Edelman Aims at 'Finish Rich' Author's Millions of Readers

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Best-selling financial book author David Bach grew up in a family of financial planners. His sister still runs The Bach Group at Morgan Stanley in Orinda, Calif., where she has $1 billion in assets under management, Bach says -- but she isn't taking any more clients, and he had no good answer whenever advisors asked him for a recommendation.

"People would see me on the streets, see me on 'Oprah,' and ask me for an advisor -- and I would have nowhere to send them," says Bach, a former advisor himself who says his "Finish Rich" books have sold 7 million copies. "In the last three, four, five years, it's bothered me more and more."

That problem may now be solved: Last month, Bach teamed up with Ric Edelman to build a firm they hope will one day serve millions of clients and boast a $1 billion valuation. The high-profile hire creates a revved-up marketing engine for Edelman Financial, which already has $13 billion in assets under management, 100 advisors and about 24,000 clients in 35 cities, says the firm's founder.

And the new partners make no bones about the fact that they want to lure Bach's millions of readers to become Edelman Financial customers.

"We know that the outreach that David and I are capable of doing can, in fact, get hundreds of thousands of people to seek out our services," Edelman says.


The new alliance -- which makes Bach vice chairman of Edelman Financial while Edelman continues as chairman and CEO -- makes plenty of sense, says industry consultant Timothy Welsh, the founder of Nexus Strategy.

"It's sort of a natural tie-in," Welsh says. "It's a great mass-marketing approach. You do need a media property to extend your reach."

The move also exemplifies a content-driven marketing strategy that other firms have attempted -- with varying degrees of success. After all, Edelman is hardly the first firm to partner with a media figure as a marketing strategy. (Some, like Charles Schwab, are even lucky enough to have a company founder who is also a best-selling author.)

Yet when two or more people are involved, however, the strategy has a downside: If the relationship founders, so may the business. "Whenever you hitch your wagon to someone else's star, you get the upside or suffer from the downside," Welsh says.


Just over two years ago, for example, two CFPs in lower Manhattan teamed up with the former host of MSNBC's "On the Money," Carmen Wong Ulrich, to form Alta Wealth Management -- with the aim of targeting African-American and Hispanic clients.

Yet the firm disbanded 18 months later. Two of the cofounders, Diana DeFrate and Katriina Paavola, are back in business on their own with their own names on the door: DeFrate & Paavola.

As for what led to the split, no one is talking. Wong Ulrich -- who now, after a divorce last year, goes by Carmen Rita Wong -- and DeFrate declined to comment; Paavola did not return multiple calls and emails requesting comment.


Things have worked out better for Buckingham Asset Management, a Focus Financial Partners-backed wealth management firm in Clayton, Mo., with $7 billion in assets under management.

Buckingham created its first "thought leader" 18 years ago when it brought on Larry Swedroe, who sits on the firm's board of managers and serves as its director of research; he now writes almost daily and has written or co-written 12 books.

And since Swedroe's arrival, Buckingham has added six other writers -- including New York Times columnist Carl Richards and Dan Solin, both of whom are also best-selling authors. (The other writers are Jared Kizer and Tiya Lim, both of whom were existing Buckingham employees when they started writing; Jim Whiddon, who like Richards and Solin wound up selling an existing practice to Buckingham; and Tim Maurer, also a veteran advisor who joined the firm to become one of Buckingham's "thought leaders.")

Over the same time period, the firm has expanded as well: forming BAM Advisor Services, a turnkey asset management platform, and BAM Alliance, a network of independent advisor firms.

Buckingham's content marketing strategy is relies on a mix of credible, independent voices on financial issues; the company doesn't dictate what any of its writers say, says Dave Levin, BAM's chief marketing officer.

But the strategy wouldn't work unless everyone's investment philosophies were aligned with Buckingham's, says Richards, who sold his practice to BAM when joining the firm: "It's a belief system at the core of what we do."

The writers are available to participate in meetings with any of the firm's advisors and their clients or prospective clients, Levin says; although Richards says he no longer leads planning efforts for any specific client, he is part of a team that serves different clients.

Yet other firms interested in a similar content-based strategy might also want to note Buckingham's time-consuming publishing process. The firm's writers typically publish once or twice a week, Levin says; the firm curates the content and posts it on its social media channels. Buckingham's internal marketing department also fact-checks each article or blog post and checks it for compliance before it is published.


Of course, Edelman leapfrogs the writer development process by hiring someone with an established following. Although Edelman and Bach knew each other from their published work, the deal began to coalesce last year, the pair say, after Edelman heard that the writer was seeking venture capital investors to help him start his own firm.

Edelman called Bach up; two days later, he flew to New York and the two met for a lunch at North End Grill in Battery Park City.

"I said, 'David, look you can go and do this without me,'" Edelman recalls -- "but I've got a huge head start and I would love to have you on board to come and do this with me."

The two left that meeting with a handshake agreement. They celebrated their partnership with a party for employees in Washington, D.C., two weeks ago and plan to formally launch the arrangement in September.

Anticipating a quick payoff from his new vice chairman's prominence, Edelman says the firm is looking to add another 100 advisors, preferably those who are women or minorities and serving those communities. "A big part of David's focus is in women and money," Edelman says.

Indeed, Bach claims to have helped educate 1 million women to be smarter with their money via his books and related workshops. "We want to become the leading firm in America where, when a woman goes through any [life change], she thinks of Edelman Financial," he says.

In the interim, Bach needs to shift back from author to advisor. He says he recently passed the test for his Series 7 license and later this month will be taking his Series 66 and getting an insurance license.

And Edelman is banking on the new content strategy to be a game changer for his own firm's growth. "We believe we will dramatically expand the content and the way that we market," he says. "We only have 24,000 clients right now. We are probably the largest independent financial planning firm in the country. We want to be the first [independent] investment management firm that has a $1 billion valuation."

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