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Investor Strategy News – March 3, 2019

While disaggregation among financial planning groups commenced before the Royal Commission, it is certainly more top of mind now. But not everyone is keen on going down that route.

A group of Perth-based businessmen is looking to raise $3 million in a first round of investment for a financial advice aggregation business, known as Broadleaf Financial Group, targeting small practices of one-four advisors.

The group is led by Richard Hernan, an accountant, and Dean Gilkison, a financial planner, who have become equity partners too. Hernan said that about $2 million was already committed from about 20 investors.

“This will not be a dealer group nor a product provider,” Hernan says. “We are building a community of customer-centric planners.” Broadleaf estimates that it has a universe of about 1,100 small practices to approach but is only looking for 10 initially. In time, he believed it could grow to about 50 practices.

“We’d like these businesses to be able to maintain their personality,” he says. “We want to make sure their values are aligned with ours. They can continue to provide high-value advice and to use their own AFSLs.” There will be no approved product lists nor an approved platform. Broadleaf may provide some technical support and paraplanning if required.

Stephen Robertson, of third-party marketing firm Winston Capital Partners, who is helping with the fund raise, says the need for advisors to be a part of a big institution is changing. They want succession planning for their practice and also an investor who is genuinely independent.” He says a lot of people from the industry are interested in the concept. “People will still need financial advice.”

Hernan says the company will provide multi-generational opportunities for advisors. He thought the first “hub” of advisors should be settled by the end of March.

– G.B.


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