Shanna Tingom is the Co-founder of Heritage Financial Strategies, an organization dedicated to empowering clients to own their financial future. With over two decades of experience in the financial services industry, Shanna specializes in working with women entrepreneurs, business owners, and leaders, as well as individuals experiencing life transitions (such as marriage or divorce). Shanna earned her Bachelor’s degree in Business from William Penn University and completed her Master’s degree in Organizational Management at the University of Phoenix. In addition to her work at Heritage, Shanna is a regular contributor to Investopedia, Kiplinger’s Personal Finance, and Born2Invest. Alongside the Heritage team, Shanna also hosts Making Money Fun, a podcast that brings fun and excitement to financial and investment planning.
Shanna joins us today to discuss what it takes to become an independent financial advisor. She explains why she decided to leave her former company to start her own practice and explains how long it took her to take the leap of faith. She outlines how she launched her business, the AUM she started with, and how she eventually integrated other advisors in the organization. Shanna also discusses why it’s important for her to create a business continuity plan and highlights the value of being a financial advisor.
“We do what we do as advisors and planners because we love it and it is meaningful not only to us, but to our clients. What we do matters.” – Shanna Tingom
This week on The Model FA Podcast:
● Struggling to match the corporate mold and why Shanna decided to be an independent advisor
● What made Shanna take the leap of faith to start her own company
● How long it took Shanna to transition into her independent practice
● Her starting AUM and what it took to scale her business to $150 million in AUM
● Shanna’s succession and business continuity plans for Heritage Financial Strategies
● Taking the leap of faith in times of uncertainty
● Integrating other advisors and staff members into the organization
● The technology tools and CRM that Heritage uses within the organization
● What the EOS model is and utilizing tech tools to focus on client relationships
● Shanna’s “Smile File” and the power of connecting with your “why”
● How Shanna got through an acquisition process that went sideways
● Book: Who Not How: The Formula to Achieve Bigger Goals Through Accelerating Teamwork by Dan Sullivan and Dr. Benjamin Hardy
● Book: Start with Why: How Great Leaders Inspire Everyone to Take Action by Simon Sinek
● Book: Think and Grow Rich by Napoleon Hill
Our Favorite Quotes:
● “Have a continuity and succession plan well in advance before transition papers get signed, so you can put the dumpster fire out before you combine businesses.” – David DeCelle
● “Listen to your gut, but don’t look over an opportunity just because it’s not perfect.” – David DeCelle
● “The beauty of our industry is that you can reinvent yourself and do things differently at the turn of a dime to ensure you can fulfill your promises to your clients.” – Shanna Tingom
Connect with Shanna Tingom:
● Heritage Financial Strategies
● Podcast: Making Money Fun
● Heritage Financial Strategies on LinkedIn
● Heritage Financial Strategies on Facebook
● Heritage Financial Strategies on Twitter
About the Model FA Podcast
The Model FA podcast is a show for fiduciary financial advisors. In each episode, our host David DeCelle sits down with industry experts, strategic thinkers, and advisors to explore what it takes to build a successful practice — and have an abundant life in the process. We believe in continuous learning, tactical advice, and strategies that work — no “gotchas” or BS. Join us to hear stories from successful financial advisors, get actionable ideas from experts, and re-discover your drive to build the practice of your dreams.
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President of Model FA, David DeCelle
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You know, part of the Entrepreneurial Operating System is really identifying what you're best at and sticking to that lane; and while that's been hard for me, anytime I start to get that frustrating, gosh, this is driving me crazy, I hate this, why did I do this?¼ I can then look and go, okay, I need to hire somebody in the firm that's good at that, because I'm not. And one of the mistakes that I think a lot of advisors make when they're hiring their first assistant, or their first junior advisor, is they hire a mini-me, somebody that's just like them, and that's just disastrous.
David DeCelle 00:43
Welcome Model FAs, David DeCelle here, president of Model FA and the host of the Model FA podcast. Really excited to have our guest here today, Shanna Tingom. So Shanna is the co-founder of Heritage Financial Strategies. She has more than 20 years of experience in the financial services industry. There's a lot that she's learned along the way, which we're going to unpack today, things to be excited about, things to look out for. After years of struggling to fit into the corporate mold, Shanna made the decision to become an independent advisor. She holds the accredited Asset Management Specialist designation, and she's also a certified Divorce Financial Analyst as well. Since opening Heritage Financial Strategies, Shanna has been a regular contributor to investopedia.com, Kiplinger's Personal Finance online, and borntoinvest.com. She makes frequent public speaking and guest radio appearances in Phoenix and nationally, as well as hosts her podcast, Making Money Fun, which can be found on iTunes. And just a note before we officially welcome Shanna, Shanna was proactive and reached out to me to be a guest on the show, which we always appreciate. So if you're listening to this show, and you say, hey, I got a good story, I got some things that I've been through the wringer, so to speak, in my career, and I have some things that I think would be helpful to others — feel free to just shoot me an email, which is [email protected]. Always open to have an intro call. Not everyone's going to be a fit; we'd love to have everyone on the show, but at the very least, I'm more than happy to have an intro call. And if we think that there's some value that can be added, more than happy to have you on the show. So with that, Shanna, I appreciate you being proactive in your outreach. I appreciate the time spent on the intro call and the energy that you brought to that. And thank you in advance for spending some time, but officially, welcome to the show.
Well, David, thank you so much for having me. I'm super excited to be here.
David DeCelle 02:49
Excellent. There's a couple main topics that we're going to go through today. So just to set the stage for everyone who's listening, Shanna spent a lot of time in scaling her business and over a short period of time has gone from three people at her firm to 13 people at that firm and growing. And she also went through the wringer, as I alluded to earlier, with a practice she acquired that went sideways. So we're going to stay within that scope today. But before we do so, you've been in the business for 20 years, and you had alluded to in your bio the fact that you had struggled to fit into the corporate mold, and then you made the decision to become an independent advisor. So I guess, give me a sense and give everyone else a sense as to what you meant, and what you mean by struggling to fit into the corporate mold, and let's start to unpack some of your background and your journey. And I'll jump in and ask some clarifying questions along the way.
Yeah, for sure. I think I'm fortunate for sure in how I started. So I started at Edward Jones, and I tell people all the time, it was an amazing place to start and learn because they have a very specific training program. They'll pay you a salary to study and pass your series exams, and while you're getting your book of business up and running; so I was grateful to be able to have that start. But pretty quickly, I realized that I'm not the kind of person that likes to be told what to do. Hence the fact that I'm now running a business.
We have that in common, that’s for sure.
Yeah, for sure. And they have a pretty specific way that they do things, from their technology to the products and services that they offer clients to even the way that they market for you to bring in new clients. They want you to do it their way. And that only worked until it didn't. And I really started to get frustrated that I couldn't do or shouldn't have been doing some of the things that I was doing. And I was successful at Edward Jones. I was always what they called exceeding expectations, typically two to three times the expectations for years and years and years, but I kind of did things my way a little bit under the radar; and then they started to figure me out. And that was a problem because I wasn't doing things their way. And so I really started to then look outside of that world. And I'd really bought into the theory and the dream of Edward Jones, which was you know that I was a lifer, at least I thought I was. Then I started to really look at what was out there. And at that time, I had an amazing business coach who focused only on financial advisors, and Suzanne is her name. She's still a coach today; Suzanne Muusers. And I sat down with her over wine on a Friday evening, and she'd been coaching me for a number of years. And I said, I think I'm ready to consider leaving Edward Jones, give me the names of the top three broker dealers that I should check out. And she put her glass of wine down and said, it took you long enough. I'm here now. So she did, and I did my due diligence; and I found a great home at Cambridge. They were a perfect fit for me, and I'm super happy there. And, you know, I really went from being told what to do every step of the way to being told I can do whatever I want every step of the way; which is really jarring, but liberating, and I've enjoyed it.
David DeCelle 06:07
So there's a lot to unpack there. And it's interesting, you say you don't like to be told what to do, and I'm like, hey, we have that in common. The other thing that we have in common is, and my girlfriend would attest to that, I don't like being told what to do. So it's not just me saying that. But with that being said, I know Edward Jones’ model fairly well, because I've worked with some folks there. And it's similar-ish to how I got into the business as well. I spent seven years at Northwestern. Similar in that they have a model. And the benefit, I always say I had a great experience at Northwestern, I always bring up the training program. If it wasn't for that — the independent space has no real training program, and that's why companies like Model FA exist, is to provide that for folks. But you have to fit in to a certain box. And for the right person, that can be a lifelong career, and that's fantastic to do that. But for some people, it's not. So I have a funny question to start, followed up by a more productive question. So the first question is, did you form calluses on your knuckles from knocking on doors? And then the second question was, you said that your coach, did you say her name was Suzanne?
Yes, her name is Suzanne.
David DeCelle 07:27
Okay. So, Suzanne said, after she put down her glass of wine, it took you long enough. How long did it take you? How long were you at Edward Jones before you mustered up either the courage with maybe some sprinkle of frustration? How long was that process that you spent at Edward Jones before you took the leap of faith to go out on your own?
Yeah, those are great questions. Yes, I did knock on doors. And we're talking today I'm sitting here in beautiful Gilbert, Arizona, which is a suburb of Phoenix, which this time of year would be beautiful to knock on doors. But imagine it when it's 122 degrees in the summer, and they require you to wear a suit with pantyhose or long pants. So that business model, even when I started which was in 2010, my “can sell” as it were for those Edward Jones's listening was in the summer of 2010. So that's when my prime door knocking time would have been. I did door knock for seven weeks, and then immediately after that said, there has to be a better way; and sort of started doing things my way pretty quickly, even though to them it looked like I was still doing things their way. So I was with Jones for three years, and I say I escaped a few months after my three year sort of training period ended. And up until then, up until really, I left in April. So this April 18, it'll be seven years that I've been independent. I didn't start considering leaving until January; it was that quick for me. And so up until November, December prior to my departure, I was still convinced I was staying. So convinced that I redecorated my office and gave away all of my Edward Jones furniture and bought all new furniture. So it was a pretty quick transition for me once I saw the light.
David DeCelle 09:15
What was it that made you see the light? A lot of times people will, there'll just be a number of little things that add up over time that get you to ultimately make the move, and perhaps that had something to do with it. But the way that you're saying this, it leads me to believe that there was a moment where you were like, alright, this is not for me. What was that moment, if I'm assuming correctly?
There were a few, and they all happened pretty quick, one right after the other. So, I was a pioneer at Jones on social media. They didn't allow FAs at that time to use any form of social media. They put me in the pilot program, and I was sort of one of the first in the firm to be able to use social media compliantly. And one of the things that I did — I was a Girl Scout growing up, it is cookie by the way, so if it's still cookie time when this is released, go out and buy your girl scout cookies. But I had a girl scout jacket that had all of my patches on it that I brought into the office one day because one of my clients was a troop leader of four girls. It was a tiny small troop. And she said, Shanna, can you teach these girls about money and investing for their money badge? And I said, absolutely. So I brought them in with, using marbles, I taught them about savings and investing and interest on the positive end, and then interest when you take a loan out, and we just had a great couple of hours conversation. I posted that picture on my social media page and almost immediately got a call from compliance at Edward Jones asking me if I had gotten my presentation approved by the firm.
David DeCelle 10:47
Sorry, I can't help myself. It sounds like you caused them to lose their marbles.
That's awesome. That is exactly what I did. Exactly. David, nobody's ever said that.
I can’t help myself sometimes.
That's amazing. As many times as I've sold that story, nobody's ever said that. Oh, my God, I love it. Yes, I did. And that caused me to lose my marbles. Because I was like, what? These are 10 year old girls. And they're like, were their parents there? And I'm like, no, like, I didn't even, it didn't occur. It just didn't occur to me that I was doing something wrong. And they said, well, you know that that's a violation, and we're going to write you up or whatever. And I said, oh, my, okay, whatever. I'm sorry. Mia culpa, right, I didn't know. And then a few weeks later, I was in a Toastmasters group, and I gave a speech that was recreating the eulogy I had given for my grandmother several years before that. And I sent the outline of that using my Edward Jones email to my Toastmaster friend, and they pinged me again and said, you didn't get this approved. And I'm like, it is a eulogy. It's for Toastmasters. This is not marketing in any way. I'm not even wearing my name badge when I give this speech, whatever. So it was a number of things just like that. And I went, you know what? I'm never going to fit in here. This is not going to work.
David DeCelle 12:12
That's frustrating, to say the least, when you have all the best intentions, and you're made out to seem like a criminal, so to speak, with what it is that you're doing. It's like, I swear I'm doing, I'm doing this — so, alright, I hear you.
I’m trying to do the right things. Yeah, so I mean, I think that that, for me, it was just really an eye opening experience, because I was all in on the vision and the mission of the firm, and on my way to being becoming a partner, and then I was basically told you got to stop doing it your way and buy into it our way. And I'm like, no, if I'm going to do that, I'm going to really do it my way. So that's when I decided to become an independent, and I haven't looked back; it's been amazing.
David DeCelle 12:55
Awesome. And so we have a number of folks who listen to this podcast who are already independent, and we have a number of folks who are in the Edward Jones, Northwestern types of models, and perhaps they're thinking to themselves, I've had a great experience, but maybe I'm not fitting into this box, as we've been alluding to, long term. And there are certain worries and concerns and self-doubt that creeps in right before you decide to make a move. So let's kind of unpack that a little bit. When you left, were you able to bring anything with you? And when you opened up shop, and transitioned and all that type of stuff, what did you start with? What was your AUM, where it's like once all the people who are going to transition, transition, it probably took a month or two or three or more¼what was the starting point of your business AUM wise, just so we can start to build some context?
That's a great question. Nine months, by the way, is what it took me to make my transition because I thought my Edward Jones assistant would come with me and she didn't. So I did it all on my own. But I brought about 20 million in AUM, which is about what I had. When I started at Jones, I started basically what they call new-new, which is no clients, and I brought these people into the firm. There were some that stayed that I was shocked by, and then there were some that came that I was shocked that they came. But for the most part, I brought almost everybody with me; and they're all still with me today, seven years later, for the most part as well. So, I think that Edward Jones and those types of companies do a great job of scaring you into the fact that you can't take your clients, you won't take your clients, they're our clients. Baloney. You're the advisor, you're the planner, you're the relationship. If done, right, that can happen.
David DeCelle 14:36
Cool. So I'm gonna — and I come up with silly analogies and metaphors, so bear with me. So we have one slice of bread, okay, and that's the 20 million. I want to identify the other slice of bread, which is where you're at now, AUM wise, and then we're going to talk about the meat in between as to how you got there.
For sure, no, I love that; great question. So seven years ago, I started at 20 million. Today we're at almost 150 million firmwide. In about five years, before the acquisition that we'll talk about here shortly, I added another about 25 to 30 million on my own, and changed my business model completely, and I'm happy to chat about that. But at Jones, I was all commission, doing all my own trades, coming up with all my own models. And then when I went independent, I tried to make that work for the first year, and it was awful and miserable and terribly expensive, and I almost went broke. And then I made the shift to using money managers and charging for financial planning, which we weren't allowed to do. And so I kind of reinvented my business twice in that first few years. But I added 25, 30 million in those first three or four years, and then bought a practice that had about another 20 million in it in November of 2019. And, if we're looking at slices of bread, that leaves us with about 40, 50, 60 million, somewhere in there. In 2021, I brought over three advisors, one of them that I trained at Jones, and he brought his book over; and a couple of other advisors started working with us and helped us to get to where we are today. So a lot of it was me, but we also have some amazing — I'm one of six advisors in the firm now, and so we have an amazing team of advisors that are doing the right thing by clients every day and help and contribute to that number.
David DeCelle 16:24
Awesome. So let's talk through — so I'm going to try and set the stage appropriately here. A lot of advisors get into the business to help other people and make a good living along the way. And they just remain advisors, which will make more sense with this context. They remain advisors for their whole career, and that's totally fine. And then there's other folks like you who continue to be advisors, but either haphazardly or intentionally at some point, realize that I'm running a business here. I’m a business owner, and I have the skill set, the power, and the influence to elevate other people within the firm, be it staff and producing advisors. What was that point in time where you said, hey, I think I can build something bigger than just myself? When did that idea come into play? Or did an advisor reach out to you and say, hey, I'm really liking what you're doing, can I joined? How did that start?
It's exactly what happened; the latter. I wasn't really looking; let me correct that statement, I was looking for one junior advisor in the summer of 2020 during the pandemic. I sort of had an aha moment. I have a great what we call continuity partner, another advisor in Portland, Oregon, who runs her business very similar to mine. And she's who would step in to take care of my clients if I got hit by the proverbial bus. So I've had that in place for a number of years, but she's my age with a young child, and there's no way she wants to own and run a practice in Phoenix, Arizona. And so I started thinking about my legacy and who I wanted to take over the practice someday when I want to retire, and a little morose in that way as well, I thought, gosh, if I get COVID, what happens? If I get COVID and get really sick or pass away, I want to make sure that this firm lives beyond me. So I posted a message in our internal message board at my broker dealer looking for a junior advisor. And I had some pretty specific criteria and listed those criteria, and I said, if this is you, reach out to me, and we'll talk. And I got three inquiries off of that; one of them who is working for the firm now. All three of them are actually working for the firm now, but I didn't intend that to happen. But I did hire a gentleman from Iowa and moved him to Arizona, and he will be a big part of my succession plan. The other two folks that connected with me are also advisors for me now, and they just will be a smaller part of my succession plan moving forward. And so that's how that happened. The Edward Jones advisor that I brought over, that I trained, came to me and said, what made you want to leave? We started that conversation, and six months later, he had transitioned as well. And so that's kind of the way it works. I don't really go looking for good people; they tend to find me. We're working with two other advisors right now from different places that are considering making the transition. And so this has sort of grown bigger than we anticipated, despite our best efforts to keep it a little smaller, but I love it. I love our team. We have an amazing support system with our support and client service team. And then all of our advisors are just wonderful human beings that I love working with every day. I've always said I don't want to be one of those super branches where my whole job is managing advisors. I mean, can you imagine a worse job than managing advisors?
David DeCelle 19:42
Hey, that's my job!
I say that a little tongue in cheek because we are advisors, right, David, that's funny. But yeah, I don't want to be that. I love working with my clients still, and I'll never give that up; but I also equally love running the business. And so what I do now allows me to do both.
David DeCelle 20:04
Love it. You bring up a good point that I wasn't anticipating talking about today. I mean, it's something that I find that a lot of advisors don't do in an overly like proactive way, which is continuity planning and succession planning. Now, my mom always taught me never to ask the age of a woman, so I'm not going to do that. But I am curious to know, are you retiring in five years, in 25 years? What, as you vision out, when do you — I'm not going to hold you to this, obviously — but how long is retirement from today?
Yeah, ideally, 20 years more, unless there’s a health challenge or something like that.
David DeCelle 20:41
So that's pretty cool, the fact that you are taking care of something that presumably isn't going to happen for 20 years. I'm sure, I'm willing to bet that in your discovery meetings or at some point in the process, you let your prospects know that you have a continuity plan.
And that's probably a really big selling point.
It is. It was bigger when it was just me in the firm; I did get that question a fair amount. And if you go to our website, you'll see Amy Walz, who's my continuity partner, listed in our About Us section. And her bio basically says, we hope you never meet Amy, because if you do, that mean something's happened to Shanna. But we want you to know that she's handled this. And I do get a lot of comments about that, and I've gotten a lot of comments from clients as I've introduced the concept of Amy; they've never met her. And again, I hope they never have to, but we'll be transitioning away from her being my continuity plan and my junior advisors taking that spot. But it really did bring them comfort, I think, especially in the age of COVID.
David DeCelle 21:43
100%. So you had said something to the effect of Edward Jones, it was commission-based. And now in your model, you're charging financial planning fees. And with companies like Edward Jones, Northwestern, their training program is so good and well-defined and structured to where some people can't even imagine going about their business in a different way. So one of my fears that I would have, if I'm listening to this, if I'm in a model that I want to transition, I'm considering transitioning, is I've sold my clients on a certain process in a certain way of compensation. How the heck do I have those conversations that they're going to now have to take money out of their pocket and give it to me for planning; whereas I was, quote, unquote, providing planning to them before? Which we know that typically, it's a deeper level of planning in the independent space, if you're doing a good job. What were those conversations like with your existing clients who had never paid a financial planning fee before, that you got to transition, and then you said, oh, by the way, you got to start paying me now. What was that like?
Yeah, I made a huge shift in about the third year, and it was, the timing was good. And I think, you know, I'm a big fan of Nick Murray so I leaned on a lot of his scripts. And I think that even today, folks that, if they decide to take the leap and do something today, there's something in our economic climate that could let them do the same thing. But essentially, I started making that shift the year of the Obama election, the first one. And so there was a lot of uncertainty around how that was going to affect the markets. I didn't know. And what I told clients is, for years I've told you, I don't have a crystal ball; I wish I did. And if I did, I wouldn't be sitting here today. But all I know is the market doesn't like uncertainty. So there's the possibility that this could temporarily be a negative thing for us, and I don't have the expertise to get out in front of this like I wish I did. And so, I was able to take my entire $20 million book and shift them to a fee based platform with the exception of maybe a million dollars out of that. I still have a few clients that love trading individual stocks. And for those clients, I've become an order taker; I don't do any research anymore, I don't proactively reach out and offer trade assistance. They call me and tell me what to buy or sell. But everybody else in that year of the Obama election, I kind of used that script of I don't really know what's going to happen, and because I don't, we need to be prepared. And it really shifted the conversation, and they all were like, yeah, we agree. None of us really know what's going to happen. So today, there are certainly things in the economy that could allow you to have a similar conversation to that. And it was just a really honest, there are things I'm good at and not good at, and managing investments, even though I've got all the letters behind my name, is not one of the things I'm good at. And so I found those conversations to be way, way easier than I thought. And, for the most part, every single one of my clients said, Shanna, you do what you think is best; and it's been the best move both for them and for me to not have to worry about that anymore. On the financial planning side of things, the way I addressed that was on a one off conversation. So most of my clients were super used to if you're in the Edward Jones environment, you're taught to call and pitch mutual funds and stocks and bonds and those types of things. So my clients were super used to me being, having those conversations. They weren't as used to me having the financial planning focused conversations, because that's not what you're taught. At least it wasn't when I was out working in the field. And so as they would bring up the questions about Social Security, or different financial planning related questions, then I would say, well, you know what, that's a really great question, and in my new business model, I have a way to be able to help you with those now that I didn't have before. And then I would go into the conversation around what we do for planning, what we charge for planning, how it works, and over a number of years, was able to transition a lot of my book to paying for those planning services. And it's been great.
David DeCelle 25:55
Okay, so there was an overarching, hey, here's how we're shifting the money management portion of our relationship. And then there was in your meetings, as clients brought up certain questions, you used that as an opportunity to bring up the planning. I'm sure some you're proactive with as well in bringing up the planning. Okay, cool. So essentially, it's bringing over that revenue stream over that nine month period. And then beyond that it was increasing or enhancing the revenue stream without additional service over time.
Yep, exactly. And that's, I think, a little bit why my AUM, it didn't grow rapidly in the first three or four years. It grew, but not nearly as much as it would have had I been in an asset gathering mode, right? Like when you're at a company like Edward Jones, or some of those air houses, your goal is to gather assets period. And when I shifted the focus to doing financial planning first, there were a lot of times I told folks not to roll their 401(k) to me because that presented planning challenges. And so, I just really grew a lot slower, but I have much stronger relationships with some of those clients than I do my asset management only clients; because we still do provide that service if that's all folks want today.
Patrick Brewer 27:11
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 will 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 28:02
So going back to scaling and integrating these other advisors, perhaps a staff person from them, or a staff person that's just needed for the firm in general, what were some of the challenges that you experienced in the integration of these various teams? And how do you balance that with your own relationship and client management and business developments? Do you have a day or two a week where you're a business owner, a day or two a week where you’re an advisor? What are some of the challenges that you've experienced in that process?
Yeah, for sure. Well, first thing to know is that we're a super technology heavy firm. We use a tech stack that is non-industry specific for the most part, which is a little bit strange. People ask me all the time what CRM I use, and when I tell them HubSpot, I get deer in the headlights, and because it's not one of the industry ones. And we've built our entire practice around HubSpot, and then the software package Precise FP, if you're familiar with that at all. So, we then kind of chicken wired and duct tape together our own little like ecosystem that, using Zapier and some other connection type pieces of technology, it just sort of feeds data back and forth, and it allows a really digital onboarding process for clients and a digital client experience. And then it allows us all to be able to work really wherever and however we want, because no paper files, no none of that stuff. So we had the framework built, and my husband and I built it kind of for me. And then when we decided we were going to be bringing on advisors, we kind of had to break everything that wasn't broken and re-chicken wire and duct tape it together, if you will. At that point for the most part, my husband was full time in the business. He gave up his consulting practice in technology and came over to Heritage; and so it wasn't easy for this mama bear to let my husband Eric have the reins with all the stuff that I had built, but he's way better at it than I ever was, and way more patient with all of the little quirks and idiosyncrasies. And so, we've broken a lot of the technology that I built and built it back better, built it back stronger, and just more scalable than it probably was before. And so now we're at a point where if we wanted to bring on a new advisor that had a current book of business — I think I told you it took me nine months to transition from Edward Jones. When we brought over my friend, Eric Pettit, who is the advisor that I referred to from Jones, last February, it took us nine weeks to do what it took me nine months to do, because we had the technology built around him to support him, and the team to help him. And so that's really our value proposition, or for those folks that don't want to build the business that we've built or run a business, we can plug somebody from a wire house in and sweep all of your clients over before they've even known what hit them, and works pretty amazingly well. And for that, I give my husband credit 100%, because he's helped us build those systems and processes, for sure.
David DeCelle 31:04
That's cool; nine months to nine weeks thing, and we believe a lot in utilizing technology to take care of all of the non-human components of the business to free up time to do more of the human components of the business, whether it's advancing the relationships with your clients, pouring some love and attention into them, priming the pump, so to speak, so that when you go in and ask for an introduction, or whatever the asked may be, they're excited and ready to help you out because you've made them feel really good. And technology allows you to get out of the weeds and work in the business. So before we transition, because I do want to get a sense as to what you learned through one of the acquisitions that didn't go as planned, and perhaps this was when you were in charge of the technology and not your husband. Just kidding.
You're not wrong.
So you said something earlier about how, and I know we joked about it, but like who wants to manage advisors, right? So at what point, whether it be AUM wise or amount of bodies in the firm, at what point do you think that it goes from this is fun to this is not fun? Have you visioned out, hey, I want to kind of cap our growth at this, like what is the this that I'm kind of alluding to?
Yeah, that's a really good question. I think for us, so we started to, in kind of the summer of 2019, my husband and I started to realize that if we weren't careful — he's in been involved in businesses before that, as they grew, he earned less money and there was less profit, because there was more people, but they weren't working as efficiently as they could be. So we kind of sat down and had a conversation and said, what do we want this firm to look like? I was getting to the point of capacity, or at least I could see a future where I would be at capacity. And we developed a pretty nice lead generation machine. And I knew there was going to come a point where I couldn't service all those clients, and so what do we want this to look like? And that's really when we decided at some point in the not so distant future, he would be joining the firm to help run the firm. And we embarked on the Entrepreneurial Operating System, the EOS model, if you're familiar with Gino Wickman, and we had our first meeting with our implementer in November of 2019, and it was just Eric and I. And then over the last couple of years that we've been working through that system, we've added three more people to our leadership team to try to get Shanna out of all of the day to day operations, especially of those things she's just not good at; doesn't enjoy, honestly. And so as long as I get to keep doing what I'm good at doing, which is I'm really good at being the Rainmaker. I'm really great at the relationship part of things. And as long as I get to keep doing that, I don't really care how big we get. Because if somebody else can come into the practice and do those other things, then Shanna doesn't have to manage the advisors; somebody else gets to do that.
David DeCelle 34:14
It's cool to hear that your self-awareness is at a point to where you're staying on top of not just managing your time, but managing your energy. And there's a really good book, I'm not sure if you've ever come across it, but you've kind of alluded to some of the principles in there, and the title kind of gives it away but it's still worth reading, which is Who Not How. So not like how do I build this? How do I do this? It's who do I get in the seat that can help with the thing that I'm not good at? And it seems like you're aware enough to do those things and successfully avoiding some of the pain that you would experience if you tried to tackle that on your own. Because I've seen people that go down that path and they just fall out of love with the business, and they just resent it. And that's not a good place to be in. So it's cool to hear that you're acknowledging that.
Thank you. Well, there are two points that I'll make on that one, because I think that's a that's a really good point. I've gotten to that point twice, actually, in my career. Thankfully, I have a wonderfully supportive husband, who, when I say I want out, he says, let's figure out how to get you out. And then I start to learn why I fell in love with the business to begin with. And, part of the Entrepreneurial Operating System is really identifying what you're best at and sticking to that lane. And while that's been hard for me, anytime I start to get that frustrating, gosh, this is driving me crazy, I hate this, why did I do this, I can then look and go, okay, I need to hire somebody in the firm that's good at that, because I'm not. And one of the mistakes that I think a lot of advisors make when they're hiring their first assistant, or their first junior advisor, is they hire a mini-me, somebody that's just like them. And that's just disastrous. I can't imagine what that would have been like, if I had hired myself in those early days. I don't think I could have handled me. So I've been super lucky to find amazing people who are very different than me. We respect each other, we stay in our own lanes as much as we can, and that is what has kept me from quitting when I wanted to. Because, for sure, there have been twice that I can tell you in that I have very clear memories of wanting to quit, because I built this business that I hated. And it took me realizing that I wanted to quit something that, at a core level, I love so much, to make that drastic change and to get to that point. So for those that are listening that are thinking this was all smooth sailing, it for sure wasn't. I've gotten to that point twice, and it sucks. But I'm here to live to tell about it. And that's the beautiful part of our industry, I think, is that you can reinvent yourself and do things differently on the turn of a dime. And I've done that a couple of times in order to make sure that I can fulfill my promises to my clients.
David DeCelle 36:57
So you brought up something that I hadn't really thought about that way. And then I got another book recommendation that you made me think of. So one thing is if I'm not happy, what's causing my unhappiness? And let me have someone else do that, where brings them happiness. That's really cool as like, alright, if I'm not happy, let me just pause and think about who can take the unhappiness off my plate to just keep me back in my lane. So it was a really cool thing to hear. The other thing that you alluded to — so there's a book that I'd highly recommend anyone listening to pick it up if you haven't read it yet, by Simon Sinek called Start With Why.
I love that book, that's one of my favorite.
Oftentimes, when your feathers are ruffled, so to speak, it's usually because you've gone from what you're doing being a passion to what you're doing being a job. And usually the disconnect is forgetting why you started in the first place and reconnecting to your why, reconnecting to your vision, reconnecting to the impact that you initially set out to make, tend to get you back in the spot, mentally, that you need to get back in. So I thought that those are two really good points.
That's a great point. And one thing that I do, I mean, because we all have those times that are like, we're feeling kind of down like is all the work that we're doing worth it? I have kept something for 25 years that I call smile file, and it's a little file that goes with me wherever.
I love this; I know what you’re saying.
And whenever I get a note, whenever I get a good attaboy, or whatever, or pictures from a client after they finished the addition on their house that my planning helped them build, whatever, I throw it in that file. And man, especially during the worst of COVID, when there was so much uncertainty, and we were all feeling so isolated, that file got me through some pretty dark times. So that's something that, we do what we do as advisors and planners, because we love it. And it has deep meaning, not only to us, but to our clients; what we do matters. And it's easy to forget that when you're dealing with the craziness of the market, and the minutiae of all the stupid paperwork requirements, and all of these new regulations, it's easy to lose sight of that.
David DeCelle 39:12
I was expecting some happy tears, Shanna, you'd let me down. I was getting a little choked up on my end thinking about the impact that has.
Oh, man. We do, we do. And yeah, what we do matters and it's easy to forget that.
David DeCelle 39:31
So let's go from some happy tears to some real tears, potentially; not on the show, but perhaps at the time. So all I know from our intro call is you had an acquisition that went sideways. And that's all I know. So my question is, or my statement is, tell me more.
Yeah, that's like putting the bullets in the gun there. So, yes, in 2019, at the beginning of 2019, I connected with another advisor in my company, in my broker dealer, who was trying to figure out his exit strategy. And I did all the due diligence I thought was necessary. We had all kinds of meetings and worked with attorneys and transition specialists, and I thought I did everything right. Looking back on it, what I didn't do was listen to my gut. I think, I don't know if men are better at this than women, but I think if there's women advisors listening, they might agree that sometimes we don't do the greatest job of listening to what our gut is telling us. And my gut was telling me something was wrong. I didn't know what it was at the time. But I remember the day that I signed the final agreement, November 1, 2019, I almost threw up, and I thought it was that I was just making such a big financial commitment and stepping into such unknown territory for me. But looking back on it now, it was my gut trying to tell me something was wrong. And I don't even know if either one of us would have admitted at the time, really what was wrong, but we thought our investment philosophies matched; we thought our financial planning processes matched. But what it really came down to was this was November of 2019; February, March of 2020, COVID hits and the world kind of loses its mind. Always the plan was to move all of these clients over into a managed strategy that we didn't manage, and yet, we hadn't had time to do that. So the exiting advisor was responsible for doing all the trading on all the models that he had built. And at the same time, he had a bunch of turmoil in his family. His father passed away, two of his brothers were diagnosed with diseases, and his life sort of went haywire. And he stopped trading, essentially. And when he did trade, it was a mess. And so, I kind of had to step in that summer and go, what is going on? I'm looking at the trades or lack of them, and I'm looking at what's going on. And I'm realizing that something is horribly, horribly wrong. And then in the midst of this, we realize that his brother, not one of the two that had been diagnosed with something but one of his other brothers who was his licensed assistant, was doing things that he shouldn't have been doing and compromised the social security number and nonpublic personal information of one of our biggest clients. And so we had to terminate his brother, and that didn't help the relationship. So all of that kind of culminated into me sort of having to take things over in November of 2020, and sort of it necessitated his exit from the business four years earlier than we had told his clients was our plan. It ended up being a good thing for everybody involved. It ended up, the clients ended up better for it. We ended up financially better for it, because we were able to renegotiate our deal. And he ended up being able to get out while still, while not having any problems. But for the better part of 2020, in the midst of the pandemic, I was trying to figure out — I mean, there were several times where I said to my team, I just want out. I want to undo this purchase, I want to give him back his business, I want no part of this mess. I have enough to worry about. And so it made a stressful year a thousand times worse. So yes, there were absolutely tears shed in 2020 over this.
David DeCelle 43:06
I think there's a few lessons that I learned as you're going through that that I'm going to try and formulate in a concise way. So one is, don't manage the clients’ money; have someone else do that. Because if something happens to you like with him, you don't know his philosophy, per se, you don't know how to step in; you got to confirm things with the clients, all that type of stuff. So just take that off your plate so you can focus on being an advisor and not a fortune teller, would be number one. Number two, and I'm kind of conflicted on this one, because I want to say listen to your gut, but you just said that it ended up working out in the end, and there was just some pain along the way. So part of me is like, listen to your gut, but not everything's going to be super smooth. So don't necessarily overlook an opportunity because it's not going to be perfect. Part of it's like, well, earn the business. So I’m kind of conflicted on that point. And then the third one is something that we talked about at the beginning, where have a continuity and succession plan well in advance where philosophies are already in line, you've gotten to know the person well before transition paperwork has been signed. You're able to understand each other's systems and processes so that you can put the dumpster fire out before you end up actually combining businesses. So that's what I took away from that. So that was helpful to go through. Appreciate that.
Thank you. That's a good point. Because a big part of the reason why I went through that looking for a junior advisor was because I was in the midst of this; I didn't want this to be my transition. I didn't want 20 years from now me being that person for a younger advisor and having to deal with this all over again. So I will 100% agree that that experience was valuable, because when we buy another practice — and I used to say I'll never do it again but my team has said to me, Shanna, you can't say that because then immediately it will happen. When we buy another practice, we'll do it very differently. The other thing that I didn't do in that acquisition that I would say I wish I had done, my director of operations, Danielle, who's been with me three years now, and my husband, were both saying there are red flags here, Shanna. There are red flags here, Shanna; and I didn't listen. And I just thought they were scared. They didn't really see my vision. But early on in this relationship, this advisor, they both said, there are problems; and I'm like, oh, there aren't problems. You're just being persnickety. There were problems. And I wasn't willing to admit it.
David DeCelle 45:39
Well that's the not liking being told what to do, coming out right then and there. So I think it's, I'm just kind of thinking out loud here, but before you buy another practice, if you haven't done this yet, it may be helpful to — I'm sure you've reflected on this previous purchase — but reflect more analytically, to where perhaps you can even come up with like a checklist that, okay, do they have this? Do they do this? Do they not do this? So that you can look at this piece of paper afterwards and say, hmm, there's too many things that aren't the way that they should be. So based on the data, I'm going to move past this opportunity and try and find another one. So perhaps something like that could be helpful if you haven't done it yet.
Well, I love that idea. And I've said, if I didn't already have like three full time jobs, I should write a book about how not to acquire a practice. Because I think that, when you're in the heat of the emotion, right, when you're in the honeymoon stage of the practice buying, it's hard to be objective.
David DeCelle 46:47
Yeah, an idea for writing a book within that to make it easier is they have folks out there and tools out there, so tools that you can kind of just spit ball and talk into the phone and it dictates it for you. And then there's also copy writers, who they'll just hop on a Zoom call with you once a week and just ask you a bunch of questions, and they formulate it. So I think that'd be helpful for a lot of advisors, or even whether it's having you on again, or doing a podcast on your own, just kind of riffing through all the things, that could be helpful. So before we wrap up, for folks who may be listening for the first time, one thing that we do with all of our guests is we ask them what their favorite book is. Selfishly, I want to know the best books out there, but also, we want to help distill a reading list for everyone listening. For those of you who listened to a bunch of our podcast, you already know the deal. So this is a book that I have already read and have already read multiple times, and it's an annual read to help kind of set the stage for the year that you have ahead of you. It's something that's awesome to go back to. So you chose Think and Grow Rich, I was gonna say by Napoleon Dynamite, but that's not right. By Napoleon Hill. So by Napoleon Hill. I'm in agreement, I think that should be one of everyone's favorite books. But why did you choose it to be yours?
Yeah, I mean, I think that in this industry, and I read it well before I was even a financial planner. I mean, I was probably 18 or 19 years old when somebody suggests that I read it. And like you, I don't read it annually, but I do read it again periodically, because I think that it really does illustrate how what goes on between your ears manifests itself in your wallet and in your relationships, and all of those things. And that's hard sometimes for us to remember in this industry is that the impact that we have on people is what pays our salary. It isn't the documents that we create, or the portfolios that we manage. It's the mindset that we allow them to, with our help, shift over time. And so that's always a good read if you're feeling a little bit like what you're doing doesn't matter.
David DeCelle 48:59
Love it. Yeah, I think there's been so many scenarios, well after I've reread the book, that either nip me in the butt or catapult me to where I'm going. I'm like, oh, yeah, but I've been thinking about that for a while. And it's a reminder of like, well, that's happening because you're thinking positively, or that's happening because you've been thinking negatively. And sometimes, the universe has a way of smacking you upside the head or patting you on the back, depending on what it is. So some gentle reminders and sometimes not so gentle reminders, but yeah, our minds have a lot of power. So with that, if I'm someone who just wants to follow along with your journey and listen to your podcast and be a fan from afar, or if I'm someone listening who wants to explore what you have going on because maybe they're bored or lonely on their own, and they want to be a part of a fun team that's doing cool things. Where can people find you? Where would you like to send them?
Yeah, for sure. So our podcast is Making Money Fun; can find that anyplace you get your podcasts. And this year, you'll hear all of my team instead of just the Shanna show, so I'm excited about that; you'll get to hear from all of them. We have a website at HeritageFinancialAZ.com, and all of our social media is some version of that. So we're on Facebook, LinkedIn, Twitter, and Instagram. So feel free to check us out anywhere that you want to on the social realm. And then my husband and I do run a consulting business as well helping folks with the technology side of this stuff, so if you want our advice on technology or process, we can also help with that at TingomGroup.net.
David DeCelle 50:36
Well, we'll probably going to chat you and I, at some point soon, because we help with that conceptually, but we don't get into the weeds at all. So perhaps there could be some collaboration amongst us at some point. So with that being said, for those of you who are listening, hopefully your belly is sore like mine from laughing today; this was a fun episode. There was a lot of value in there. So if you could be so kind as to share this episode with someone that you think would find it valuable as well, we'd really appreciate that, and even go as far as to leave a review on iTunes. We recently just found out that we're ranked in the top two and a half percent of all podcasts globally, which is super cool. And it's all a result of our amazing guests, and all of you listening and sharing and spending your time and giving us your attention, which we very much appreciate. So if you would be so kind as to leave us a review, and once that's posted, if you screenshot it and just shoot me a text that 978-228-2338. You'll get an automatic reply that will have you put in your first and last name so it gets added to my contacts, and then beyond that text is actually me texting you back and forth. So if you send me that screenshot, and include Shanna's name, which is just S-H-A-N-N-A, I'll know which episodes in regards to, and we will give you free access as a thank you to our Model FA Accelerator program, which is all of our digital content library of all the relationship building, business development, content marketing, all the videos that we have in that regard as a thank you for doing so. So with that being said, Shanna, this was a pleasure. I very much appreciate your time. This was not just helpful, but it was also really, really fun. So I appreciate the energy that you brought to the show today and excited to continue to building upon the relationship that we started.
Thank you so much for having me, David. I appreciate it.