My Secret to AUM Growth

By Dan Solin

March 11, 2014

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I thought a comprehensive understanding of investing would be enough to grow my advisory practice. I’ve written a number of books on investing, so I considered myself an expert in the profession. But after reflecting on my less than stellar success closing sales leads, I found a deeper – and more scientific – approach to converting prospects into clients that yielded far better results.

Most of my leads came from people who had read my books and blogs. I assumed they came “pre-sold.” A typical scenario would go like this: I would get a call from someone saying how much he loved my book. He would ask if I would consider managing his money. When I said I would be happy to explore a relationship, he was thrilled.

Frequently a meeting would start with a request for my autograph. After such an auspicious beginning, what could go wrong?

Plenty, I soon discovered.

My former approach

I would talk about our advisory firm, including how it was founded and its investing philosophy. I buttressed my points with data, much of which is referenced in my books. I presented much like an attorney (I was a former trial lawyer) would to a jury: Here are all the reasons why you should invest with me and why we are a good fit for you.

Sometimes I would get the business, but more often I didn’t. In five years, I generated about $50 million in assets under management. Not terrible, but disappointing for someone who received so many promising leads.

Was I inept? How did other advisors approach prospects? To answer these questions, I accompanied other advisors on their presentations. I was struck by how similar their approach was to mine. Some even adopted a more formal lecturing style, standing at a podium and using PowerPoint or a whiteboard to emphasize their points to the one or two prospects in attendance.

I found out their closing rate was no better than mine. When I asked how they formulated their presentation strategies, they said they had never really considered doing anything different. The most common response was, “What other options are there?”

As an author, I rely heavily on research from peer-reviewed articles appearing in prestigious journals.. I wondered whether the same kind of research might help me convert more prospects into clients. Was there a more scientific way to sell?

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