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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.
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. Let's talk about one of the most
underdeveloped skills in financial advisory practices, something we don't think about often, but the ability to choose your clients smartly. When you're building a billion dollar business, not every client is a good fit. And when you shift your mindset from being just an advisor looking to accumulate as many clients as quickly as possible to being a CEO or the leader of or controlling owner or owner in a business,
that is focused on growing the enterprise value, the share value of the firm, you quickly realize something critical, that enterprise value is built on predictable cashflow. So if predictable cashflow is your North Star, the next logical question is, how do you know which clients will deliver that? The easy answer, well, it's your A plus clients of today. They already have meaningful assets, their fees are strong.
their loyalty is proven and they value your advice and they're likely referring others your way. But the most important and strategic question is this, how do you know which new clients will become your best future clients? Because not everyone walks in with $10 million of investable assets in a warm introduction. Some walk in with a paycheck, a 401k and a list of financial questions.
Ray Sclafani (01:55.96)
So how do you discern which of these prospective clients are worth betting on? Let me share a framework with you that I've learned from others, the advisors we coach in our Business Builders Academy. I believe every advisory team should be mastering some framework that works for them. Here's maybe a way to start thinking about it. Start by looking for indicators of future value. This means identifying clients who are advice receptive.
They aren't just looking for a transaction. They're open to guidance and coaching and planning. The second is they're willing to pay for the planning and the advice. Even before transferring assets, they see the value in your thinking and they'll pay a fee to get a plan in place. They're savers. They have a surplus mindset. They're consistently saving. They're not living at the edge of their means. They're high income earners or
upwardly mobile. Maybe they don't have the assets today, but they have strong earnings potential and equity comp. They're future wealthy. Your values are aligned. They're kind, respectful, trusted, the process that you put them through. They're not fee fighters or micromanagers. They're actually relational and not transactional. And they're ambitious. They want to do well for their families and they seek out and are curious about learning.
and take action and execute and implement the advice that you're providing. They're not just good people. These people are good bets. And in this business, learning to place the right bets is everything. One of my favorite coaching questions to ask every advisory team is this, how are you training your team to know who to bet on? It's easy for the senior advisor to make the call.
But what about the associate advisors, your planners, your relationship managers? Do they know how to spot a future high value client? Or are they just simply looking for someone who has assets today? If you're serious about building enterprise value, you need a client selection strategy that goes beyond the balance sheet. You need a playbook and that playbook might include a formal intake scorecard that scores new prospective clients.
Ray Sclafani (04:15.328)
on both financial and behavioral indicators, the leading indicators of the future. A pathway for fee based on boarding where advice is compensated even before any asset transfer. Training your team to listen for life events that signal future complexity like a business sale, inheritance, equity vesting, marriage, divorce, et cetera. Role playing conversations around fee resistance and framing the value
of advice and a firm wide agreement on who we're built to serve and who we will politely refer elsewhere. Because here's the thing, when you get clear on who your business is best built to serve for the future, everything gets easier. Your marketing gets sharper, your referrals get better, your client experience gets more consistent, and most importantly, your future cash flows become even more predictable. And that predictable cash flow
is the foundation of enterprise value. So if you want to build a firm that lasts, don't just accept every client that walks through the door. Be intentional. Train your team to choose clients like a CEO, not just an advisor. Support the next generation advisors by helping them determine how to make the right bets on those future clients who are going to be real successful in aligning with where your company is headed.
Let me leave you with a few questions to take back to your next leadership meeting. With each episode, we provide a few of these coaching questions and I hope you find these valuable. Today, there are five. Number one, what behavioral and or financial traits define your best clients, both now and in the future? Two, do you have a shared definition of an ideal client or is it still pretty subjective? Number three, how are you training your team
and your loyal client advocates to identify what I call advice first clients early on in the relationship. Do you have a clear process for onboarding great future clients, even if their assets under management today are relatively low compared to your A plus clients of today? And fifth, what would you change in your growth strategy?
Ray Sclafani (06:37.536)
if you only took on clients who made you more valuable as a firm five years from now. Choosing clients wisely is not about being exclusive, it's about being strategic. And when you choose right, your future enterprise value will thank you. 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.