Great advice from founder Stuart Wemyss.
Referrals are business gold, but asking for them is not easy.
Someone who’s very successful at this, and many other aspects of business leadership, is Chartered Accountant and ProSolution Private Clients Founder and Director Stuart Wemyss.
A regular contributor for The Australian newspaper (wealth section), Stuart and his team run a Melbourne independent wealth advisory firm. This year, Stuart wrote Investopoly, a book on winning the wealth game by applying some of the rules of Monopoly – such as buying as much property as possible, and not spending all your cash (having some savings).
Here, Stuart talks about his book, great business advice gleaned at The Growth Faculty events, and the “man crush” he has on Seth Godin.
Stuart, referrals are a large part of your business, how do you go about asking for them?
Never ask before you earn a referral. If you focus on earning the referral (through building trust, a relationship, adding value and so on), then you rarely have to ask. Most people that want to ask for referrals typically haven’t yet done the hard work to earn them.
That said, the best advice I have received (from Dan Solin) is to just put the topic of referrals on the table and ask the client how they’d like to deal with it. You say something like: “You know about 80% of our new clients come to us by referral. There’s a lot of trust involved in what we do so it makes sense. I just wanted to bring this up and ask how you would like to deal with the topic of referrals? Some people never feel comfortable making referrals under any circumstances - and that’s fine. Whereas some people are happy to refer, want to know how and appreciate friendly reminders. Are you happy to discuss this? I don’t want to put you on the spot.” I think it’s a really nice way of doing it because it puts the client in control.
What are some achievements you're most proud of?
We have stuck to our core values and never strayed from them. This was made easier by the fact that about 10 years ago we did the core values discovery exercise outlined by (global leadership expert) Jim Collins. This has given as a clear set of principles that have governed all decision-making and behaviour. Arguably, our most important core value is to put our client’s best interest first. So, we have always staunchly protected our independence - almost always at the sacrifice of short-term profit. I am really proud that we have always stuck to our guns. We are very proud of the work we do for clients.
What makes you different to other wealth advisory groups?
The biggest thing is that we are completely asset-class agnostic. That is, we have equal experience and knowledge with investing in property and shares. We don’t favour or prefer either. And because we don’t receive any investment-related revenue, we don’t have any commercial incentive to favour one over the other. Unfortunately, this is very rare in Australia. Even many truly independent financial advisors don’t have a very robust understanding of direct property investment (don’t understand the nuances) and have even less experience. It’s like playing a round of golf with half a set of clubs – you need the full set to do it properly.
What’s been something you’ve implemented in your business in recent years that’s made a big difference?
Coaching. I coach two staff members each fortnight. It’s one of those things that is important but not urgent so it’s easy to avoid doing it. It takes discipline, but I think it helps both of us. It’s an opportunity for me to take some time out and reflect on our priorities. And it’s an opportunity for the staff member to tap into my experiences.
What are the most important behaviours in a leader that best improve culture?
Lead by example – especially when it’s tough to do so. It can never be a case of “do what I say, not as I do”. No one is bigger than the business’ values and culture.
Do you have mentors/advisors?
I have a mentor that I meet with periodically. He’s in his mid-70’s and he has built a large and successful financial services business over the past 50 years. In my opinion, there is no substitute for experience. I get a lot out of our conversations.
And I would count Seth Godin is as bit of a mentor too. I have been reading his daily blogs for about 10 years now and they have helped me tremendously. People in my team joke that I have a man-crush.
You have attended events hosted by The Growth Faculty, can you share a couple of takeaways that helped you lead your team?
Over the past 15 years, I have attended heaps of The Growth Faculty events. Some of the highlights include Verne Harnish, Jack Daly, Jim Collins, Marshall Goldsmith, Malcolm Gladwell, Liz Wiseman and Simon Sinek.
I think Liz Wiseman’s thesis of soliciting your team’s best thinking through asking questions was a really good lesson. And it works with clients too – under the guise of “you can't learn anything when you're talking”.
Jim Collins’s ‘fire bullets and then cannonballs’ was a good lesson too. This premise is that you test any proposed changes to products, pricing, structure, etc. in a small way and if it works, you go hard.
You’ve written Investopoly, why did you write the book and who’s it for?
There’re lots of books about shares. There’re also plenty of books about property investing. But there wasn’t a book that tied it all together. One written for people with some money to invest. The Barefoot Investor book has done very well but is aimed at the masses. I wanted to write a Barefoot Investor type book that was aimed at higher income earners. People who have some cash flow to invest but just don’t know where to start. They don’t know if they should invest in property, shares or contribute more into super. The book outlines 8 golden rules that are easy to understand, that will guide people to answering their questions.
What are four key points from the book you’d like to get across?
Firstly, building wealth is simple. It’s not complicated. Lots of people make it more complicated than it needs to be – mainly as a sales technique. Any investment or strategy should be able to be explained using simple logic.
Secondly, play the long game. Think long term. Don’t worry about all the short-term noise in the marketplace as it will distract you from making the right decision.
Thirdly, use evidenced-based strategies. If there’s no evidence that a strategy or investment will work, don’t do it. There’s no need to take that risk.
Lastly, seek advice. Knowledge is valuable. But experience (wisdom) tells us how to apply the knowledge and arguably that’s more valuable. Through getting advice from an experienced (and independent) person you get to learn from other people’s mistakes – rather than make costly mistakes yourself.
Is there shame amongst business owner/executives who run a great business but struggle financially in their personal finances?
It’s a risk when people are so focused on maintaining and building their businesses that they don’t build personal wealth.
The trick is to shave a bit of profit off the top each and every year to fund a long-term investment strategy. And the best time to start doing that is now. Most low-risk investment strategies need time to work. Therefore, it’s difficult to make up for missed time from an investment perspective (you can but you have to take on more risk).
In the main, profit margins rarely get fatter. They almost always contract over time. Therefore, arguably you are in your best position today to start investing. Prioritise it and it will get done.
If you don’t, you might wake up one day when your industry/business is in decline and find out that you have nothing to sell and nothing to show for all your years of hard work.
Can you share a story of someone who’s turned their life around, and how they did it?
I met some clients in 2003 when they had just had a failed business and lost almost everything. They had little assets and a poor credit history. However, I worked with them and help them build a very healthy property portfolio. Earlier this year I formulated a strategy that allowed them to retire over the next 2 years, allowing them to travel and spread their time between staying in Sydney and their farm (2 hours from Sydney). I’m certainly not taking credit for this outcome but its very rewarding and enjoyable to see they have a comfortable retirement to look forward too.
What’s your sense of where the economy is headed in 2019?
Fundamentally, I think the economy is, and will continue to be, quite healthy. However, I think consumer sentiment will probably be patchy. This is partly because of the soft property market – it tends to impact consumer confidence and because of political uncertainty (election in May 2019). I think consumers will delay making any big decisions until after the election.
What’s a recommended book? Jim Collins’ Good to Great is a classic.
If you co-author a book with anyone, who would it be, and what’s its title? Seth Godin and anything he wanted!
A great piece of advice you could share? Play the long game – i.e. focus on long term value and understand that sometimes it comes at the sacrifice of short-term profit – do the “long work” as Seth Godin would say.
I think this applies to many facets in life:
Relationships – an extra hour at work might get a bit more done, generate a little extra profit, but if you do it consistently you send a clear message about your priorities to your partner. In the long run, the incremental profit is worthless, but a healthy relationship is everything.
Investing – the best financial decisions are almost always long dated ones. Because thinking short term almost always means your decision will be influenced by either fear or greed.
Personal – the tension between relaxing versus going out and doing some exercise. Or the decision to abide by a set of moral and value codes in order to build a reputation even though it might cost some money in the short term.
What’s been your lowest moment, and how did you recover from it? Business wise, it was about four years ago. I launched an online course and only sold two. It was very bad timing as I was going through a marital separation and was already a bit fragile. It was like ‘the straw that broke the camel’s back’. I was so disappointed in myself. Refer to my answer under “What’s the secret of success?” in regard to how I recovered.
How do you relax? Enjoying consuming good food and alcohol with my wife.
What’s something about you we don’t know? Between school and university, I joined the Army. It was fun and taught me how to be self-disciplined.
What’s the secret of success? Do your best work and don’t attach your happiness to the outcomes that work may or may not produce.
What’s a prediction for 2025? A lot of prosperity. I think Australia is in such a strong position geographically/location wise (close to some major economies - China, India and Japan), population growth wise, natural resource wise, tourism wise… we really have a lot to be very optimistic about.
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Christine Kininmonth is a journalist and former panellist on ABC TV’s The New Inventors. An avid reader, Christine believes reading is essential to business success. She presents The Growth Faculty’s Business Book Club each week.