1) Phone call; almost 15 minutes exactly; brevity is key so I’m not above 5000 characters.
2) In person interview. This was essentially a presentation with a couple questions and for firm to get a sense of some alignment issues
The marketing method is as follows; write out 200 associates, tenaciously pursue their business. Solicit referrals from them to generate a larger pool of associates and that is essentially where your market comes from.
I had done some research and had anticipated that they may operate with this method, and upon returning home, I responded to their email, which requested I perform their personality test, by requesting to be removed from candidacy. Here's why:
A) The 6 month 15k 'funnel'/draw does not produce a sound and stable long term practice for many reasons.
B) Soliciting 200 associates will be odious to many of these relationships and may undermine your relationships (which have intrinsic value) while, arguably more importantly, undermines your REAL potential to do business with these people down the line assuming you ARE really passionate about planning or providing other services for this community and that this IS what you want to do. Real Question: Do you think you'll be at PCRG for 25+ years despite potentially alienating 200+ people you know? Think about the answers and their implications both yes and no. And if you could not foresee that you would be moving around and you want to keep their business and charge them more fees etc, then what quality of financial adviser are you to these 200+ people?
C) According to my interviewer industry wide 90% of advisors leave the industry inside of 4 years (I did not interrupt to ask about the firm turnover rate). The idea that the position is 'difficult' has all kinds of reasons, including the marketing method.
But here's the ultimate breakdown for why I chose not to continue the interview process considering everything above:
The firm hires you. During the interview process you tell them about 200 associates with whom you feel like you can count on to sell services to, now at the very least (even if they dont hire you) your 200 associates are potential for their other advisers books. Lets say you are hired and you create accounts that generate 15 hours of fees for the firm (which could possibly be between 4500-7500 dollars on the planning side alone (at around 300-500 per hour), fees which probably don't 100% go into the accounting of your draw because the firm will probably not count 100% of the fee as income for you. You have just given them clients when 90% chance you will not even be in the industry long term or if you go to another firm they at least have a serious crack at keeping these clients for reasons we won’t get into so I can 5000 character maximum. So basically they are paying you the equivalent of 30k per year (although perhaps you will not last this long (really 15k for 6 months)) for you to be tenaciously trying to direct all of your associates valuable business into the firms pocket which (in brief) is VERY meaningful for them and not nearly as meaningful for you in terms of the rewards this business implies. And that's really the kind of maniacal planning of what they're doing here. They do not care about your career. They care about your associates’ money. They’ll certify you and pay you a little bit because it’s worth it to them to have your associates business potential in their system. Remember, you’re working VERY HARD for a statistically short period of time for a minimal amount of money. They sit back and sell policies that do not expire and investments that require a minimal amount of work on their part to produce and maintain.
In sum, even if I am of the same cloth of the successful 10%, it won’t be recognized or nurtured here.
Anticipating one possible rebuttal (firm term is "objection") to the position I've laid out above; is that 'this is just how the financial industry works, get over it' etc. And that may be true for a lot of the industry. Personally, I'm looking for a better opportunity. Even to get my foot in the door. What really can this firm tell me about planning or securities that I cannot figure out for myself? Especially because upon hiring and certification the firms business model is that I'm doing everything anyway. If the 90% failure assessment ends up true, even if I study hard and get my Series 7 etc chances are I will fail (which will be partly due to the marketing method) and then what happens? Bouncing into a new gig? Why would another firm hire someone who either has demonstrated a lack of production or whose worthwhile personal contacts are all used up? And if you cant bounce into a new gig or continue to perform these services in the manner in which the regulations allow for then your license lapses. Great. So I work hard for them so I can give them a doorway into all my contacts' finances. That's what it seems to me to come down to.
