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Arrow Private Wealth is a Melbourne-based private wealth firm delivering advisory services to select private families, business owners and professionals. Arrow has had a long-held vision for its firm, which is ‘to be significant and relevant to its clients and families for the next 50 years. However, it became clear to the firm’s leadership that there was a gap in their service offering, which could potentially hinder them from achieving their vision.

The gap was the divide between the established high-level advice Arrow offered to their clients and what the younger generation wanted as an engagement model. Arrow could see that with the advent of new self-directed investment platforms, a new way of seeking wealth-creation solutions was not going to be congruent with their current services or pricing model.

“We questioned how we could provide these new investors with access to safe, strong solutions, rather than referring them on to a typical ETF style direct investment platform, where there would be a lot of luck with choosing the right investment options.”

– Peter Leggett, Executive Chairman & Chief Investment Officer

When prospects aren’t fitting your service model

Like many firms, Arrow was grappling with a need and desire to offer advice opportunities to their client’s children, grandchildren, and other family members, who may not need a fully comprehensive advice solution.

It was also an issue for their referral partners, which included accounting firms, mortgage and commercial brokers, and legal firms when they were reluctant to refer clients who only needed a low-cost or straightforward investment solution.

The private wealth advice solution Arrow are well known for is costly and time-consuming to deliver and was prohibitive for many of these prospects. Also, being a small boutique firm, Arrow didn’t have the capacity to consider offering these services at a lower fee point.

The pressing issue in making a move to change was the need to begin engaging with the younger cohort now and not wait until the point the wealth was going to transfer from their parents or grandparents. With younger investors accessing investments like ETFs via direct investing platforms, the Arrow leadership team understood these potential clients would be reluctant to leave and be convinced of the benefits of comprehensive advice at a later date.

The time to make a move was now. As Arrow is future-facing and always thinking 5-10 years ahead, they wanted to seek an outsourced solution aggressively. In addition, their insight into the themes and trends of direct investing meant they wanted to be ahead of the curve.

Finding a solution that complements its established services

Arrow was resolute on its need to partner with experts to deliver high-quality outcomes to its clients rather than try to accomplish this alone. Getting the right solution up and running faster was more important than following a complicated path to building their own stand-alone platform.

Working with OpenInvest was a great example of proactively seeking a best-fit solution. Once the partnership with OpenInvest was decided, it was necessary to lean into all the solutions the new platform provided.

Not only did they want to integrate Arrow’s investment management proposition and managed accounts capability (a core strength of Arrow), it was important for the team to begin educating this new cohort of clients about all facets of advice. The firm needed to become relevant and show authority to this audience, and it could now do that by delivering educational content and insights in a one-to-many format via the platform’s inbuilt content distribution functionality.

The new platform solution was not only diversifying their service offerings; they now had an efficient delivery method for a small firm and had taken an important step toward a holistic family succession proposition.

Moving from idea to implementation

For the Arrow team, the process from ideation to implementation was lengthy. The reason was that the business had a more significant strategy of moving to its own AFSL and therefore took longer to implement.

This new licensing structure was driven by not wanting to operate under the risk tolerances and licensing conditions of another AFSL. So they needed to partner with a platform solution and team that could be open-minded in designing a solution that suited their value proposition and was also considerate of their competing AFSL setup needs.

“The strategy that we were pursuing meant we needed to operate under our own AFSL. We wanted to implement this new solution within our own risk tolerances and risk appetite.”

– Peter Leggett, Executive Chairman & Chief Investment Officer

The Arrow team made a conscious decision to find a solution that was quick to put in place and start offering to clients. They knew that choosing an off the shelf and plug and play option, like OpenInvest, would get them ahead of the game quickly.

To make it work effectively for the whole team, they required discipline around scripting for team members. It was then very clear when to offer this solution, with explicit risk management on how the information was delivered to clients.

Arrow now has a low-cost solution complementary to its comprehensive advisory services, and it can continue leveraging its capabilities to deliver investment outcomes. Communications to clients and referral partners about the new solution have been well received, particularly by accounting partner firms. The firm now has two solutions for referral partners, which have made referrals easier and strengthened the referral-partner relationship.

Implementation tips from Arrow Private Wealth

An essential step for any firm is considering its ideal client experience and what it should look like. But in doing that, the business shouldn’t forget its core offering. Any new solution should sit comfortably alongside the firm’s core advice offerings.

To summarise some key points:

  • Make sure you understand how long an implementation phase will take
  • Have a phased growth strategy for how you want the platform take-up to develop
  • Implement the right processes and scripts to assist team members in how to position the new service to potential clients
  • Communicate to your existing clients and referral partners about your new service
  • Be prepared to learn and evolve with feedback from your clients

If you would like to know more about how a solution could help your firm serve new markets and improve your growth opportunities, reach out to us at OpenInvest for a discussion.

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