biased. And we think it’s worth, you know, 10 times what we charge and our clients feel that once it gets to the other side, but if they’re not, then it’s not like you were saying like, you don’t want to waste an hour of their time or two or three hours of their time to get to that point. It’s like give them enough to go. Okay, well, yeah, I think it’s worth continuing the conversation on No, actually this. This isn’t for me, and I think some advisors I think are a little bit fearful of that. You know, not not pushing back on people if it doesn’t seem like they’re all in or exactly match. But I think ultimately, yeah, like you do you do interview saving them time and doing them service and saving yourself time and in the process? Yeah, well,

Josh Pennell
yeah, there’s no, there’s no doubt it works much better for everyone in the way we’re doing it now. And, yeah, if they want to work with us, great. If they don’t, yeah, unfortunately, not going to win every single one. Is it cost is it, they don’t like you is it whatever, it doesn’t really matter. Just try and find as many that are a good fit as possible. And as I said, thankfully, so far, where we’re going 100% Very small sample size, only six done, since I’ve changed the process, but noticing a significant impact already. And we’ve got four or five more coming up soon. And then then the evolution of that will be I’m getting team members in those meetings. I’m running them but the team members are there seeing it and learning it. So in time I will be able to get them back involved with with doing it themselves and hopefully continue to get the same results. When we’ve got trying to do it in a more scalable Why as well?

Ben Nash
Totally, I think that’s the key, especially with what I think with all aspects of business. But with prospecting and conversion, and that like a new client engagement process, it’s we’re and we’ve worked on ours, and we’re still working on ours now. But we’ve had a couple of beads, like focus pushes in the past, and it’s like, you can see every element of the stage, then it’s easy enough to go, Okay, well, what can we do? What can we change, sometimes it does mean as you say, you step back in, get, get your hands dirty to do some of the stuff, get that feedback from the frontline, change some things, see what it means get it back to where you’re comfortable with, then you can go back to trying to scale again, and I think it’s like this ongoing, you know, on ongoing iteration process, which you need to do, because what people want is changing what’s going on? What’s front of mind for people is always changing as well. So I think it’s necessary that it’s what you’re doing changes with it as well. Yeah, for sure. Yeah. But yeah, obviously. Great to see those those outcomes as well. Tell me, Josh, and I could I love talking about like engagement and conversions. I couldn’t talk about this all day. But I know, I won’t. What What would you do differently? If you could go back? If you could, if you could go back to like, you know, you kicking off the business 10 years ago? What are the what are the main things that you would that you would change if you had your time again?

Josh Pennell
Jeez, great question. Well, just to just to reconfirm I bought half of an existing business. So that’s one key thing there, that’s probably a bit different to starting a business will think I feel like I’ve probably pretty happy overall with, with how I’ve approached it all, in the sense that I’ve evolved my role a few times. So when I first bought the business, I was completely focused on meeting all the clients we already had, and being their advisor, I then went through a process of transitioning and jority of the clients to new advisors. So that did allow me to evolve my role and be more of a business owner slash advisor, rather than purely a technician. Obviously, it’s pretty hard to grow your business, if you’re already full up with, with the clients you’re working on. I’d say overall, I’m happy with how that’s been done. And now we’re in a position to try and kind of level up and scale it more now that we’ve got other senior people with the capability to work with clients. And our main challenges now are probably efficiencies around how we do things. So the efficiency to actually then get the advice produced and, and those sorts of things and making sure we’re using the technology wherever possible, effectively, it also in the back end of all the number crunching and comparisons and compliance that we need to be covering off. I think that’s probably our biggest opportunity. We have just confirmed an outsource paraplanning solution, which is a bit of a shift in mindset for our business. It’s always had that internally resourced. So yeah, certainly, I’m not sitting here saying we’ve done everything perfectly. And I’m really happy with arrow and he’s gone. But I think that the reality is that it does just take time to evolve a business and grow a business, especially in the industry, we’re in with, with so much of our time, taken up in recent years around regulatory change. So yeah, I wouldn’t say I’d necessarily done anything to differently, but I would, it would have been nice if things had just been able to move a bit faster than the nature of

Ben Nash
it’s always the way and I think it sort of talks to that that see soaring the ego, like you focus on you focus on your marketing, sales conversion, then you’re like, Okay, now we need to do efficiency, then you got some team building there. And it’s like, for small businesses, it’d be great to do them all at the same time and cohesively but the reality is that it just doesn’t, it just doesn’t work like that. So right ego foundations, learn the lesson, see what’s not working, and then that becomes the things that you focus on to to get to that to the next stage. Yeah. Thank you so much for sharing your insights. Really appreciate that. I know you were just chatting a little bit offline and that you currently you are hiring for at least one role in your business. Do you want to give us your pitch for this for people that might be listening?

Josh Pennell
Thanks, Matt. Yeah, hopefully there’s some good sort of client service administration people waiting around looking for a role so we are looking to fill that role. We had someone in that role who’s been progressing through our business over four years through her on the job experience and also further studies so she’s moving up and into new things and looking to fill that role. So anyone looking for a role like that in Melbourne, we’d love to chat to

Ben Nash
what’s the best way for people to reach out Josh.

Josh Pennell
So our businesses prosper advisor, three and my email is Josh p at prosper advisory.com Today

Ben Nash
you also may well guys check check that out, Josh, thank you again for sharing your story mate. Really appreciate it.

Josh Pennell
Thanks so spent thanks for having me on it.