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Hosted by Financial Advisor Coach, Ray Sclafani, "Building The Billion Dollar Business" is the ultimate podcast for financial advisors seeking to elevate their practice. Each episode features deep dives into actionable advice and exclusive interviews with top professionals in the financial services industry. Tune in to unlock your potential and build a successful, enduring financial advisory practice.
Ray Sclafani (00:00.142)
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Welcome to Building the Billion Dollar Business, the podcast where we dive deep into the strategies, insights, and stories behind the world's most successful financial advisors and introduce content and actionable ideas to fuel your growth. Together, we'll unlock the methods, tactics, and mindset shifts that set the top 1 % apart from the rest. I'm Ray Sclafani, and I'll be your host. Despite all of the activity that's occurred over the past decade,
in the mergers and acquisitions space in wealth management. If you pull aside the top investment bankers and private equity investors and ask, where are we in the cycle of consolidation, the wealth management business? They'll admit we're in the third, perhaps the fourth inning of a game of consolidation that's going to go extra innings. Despite all of that, if you survey advisors who have not yet participated in &A just yet, 67 %
report that in the next 24 to 36 months, they plan to do so. So we're on the precipice of this continued inorganic growth. However, quietly behind the scenes in boardrooms across our country, the top teams are asking the question, how are we doing on organic growth? Because organic growth is the critical and leading indicator of health for every successful enterprise in the United States. In fact,
What does organic growth do? Well, it enables you to expand capabilities, expanding your team, hiring top talent, increasing your capacity to serve clients into the future, and reinvesting in delivering even greater value to your clients over time, expanding services, being more involved and active in helping clients in new and different ways. What is organic growth? Simply put, your ability to do two things well, take existing client relationships and expand them,
Ray Sclafani (02:00.352)
serving their families in new and different ways, and making sure you're building the bridge to the heirs of your current clients. And number two, your firm's ability to bring on new clients. In the wealth management business, growth can signify various things to various teams. For some, it's about increasing wallet share. For others, it's driven by a strong market when rising AUM is the focus. And for others, it's new client acquisition.
One of the clearest indicators of a firm's true growth health is their ability to consistently and repeatably attract and onboard new client relationships. Acquiring new clients creates a repeatable, scalable growth cycle when done well. However, it's interesting to note that while this may be true, industry benchmarks show that consistently attracting new households
those teams outperform their peers in revenue, advisor productivity and enterprise value. Yet there are three data points that get my attention. The first is most firms allocate less than 2 % of revenue for new client acquisition. They allocate less than 3 % on marketing and many advisors spend less than 10 % of their time prospecting for new clients. So if your plan is to drive organic growth,
as a main component of your next growth chapter. In today's short episode, I wanna provide you six specific steps to help boost that organic growth. So let's get into it. The first thing, if you're thinking about where you're at in the cycle, by the way, if you're doing amazing on organic growth, this might be a roadmap for you to actually assess how you're doing in each of these six areas. Focus first on your current client roster. I would consider pulling apart
that client roster and stack ranking by revenue per client and ask yourself who are our loyal client advocates, the most vocal supporters and connectors, and how can we deepen relationships with those folks, you know, the clients who appreciate and value what you do, they want to be actively involved in helping your team grow. They want to bring new clients because they want their network to benefit from what your firm offers.
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You want to know the total relationship value of these client advocates. Now, we've coined these terms at ClientWise, LCAs, loyal client advocate and total relationship value, the TRV. What's the TRV? Okay, it's probably one of the most important data points for your firm. You want to look at which clients have referred over the past three years, the most number of clients your way. Take the revenue they pay you plus the revenue
of the referrals that they've sent your way who have become clients over the past three years. That combined is the total relationship value of your client advocates. You want to keep track of the TRV. You want to keep track of who they are, the frequency of time that your advisors are connecting with those folks. More about that in future episodes, but you want to make sure that your current client roster is being well served, especially your high refer sources and especially
your loyal client advocates. TRV is a good measure to do that. Number two, you want to develop specific expertise in business development. Now, not all advisors are natural rainmakers. In fact, I want to share with you three parts of the rainmaking process. And you may have different members of your team that are better at some parts than others. So first, who best hunts in the jungle?
who's really good at the external networking and who's got the network that you want to tap into. Well, that's number one. Number two, ask yourself who best hunts in the zoo, internal referrals, meeting with existing clients and finding new and different ways to serve those clients, consolidating assets held away. So those are different type of hunters. The third, which of the team members do you have
that thrive at closing and onboarding new prospective clients. Maybe they're not the best lead generator, but they're really good at once somebody identifies an opportunity and hands it over, they know exactly what to do. It takes an entire team to succeed at organic growth. So let go of the eat what you kill model of growth. It's outdated. The best teams hunt in packs and they divide responsibilities related to organic growth.
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You want to structure your team and the compensation designed accordingly, dedicating specific roles for lead gen, specific roles for lead nurturing and relationship management and solve the most important mystery of all. In fact, if there's one thing you walk away from today's episode, it's this. How do you institutionalize lead generation so you can provide a steady stream of qualified leads to the advisors in your firm?
who know how to close and win new clients and serve existing clients more effectively. We're going to write more about that in my future blog articles. And we will definitely publish more in this podcast around that topic. Okay. Number three, the marketing plan. You want to redefine your value proposition as a team, refresh it about every three years. Why? Because the capability of your people will increase.
the quality of your services will grow, you're getting smarter at what you do. So you want to align your messaging with the relevant and current exactly what it is you do. There's also emerging needs of your existing clients. You want to be aware of those and frame your firm and your team properly. Emphasize your distinctive specialties and areas of differentiation. In fact, Dan Sullivan at the Strategic Coach calls this unique ability, unique process.
Mark Hurley calls this in his white paper, Welcome to the Jungle specialization. Yeah, you can have more than a couple of specialties, but as you grow as a team, you can also grow those specialties. You want to define who you serve in the future state, you will be more specialized, all rich people will not be the target market any longer. Number four, and this one's a little nitty gritty, but I want to dig into this idea of CRM.
How are you tracking new opportunities with current clients and their heirs? Right now, if you're listening to this episode, I'll ask this important question. Can you click a button in your CRM and produce a report that outlines all outstanding opportunities to serve existing clients in the future? Who's selling a business? Who's having some liquidity event? Who's in liquidity event preparation because they're going to sell a business
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in three years time, estate planning, tax planning, are there ways that your firm can serve existing clients more completely? And can you spit out a report right now that outlines those opportunities ranked by date? What's happening in the next 90 days? What's happening between now and year end? What's happening over the next three years? Who on your team is actually looking at the calendar of the advisors in your firm?
and all the client meetings that happened in the past week. Let me give you an example. If you've got five advisors on your team, I'll just use easy math here, and everybody in the past week met with a minimum of five clients each, which would be low, but let's just use that number. That means in the past week, there were 25 client meetings that occurred. In those 25 meetings, were there any new opportunities created in your CRM system so you could track
where you can serve clients better in the future. State planning, I mentioned any liquidity event preparation, stock options, inheritances, like what's the money in motion event that's going to occur now? You may look at that data and say, well, in fact, there were zero. Well, are all your clients in distribution mode? Are you not building bridges to the next generation? Well, ask yourself this important question. So there are two reports I'm asking for. One is,
What are the new opportunities created in the past 30 days with your firm? And if you stack rank all the client meetings with all the opportunities created, are you doing a good job at that? And number two, is there a report that you and your team can produce that will outline all the future opportunities? Okay. Number five, intentional goals for new client growth. So this is a capacity question. How many new clients can your team take on in the next 12 months?
and next 36 months. How many new clients did your team on board over the last 12 months? What's working? What's not working? What is the capacity constraint or unrestraint of capacity because you've got the right hiring, training and developing strategy. So you've got an unlimited capacity out into the next three and five years. You want to build a five year forecast for new clients and revenue per client.
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grounded in your ideal client profile. You also want to use this model to design future capacity and team structure. So if you know how many new clients you're taking on, you know how much time and hours you're going to be spending with those clients on the onboarding, which is always more upfront, the ongoing servicing, the building, the expanded relationship with those clients, the frequency with which you'll be meeting with those clients.
Well, that gives you a whole forecast for what your capacity strength is going to be. It's a math equation. It's not complicated. It's about time and it's about number of people and the hours available to serve existing clients and take on new clients. If you're not building a capacity model and setting the right goals for new client acquisition growth, well, you're going to find that your team's going to get burnt out. You might lose a few clients along the way.
People will be stressed and if you're in step down mode where you're doing some kind of step down challenge and you're thinking about continuity planning and succession planning, that only puts more strain on the team, which elevates the importance of building solid new client acquisition growth goals and an expansion in terms of the capacity that your team has to serve clients. That's integrity. That's integrist growth. Okay. And that leads me to number six.
reframe your culture around growth. We all know that firms that have teams that are enthusiastic about growth, and they're wanting to reinvest in the future to expand the capacity and the capability of the firm. Well, that kind of growth mentality and growth culture signifies an increase in value, both for the client, for the team and for the firm. You want to make client acquisition part of your team culture.
It should be celebrating successes and sharing effective strategies with one another. In fact, the best teams are those that take the case studies and dig deep into the impact that they're having and discussing that as a group. That enhances the culture of your firm. In an episode that I published and dropped in December, late December of 2025, I talked about bringing your team along.
Ray Sclafani (13:53.44)
Some people think of expanding the client roster is just more work, while other people get enthusiastic about the culture related to the impact, the purpose of why we're in business to do what we do. Here's the bottom line. If your firm's future depends upon continued growth, and it does, by the way, then the ability to attract new clients, that's no longer optional. It's essential. And it's that leading indicator.
Firms that take seriously these six steps that I outlined in today's short episode are the ones creating a self-sustaining and scalable growth cycle. The opportunity is present. The marketplace and wealth business in the US making up half of the global wealth business and the wealth money in motion. Last year at $4 trillion globally, in the US, $2 trillion of the $4 trillion. We are sitting at the
precipice of great expansion in the wealth advising business. At the same moment in time, we've got 57,000 advisors exiting the business. The demand for advice has never been better. And if you're a controlling owner or founder, and you're developing your next generation leaders, what a great opportunity to talk about growth as as abundant here in the US wealth business. So with each episode, I introduce a few coaching questions. And today there are four.
I hope these questions help you reflect on today's episode and on your organic growth playbook. The first is what step in your client acquisition process, new client acquisition process requires the most attention right now and why. Number two, who on your team consistently contributes to growth and how can you be better aligning roles and responsibilities with their strengths? Number three, what's the one change you would want to implement?
in your marketing or messaging that would resonate more with next generation clients? And number four, how might you better define and measure organic growth in ways that reflect the future you want to build for your firm? That five year forecast of growth and the institutionalization of lead generation that takes the burden off of any one individual to generate new business. Thanks for listening and please share this episode with a friend.
Ray Sclafani (16:13.998)
Well, thanks for tuning in. And that's a wrap. Until next time, this is Ray Sclafani. Keep building, growing and striving for greatness. Together, we'll redefine what's possible in the world of wealth management. Be sure to check back for our latest episode and article.