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Implemented Portfolios News

The Locked Down Adviser – Rob Jones

By April 24, 2020 No Comments

What is your business really worth?

“Where are we headed in terms of how advice businesses are going to be valued in the future and what can we do right now as prudent business owners to maximise the value of our businesses?”

Phil Pilgrim (Corporate Development – Queensland at Implemented Portfolios) posed this question at the beginning of our Locked Down Adviser session with Rob Jones, the principal of Peloton Partners.

Rob begun by stating that he “comes from a position of facts and likes to let the facts and evidence speak volumes rather letting too much emotion enter the equation.”

He takes this attitude into every advice practice he values  in order to “give them some currency to understand what they are really worth in this day in age, not what perhaps they think they’re worth, or they were worth ten to fifteen years ago.”

He went on to say that although things have changed dramatically in the past few years, some tried and true methodologies have remained. “If you want to sell your business outright it is definitely going to be based on future maintainable earnings, based on EBIT (most likely) – i.e. revenue you can control.”

The subject turned quickly (as it often does) to advice business fee models, and Rob pulled no punches is letting viewers know from the outset that he is “utterly bored with the topic of people pontificating as to whether or not they have a fee model that is ethical and clear and transparent etc.”

He told viewers he is of the view that “There’s not one perfect model.”

“It’s not about percentage fees or fixed fees – its about the RIGHT fee. That’s what really matters.”

Rob Jones introduced the notion that perhaps, we have to shift our focus off the percentage based fee / fixed fee debate and rather focus our gaze on what the most appropriate fees are for individual advice businesses, in order to have sustainable, profitable business models.

So, how do you define the “right fee”, in Rob’s opinion?

He shared that his business (Peloton Partners) who as pricing experts have done this over 8000 times across Australia, still take 15-30 minutes to accurately price a single existing client of a financial planning firm. “You need that time to understand the services that business is delivering to the client, what value the client is receiving, what complexity factors and other factors that present in the clients’ circumstances, to finally unravel that correct fee.”  

For the full session and to delve deeper into some of Rob’s valuable insights on advice business valuations, click here to view the full webinar recording.

About Rob

Rob is the Managing Director and CEO of Peloton Parnters.

Previously, he was a Director and part-owner of The Money Managers Ltd., becoming General Manager (5 years) and CEO (3 years). While at The Money Managers, Rob established a division to co-own and manage start-up ‘Turnkey’ financial planning businesses. This grew to seven practices and $280 million in FUM. As CEO, Rob led a team of 53 staff in six locations with a budget of $12mil and EBITDA of $4.3 million.

After a successful merger with Shadforth Financial Group, Rob worked in the area of merger and acquisitions as well as implementing a national transition strategy for advisers and clients across the group.

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