EP 82 | Executive Search and Recruitment for Financial Advisors with Blair Lewis

David DeCelle  11:47

So have you ever…wracking my brain for the name of the book, and I think the title is called Rocket Fuel. It's an EOS book, and it talks about the visionary and the integrator, and how those are two totally different people and one can't really live without the other. What you're saying kind of reminds me of that book. And you answered one of my questions that I was planning to ask, which is, at what point does it make sense for someone to expand their team beyond an executive assistant and a junior advisor? I feel like those are kind of a typical first hires beyond you, the advisor yourself. It's, hey, I need another version of me, I need an assistant, perhaps I have a director of operations. But it sounds like if I heard you correctly, right around that 300 million or similar revenue to 800 million is kind of where you really want to start to find very, very high quality experienced people at that C-level. So with that being said, are you finding that most often, their first C-level person that they're bringing on is a Chief Operating Officer, or I guess, what else are you seeing in terms of other roles that have been needed as that first hire?

Blair Lewis  13:12

Yeah, usually, if you're going to go, if you're big enough — at usually three million and bigger in annual revenues is kind of what I would quote, “big enough” — what you typically see the first two roles that come through are Chief Compliance Officer and Chief Operating Officer. I mean, most people who create a wealth management firm, are not operations people. They're salespeople. They are financial advisors, they love investments, they love meeting with people, they're a people person. And so handling all the operations just isn't in their skill set. So that's a very typical first big position to hire. I had an interesting conversation with someone when they were thinking about the money. They're like, well, how much does that cost? And that's usually based on the size of the firm, but let's just for an argument's sake, say that I was talking about a $200,000 base salary plus a bonus that would tie them to certain KPIs that they might instill that were important to them. And so we're talking about that, and then they went to a conference, and they met with all these other successful RIAs. When they called me, they were like, Blair, I used to think that that 200 or 250 was going to be really expensive, and then I realized I was the only single proprietor or sole proprietor at this conference, everyone else had a partner. So they were essentially paying their CEO half of everything. Suddenly 250 sounded really cheap. So you deal with sticker price shock for sure. But usually Chief Compliance Officer — like, everyone typically likes the color orange, but no one wants to wear it, right? Especially not in a jumpsuit. So Chief Compliance Officer, Chief Operations Officer, those are usually the two first ones. I don't do Chief Investment Officers until people get beyond my normal sweet spot. When they get a billion dollars plus, and they start thinking, hey, we're in multiple markets, I'd like to create models, maybe get them into investment, maybe offer some interesting things, have other people distribute them. And then that's when I'm sort of looking at Chief Investment Officers, Chief Executive Officers, things of that nature. Those things usually come at a much higher end of the range, or as you’re cresting a billion and beyond.

David DeCelle  15:24

Now, when you come across a client of yours, or potential client of yours, or just a firm in general that has 300 million to 800 million, we'll stay in that sweet spot, I feel like they have a few different options when they reach that level. Option number one is stop growing, and you don't need to hire anyone, right? Obviously, that's probably not an option that people tend to go with, but technically an option. Another option is to continue to hire for the roles that are needed to continue the expansion. And then another option is rather than you trying to create this on your own, why not just plug into a multibillion dollar firm who already has those things in place? Technically, that's an option as well. So my question then becomes, when does it make sense? Have you ever come across someone where you're like, I don't know if they should be doing this on their own, they should probably just go plug into something that's already in existence?  Like, what is it about someone's qualities and talents and skill sets that make it more advantageous for them to just build this on their own and continue to be on the path that they're on as opposed to plugging into a different firm? Because you see a lot of consolidation in the industry, so I'm curious to know, what qualities do these people have where you have that belief in them? Hey, you know what, you can actually do this on your own. What do those look like?

Blair Lewis  16:48

Yeah, well, it's too generic of a word, but it's the only thing I know, and that is ambition. There are a lot of people, and I'll just use some giant companies that we all know. As a wholesaler, I was never attracted to the Putnam or the American Funds or Franklin Templeton job. Not because you wouldn't make a lot of money, not because you wouldn't have great conversations and meet good financial advisors, and all those things are fine. But I had the type of attitude that if I went to a place that was already wildly successful, no one was going to look back and go, and that's the day Blair showed up, and he changed the trajectory of this firm. Whereas if I went to a small firm that maybe had a cool product but they hadn't really built much out, I could look back and say, hey, I built that. It's the exact same reason where I've been able to afford someone to mow my yard pretty much since the first year I graduated from college. I continue to mow my own lawn, because it's one of the first, it's one of the few things I can actually physically look at a mess, do some work, and then look at something that looks really clean and pretty. And quite frankly, not to blow my own horn, but yeah, the best in the neighborhood. So I just, I get off on that type of thing. And there are people who feel exactly like that. And they think, it'd be nice, man, I could plug into this conglomeration, I'd get these services and things of that nature. And then there's people who plug into Model FA and say, hey, here's a section of my business that I'm not particularly good at, and I could use a lot of help here. And where I tend to look at people and go, you know what, you probably don't need me for this, you might want me for that — it's not in a hey, sell your firm and go be part of this giant thing. But it's a, you know, you really don't need a Chief Investment Officer; you can outsource your Chief Investment Officer for a hell of a lot cheaper. I could bring in 10 of them, you could interview all 10, figure out what services they like, what pricing models you like, what the services that you want, and figure out what's best for you. So I do a lot of introductions for outsource COOs or outsource Chief Investment Officers. I don't tend to get into the specifics of when someone should join another firm. I've always kind of felt like, I guess I felt like up to this point, I wouldn't recognize when it was better for someone to do that. Because a lot of that is their inner workings of what drives them and motivates them, and not a lot of people sit down and open that much up to me. They usually say, alright, here's my vision, here's what I need to accomplish; or here's my vision, here's the mess I’m in; what do you think I should do? But that might be because a conglomerator’s never come to me and said, hey, Blair, I'll pay you X percentage if you refer people to me. So maybe it's also self-interest driven, but I haven't recognized that part of the business yet. Cool.

David DeCelle 

Cool.

Patrick Brewer  19:40

Hey, Model FAs. I know you're enjoying this conversation, but I wanted to take a quick break to talk to you about the Model FA Accelerator. This is a unique collaboration between us and you, where we help you build a financial advising practice that you can be proud of. We focus on the foundational concepts around how to pick a niche or a specialization, how to price your services, how to construct an offer that people are going to buy, and then how to market it and sell it in a way that'll get people to sign on the dotted line and become clients of your firm, all while giving you the information to scale, and set up workflows and operational processes that will allow you to reclaim your time and build a practice that doesn't run you. So if you'd like to hear more about that, go to www.ModelFA.com/accelerator or www.ModelFA.com. Hover over Work With Us and click on Accelerator. Hope to see in the program.

David DeCelle  20:31

When you bring, let's use a COO as an example, you bring a COO into a firm, what are some reasons why it may not work out?

Blair Lewis 

I've had that happen.

David DeCelle 

Yeah. So maybe speak through an example, redact some names, of course, but like, what are some potential roadblocks that people at that 300 to 800 million dollar mark — what do they need to look out for to kind of save them some time of falling flat on their face with the initial attempt at expanding their business?

Blair Lewis  21:02

So with your last question, I came up with a one word answer, but didn't know that it fit, and that word was ambition. This word I know fits: it's ego. It is ego every time. It is, Blair, I hate running this part of my business, please find me a COO. And we do. And they come in and three weeks, three months, I don't know, three minutes into the relationship, the candidate is calling me and saying, oh, Blair, we keep agreeing that we're going to institute this. And then they'll go out on a sales meet, sales conference, and they'll come back, and all sudden in the morning meeting, they're integrating new policies that we hadn't even discussed. It's like, I'm supposed to be the one who's putting these things into place. I'm supposed to be the one who's vetting these, and they keep coming back with these ideas, or they're changing their mind, or the phrase I hear a lot is, they just can't stop getting in the way. And oftentimes, the CEO or the founder is completely aware of it, but they don't refute it at all. Like if I call and I go, hey, your guy’s struggling, you're on here, what's your take on it? They'll go, yeah, I do struggle with that. And it's, it could be ego, it could just be that they are someone who struggles with relinquishing control. And those are things that, quite frankly, people, no matter who you put in that role, they're going to struggle with that. And so part of building a great team is knowing your own strengths and weaknesses, and knowing how to get out of the way of your weaknesses, and trusting that you hired the right person, and trusting that they are putting things in place. Oftentimes, the only way you can do that is by hiring experience. I've recruited for several people that were like, hey, we have a young, ambitious culture, we want to keep that. But we also want to grow to 20 billion and we want to create all these things. I was like, okay, well, if I bring another 32-year-old into your organization, they probably haven't done all of that, right? They haven't seen those wars, they haven't seen things go to hell and learned how to fix it. So you'll have yet another person in your organization learning on the fly. And so oftentimes, someone has to kind of wrestle with, well, what is the culture of my firm? What things am I willing to sacrifice? What things may look different in a photograph on our website, versus Thank God, I hired someone with 20 years’ experience. We got into this mix, and they got us right out of it. And so it's usually ego or that just unrelenting need to control everything. I've hired people that have struggled, for sure. It luckily has been fewer and further between, but it happens. And when I'm vetting, when I'm getting to know the owner, I recognize those things if they're like, hey, we have a lot of turnover issues. Alright, well, let's dig into that. Why are people leaving your firm all the time? Sometimes they know, like, I'm hard on, like, I hold them to my standards. Well, good luck with that. Let's figure out a standard that is reasonable to hold people to, and let's kind of work from there. But yeah, those are some of the things that can go wrong.

David DeCelle  24:09

Seems like you're a mixture of a recruiter, consultant, therapist kind of all wrapped into one depending on the particular scenario.

Blair Lewis  24:18

Thank God, I went to school to be a pastor, right? So you kind of learn that, that call demeanor. I've got a sign — the camera’s pointing at me, it's not pointing that way — but there's a sign and it's stolen straight from, I think, the Navy Seals or the Marines, but it just says “Slow is smooth and smooth is fast.” And that's, I try to emulate with my, what I call, hiring managers because they're the person hiring, but they're usually CEOs or owner founders. But I tried to emulate “Slow is smooth, smooth is fast.” Let's create a process. Let's have a calm demeanor. Let's talk to people. If you have issues called me, run it by me first, let me know what your thoughts are. And that's not easy in today's market because candidates are flippin’ hard to find. A firm in Houston reached out to me today and they're like, okay, we're ready to move forward with that candidate. I was like, well, you went on vacation, and then you came back and got COVID, two weeks have gone by and that candidate’s got another job, man. I mean, you’ve got to be able to move these things forward. And that happens. There's other fish in the sea. But yes, I do end up being a therapist, I do end up being a coach, I end up being a sounding board. There's a lot of roles that I play in addition to recruiter. I'm kind of a weird recruiter. I like the term a headhunter, because that's what I feel like. I'm going out and looking for a certain type of person and bringing that person in. And I kind of like the idea of the headhunter that I think, more than anything, that encompasses how I see the job. So yeah, there's a lot of roles that I play, and that, quite frankly, is what makes the job fun. You know, if it was just cold calling and being told no all day, who would want to do that? But it's all the different roles that lead to the nuance, and it's also why when I first started, I was like, why won't people hire me? And now I realize like, oh, yeah, cuz I didn't know anything. There's a lot of subtlety and nuance and wisdom that kind of goes into being a successful recruiter. And so it's definitely the only job I've ever really realized what Malcolm Gladwell was talking about with the 10,000 hours. When I wholesaled, I was on the back of a hot product, so I had success immediately. If I had read that, I wouldn't have had any understanding of it. But after five years of doing this, I was like, golly, what I know now, and all the mistakes I was making early on. And most of them were the same thing that a lot of your audience deals with, which is a scarcity mentality, like this is all going to go away, and I'm afraid to invest in my firm. So by the time people come to you, they're probably at a point of like, hey, I've tried this twenty different ways and failed. And I've realized now, I need to invest in this part of my business. And that was hard for me to learn too. So, we all go through the same business cycles, and so yeah, it does lend to a lot of different roles within one.

David DeCelle  27:09

Let's pivot slightly. You had given an example, earlier in this conversation. I don't know if it was a legit example, or just kind of speaking in a general sense. But I know a lot of this has been focused on the advisor themselves, and how do we actually get them to continue to grow and free up capacity, get out of their own way. I want to now kind of speak through the lens of that C-level executive that you're bringing into the firm. So the example that you alluded to is, there was someone who was a COO of a 20 billion dollar firm or whatever the metric was, and then they're going to a 300 to 800 million dollar firm. Explain to me kind of like if I'm a COO listening to this, because we don't have just advisors listening to this podcast. We have support staff and other executives in the industry listening as well. What is it that is exciting to someone who's already kind of made it to that billion dollar mark running that size firm to then what could be perceived as downgrading to a smaller firm? What is your sales pitch, so to speak, to get them excited? What is it about that transition that lights them up?

Blair Lewis  28:26

And when you say, a perceived downshift, or something like that, it is. There's no way around it. I will tell you, I don't know how salty the language is that you require, or that you would like on your podcast, so I'll soften it up. But it's usually that the owner is a big jerk that they work for, and they’ve promised equity. They’ve been promised these things, and all the metrics, in their mind, have been met. They've achieved beyond the original expectations. And yet, I'm not an owner in this firm, I can be fired at any minute. Or, a lot of it is, well, it's a family run business, and my last name isn't same as the family that runs it, so I'm kind of limited here. There are just some people, I mean, my uncle was one of them. He just liked to, like, let me go take a car out of the junkyard, and it's got a cool body on it, and I'll piece it together over time, and I'll have a 65 Mustang. There are just people who like to tinker, and they like to build things. And so my goal every day when I show up at work, I don't always have something to talk to someone about. But my goal is to talk to three executives from RIAs across the country, just to get to know them. What makes you work? What gets you excited? What do you love about your job? In fact, I got a little sticky here. I learned this from a guy from State Farm Insurance, and it just says — I don’t know if you can see that but — What do you have? What do you like about it? What do you dislike about it? What do you want? I just keep that up there and every conversation I have, I try to figure out, what does this is person have? What is their gig? What do they like about it? What do they dislike about it? What do they want? And if I get to know enough of those people, some people are super friendly, and they'll tell you everything, some people are a little more reserved, and some of that’s geographical. People in the south are a little bit more open and giving. In other parts of the country, maybe not so much. But I tried to sort of build this database in my head, and of course, in my CRM system, that learns what people like. And I end every conversation about the same, which is, if I were to find something that had this, this, and this, based on their haves and their likes and their dislikes, is it worth a call? And most of them will say, yeah, if you find something like, that it is. Then I'll say, okay, at what dollar amount does it make sense for me to give you a call? And they'll say, well, it probably needs to pay at least X. So over an eight, nine year career of trying to do that three times a day, five days a week, you build up a pretty nice database of candidates that are not open to anything; they're as happy as a clam. Or, if you have this, I'd be interested. So then it's like matching. Okay, well, this person needs a Chief Sales Officer, and they need someone who knows how to motivate FAs, knows how to recruit FAs, etc. Alright, during this geographical area, I go to my CRM system, I type in keywords and search codes and all the magic that makes it hum and pull out a list of people to start calling and saying, hey, Blair. Or, I don't say, hey, Blair, they say hey, Blair. And I say, well, hey, back in 2018, we talked and you said this; I've got something like that. And that's legitimate. I will say, like, I had the conversation in Indiana today. I was like, well, in 2018, you said — he goes, well, life has changed since 2018, Blair. I don't know if you noticed. But it's just trying to be a good listener and understanding what makes people tick, because everyone's different. Most people are super happy in their jobs. I mean, it's not as if I call ten people and I get ten candidates. I call twenty and I get one. I'm pretty excited, like, okay, cool, I've got one good candidate. Because it only takes three or four, usually; if you introduce someone to three or four really highly qualified, wonderfully accomplished people, they’re going to hire one of them. So it just sort of builds on itself, and that's why I said earlier in the conversation, it gets a little better every year. It's just now I know more people, I can be more discerning, and that makes you a better recruiter too, because you're not clinging to every candidate and hoping to God this works. You have backup plans and Plan B's and all that.

David DeCelle  32:34

Well, it's cool to hear too, it's a reminder for folks who already have a legit team, that there's someone like you who's touching base with their folks who may catch them at the time where you had an argument, and they're like, you know what, I'm looking for a change, I'm going to reach back out to Blair. So it should hopefully, in theory, keep folks on their toes, appreciate what they have, make sure to focus on the culture within their firm. Because if not, there's folks out there that can find a better home for them. So hopefully, that piece of this conversation kind of puts into perspective the fact that you’ve got to be appreciative and take care of the folks that are taking care of you in the firm.

Blair Lewis  33:19

If you feel like you've got a steal on your hands, like this employee of mine, I’ve got the dollar amount I get for how much I invest in them — believe me, they feel that way too. It is not just you that thinks you have a good deal on that guy. You're exactly right. And I alluded to it with that example of someone going on vacation and things of that nature. People have options, an insane amount of options right now.

David DeCelle  33:45

Especially with the remote work and all that type of stuff, it's probably expanded the opportunities that you have to offer with people being open to hiring remote folks and working remote.

Blair Lewis  33:57

Well, and that's been a huge thing to overcome, because a lot of people were forced to allow their employees to work remote. I was one. I liked everyone in the same room. I liked hearing all the conversations and all of that, and then a pandemic led us to go work from home. And what I discovered from that is people are okay with their team who they have trust doing it, but when they want me to hire someone, they want that person to come into the office. And I'm like, okay, what premium are you willing to pay? Because these people are all working from home; they love it. And they're like, no, I don't want them to work from home, I want them to come into the office. It's like, okay, well, recognize that they are working from home, and so that may be a disincentive for them. I've got a client right now, one of the things that they say, and it's dead on true, they're like, hey, we have fifteen employees, and we have 7000 square feet. We can socially distance like no other. Everyone's got their own twenty feet of space around them. So yes, we're in the same building and we can all communicate, but you are safe. We're not going to get on people. It's amazing how many candidates I have right now that are from the Northeast, and they're tired of it. And they're like, hey, find me a job in Florida or Texas. I just want some freedom. And so, if you're based in that area, you might want to be open to having your people work remote, because people like me — and I'm not the only one — but I've got a stack of really high quality, amazing candidates that they just want to go to a restaurant not wear a mask, or have some freedoms that maybe have been taken away from them. I think I'm talking to one right now, David, didn’t you move to Florida just during a pandemic?

David DeCelle  35:35

I've been smirking, we're bringing Florida and Texas together. Yeah, I moved here a year and a half ago, for that very reason. I wanted freedom and I wanted nice weather, and I was at a point in my life where I could just pick up and move and start over and was fortunate that Model FA, even before the pandemic, we have a decentralized team. So it didn't matter where you lived. So I was like, you know what? I’m picking up and moving. And I've had a few friends of mine already follow down to Florida and move down here. So it's, you're opening up your pipeline a little bit more, if you're open to remote style work, or remote style workers, I should say, as a firm looking to hire. I can see how that's been a trend for sure.

Blair Lewis  36:21

And you can save quite a bit of money as well. I know, just little old me, running a boutique recruiting firm, when I moved everyone home, I personally took about $100,000 pay raise, because I no longer had rent and a in triple net lease and things of that nature. And so all that money like, oh, well, that just goes to me as the owner. So there's some great advantages to it monetarily, and you can use that as a perk in the recruiting process, where you're not having to pay someone this huge premium. If they're going into an office and are whipped to death by it, and you're okay with them working remotely, guess what? You can probably offer them a little bit less. And for them, that's a major perk, and they would take less to be able to work from home. So there's some ways that you can put those chips that are on the table, you put them right in front of you and have it work and leverage to your advantage.

David DeCelle  37:11

100%. Well, this was very helpful and insightful, selfishly, for me, because a lot of the recruiters that I've had experience with, they fit two categories. One is recruiting established books of business to be able to join a larger firm. And the other one is finding additional staff people but below that kind of C-level. So having you as that C-level style recruiter, this conversation has been helpful for me to understand how that space works and operates. Before we wrap up, for those of you who this may be your first time listening, part of the goal of the podcast, I was talking about obviously bringing on stellar guests like Blair and adding value in their area of expertise. The other purpose is to promote learning both in and out of our industry, and there's so many different books, as an example, that are out there that it's tough to determine, hey, which ones does it actually makes sense to invest some time in consuming. So I ask all of our guests what one of their favorite books is, and to explain why it's one of their favorite books and what impact it had on them. So Blair, you mentioned a book by Bryce Hoffman, American Icon: Alan Mulally and the Fight to Save Ford Motor Company. Why'd you pick that one?

Blair Lewis  38:28

Well, since reading this, I bought two Fords, by the way, but it was recommended to me. So I went to lunch with someone who worked for Bain, and they were looking to move across the country. And I didn't recruit in the space that they were in. But on her resume that I was giving her some coaching on, she had written this as her favorite book, and so I asked her about it. She told me enough that got me interested. I read it; I ended up buying twenty copies, and sending it to twenty clients that I had worked with that year, that was my Christmas gift to everyone. But it is the story of thinking outside of the box. And it is thinking outside of the box that are one of the biggest spotlights that is available, and that is Ford Motor Company. And I've continued to buy Ford stock even though it's certainly way more sexy to buy something that might be electric or rechargeable and things of that nature. But it is an outsider that he was moved into the CEO role of Ford Motor Company from the COO role of Boeing, and most people in Detroit thought he would absolutely fail. You just didn't come to the automobile industry from outside of the automobile industry. From a 30,000 or 10,000 foot view, there's obviously similarities between a giant plane manufacturer and a giant car. But what he had done as a COO at Boeing was really the efficiency, the processes, and he was so good at reading people and getting them to focus on what he believed was important. He has a lot of steps that goes into the book about how do you find out what's important about the process? And what are you trying to accomplish? And how do you work backwards from a solution back to the problem and vice versa? The turnaround that he had at Ford was absolutely astronomical, just in terms of quality, profitability, I mean, on any measurable that you can think of during his time. So, for me, it’s so rare that I get to recruit from outside of the industry. Most people in financial services, well, I'm trying to build an RIA, find me someone who's built an RIA, and I completely understand that, and I like to try to get one or two candidates in there that come at the problem from a different perspective. They're not often hired, but it's a good brain exercise for my CEOs to see how someone from outside of the industry would look at this problem. And beyond a lot of the a lot of the terminology that we use in this industry, a lot of problem and problem solving is the same. So I just really took a lot from American Icon about how you could lift out these systems and processes and decision making and team building, and it really just poured into my work and the perspective that I had on my industry change, and my appreciation for people who have different perspectives. I found it to be as enjoyable of a read as a fiction book, but I highly recommend American Icon. It's been a couple years since I've read it but just kind of talking about it today makes me want to go back and re-explore it.

David DeCelle  41:32

Well, I appreciate that overview. As you were going through that, I was sold about halfway through so I went on my Audible account and scooped that up. I'll let you know when I'm done with it, but I appreciate that. Appreciate you joining; everyone listening, appreciate your attention throughout this episode. Hopefully you got some good nuggets along the way. But with that being said, Blair if I'm a COO listening or a C-level person, or if I'm an advisor listening, and I'd like to touch base with you, connect, and perhaps engage with you, where do I go?

Blair Lewis  42:06

Probably the easiest way to do it is LinkedIn. I'm one of the only Blair Lewis’s on there. My company's called Global Recruiters Network; we shorten that to GRN. So you could find me at GRNmidcities.com or GRNmid-cities.com, they both work. That's usually the best place. I'm not super active on Twitter. You could probably find me on Instagram, but it's boring pictures of my family and things of that nature. But most of what I do is LinkedIn driven, and if you find the website, it will have a phone number. I think my phone number is on my LinkedIn profile so you can always call. Usually shooting an email gets it done; I answer all my emails and get back with everyone. So if you find me, you will find someone who will respond.

David DeCelle  42:53

Love it. Well, for those of you who are listening, hopefully you found some value in today's conversation, really appreciate it. If you did, do us a solid and share the show, perhaps even leave us a review on iTunes. Let's see if we can get from a top two and a half percent podcast up to a top point five percent podcast over this next year. We won't be able to do that without your help and obviously the help of our guests moving forward. So if you found some value, go ahead, share it, please leave a review. And with that being said, Blair, I very much appreciate your time spent today, the connection that we've begun to forge, excited to see where it leads and what it turns into. And obviously this is all a result of the introduction from Brian. So another shout out to Brian and thank you to him. But Blair, appreciate you joining today.

Blair Lewis  43:41

Man, my pleasure, Dave. It's been a long time since I've thought of some of those stories. So I appreciate the walk down memory lane, and I look forward to continuing our relationship as well.

David DeCelle  43:49

Awesome. Take care.