Challenges v rewards of expanding to multi-adviser firm

Speaking on the ifa podcast recently, Eugene Ardino, CEO of Lifespan Planning, said transitioning from a solo practitioner to a multi-adviser involves moving from being primarily an advice provider to taking on the role of a business manager, which requires an entirely new skill set.

“You go into your financial planning degree, and you probably spend limited time talking about actually running a business,” he said.

While qualifications focus on delivering quality advice, they often leave practitioners unprepared for the realities of managing a team, running a business, and tackling HR challenges.

Ardino emphasised that moving from a single-adviser practice to a multi-adviser firm means stepping into a business management role, with all the associated pressures.

“You go from being predominantly a practitioner, someone who gives advice, to still being a practitioner in most cases, but also having to run a business, manage staff, manage other professionals, effectively managing your peers, which ... is more difficult,” he said.

The dynamics shift when you’re responsible for the performance of others, particularly those directly contributing to the firm’s revenue.

Financially, the challenges are also significant.

“You’ve got to make sure you’ve got a viable and realistic business plan,” Ardino said. Whether hiring additional advisers or acquiring other firms, the costs can be steep, and profitability may take a hit in the short term.

Ardino advised against going it alone.

“Doing a bit of education yourself, even if it’s some shorter courses on business management ... is a really good idea,” he said.

He also suggested seeking help from consultants or firms that specialise in business operations for advisers: “There are all kinds of issues that pop up”.

“Get some help ... unless you’ve done it before, because there are many layers of complications there and it’s very different to being a practitioner.”

Ultimately, Ardino highlighted that transitioning to a multi-adviser firm isn’t just about business growth – it’s about mindset. Advisers must carefully consider if they’re ready for the demands of entrepreneurship and business management, he said.

To hear more from Ardino, click here.