We all know it takes many years and plenty of gray hairs to build a great financial advisory practice, right?
Maybe not. If you do it correctly, you can build a successful business much faster than you may have ever thought possible.

Research by my firm, CEG Worldwide, has found a select group of advisors who are green in terms of experience, but are generating great success in their businesses.

These up-and-comers aren’t simply stumbling into success. They are taking steps that allow them to leapfrog their competitors and stay on track for even greater results in the future. Whether you’re new to the business or a veteran, these successful newcomers have plenty to teach you about how to make this your best year ever.


We surveyed more than 2,100 advisors and found they fell into four categories:
Newbies: These advisors have practiced for fewer than five years and manage less than $50 million in assets. They represented 23.2% of the group.

Rank and File: These industry veterans (31.9% of the group) have practiced for at least five years but have not reached the $50 million mark in AUM.

Elite: These advisors (39.9% of the group) are well-established in their practices, with at least five years under their belts, and are managing a minimum of $50 million in assets.

Rising Stars: Like the Newbies, the Rising Stars have been practicing for less than five years, but are already experiencing substantial success; each manages at least $50 million in assets. They represented just 5.1% of the group.


Obviously, the Rising Stars stood out. So we dug deeper and found these results:

• Rising Stars work with lots of affluent clients. More than one-third (35.2%) of the Rising Stars serve 300 or more clients. While that’s similar to the 39.7% of Elite advisors, it’s very different from the other two groups. Only 21.7% of the Rank and File serve 300 or more clients, and only half that proportion of Newbies (10.8%) have so many clients.

More important is the number of high-net-worth clients the Rising Stars serve. A significant percentage of both the Elite (39.4%) and the Rising Stars (36.1%) have at least 30 clients with $1 million or more in assets. Hardly any of the Rank and File (2.5%) and Newbies (1%) have that many highly affluent clients.
Rising Stars even beat the Elites in the share of affluent clients on their books. As seen in the graph on page 20, 22.2% of Rising Stars have built practices that serve 75 or more clients with at least $1 million in assets, but just 15.8% of Elites have done so.

• Rising Stars manage surprisingly sizable assets. Among the Rising Stars, 13.9% manage $500 million or more in assets. The proportion of Elites at that level is just 5.4%. Likewise, more than a quarter of Rising Stars (26.9%) have $200 million to $500 million in AUM, compared with only 17.2% of the Elites.

It should be noted, however, that, even though they manage more assets than the Elite, Rising Stars earn far less net income.

Many Rising Stars (65.4%) report annual net incomes of less than $100,000. The percentage of Elites in that net income category is just 13.1%. Additionally, just 7.7% of Rising Stars earn net incomes higher than $200,000, a level of success that half (49.6%) of Elites have reached.

This makes sense when you consider that these two groups are in very different stages of their business life cycles. Many in the Elite group have already scaled up and become well-established, so they may not need to continue making major capital investments. The Rising Stars, on the other hand, need to invest heavily in their businesses, thus greatly reducing their net incomes at the present time.


Even with their relatively low incomes compared with top industry veterans, Rising Stars are experiencing success in many areas that is disproportionate to their experience. They clearly are taking steps to drive this success:

  • They focus on select clients. The best advisors understand that working only with clients to whom they can bring tremendous value is a must for serving them well.
  • Rising Stars get it. Nearly half of this group (48.2%) requires a minimum account size for new clients. Likewise, half of the Elite (50.9%) also have such thresholds. Among the other groups, the numbers are far lower: Just 25.6% of the Rank and File and only 18.5% of Newcomers specify a minimum asset size. 
  • They have formal processes for delivering exceptional client service. Affluent clients often face complex financial challenges that require significant expertise in areas well beyond investing, such as business planning and wealth transfer. A full 62% of Rising Stars say they rely on teams of experts to address their clients’ diverse financial needs — more than any of the other groups. 
  • They engage in focused planning. When it comes to having plans for moving their businesses forward, the Rising Stars are most likely to have business plans in place (73.2%). The Rank and File are the least likely, at 49.3%. The Rising Stars also win in the marketing race, with 61.1% having marketing plans in place, versus just 29.5% of the Rank and File.

Perhaps not surprisingly given their inexperience, the Rising Stars fall short only in succession planning: Just 16.7% of them have succession plans. We also found that more than four out of 10 of the Rank and File (42.4%) don’t have any type of plan at all. The same can be said about approximately a quarter of both the Newcomers and the Elite, but only 13.9% of the Rising Stars.
Clearly, this select group of young advisors is accomplishing big things in short order. Their approach to their businesses — which includes serving select clients, ensuring top-flight service and engaging in deliberate planning — can serve as a lesson to all advisors. FP

John J. Bowen Jr., a Financial Planning columnist, is founder and CEO of CEG Worldwide, a global training, research and consulting firm for advisors in San Martin, Calif.

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