Engine Room Podcast #8 – David Moloney – Transcript

Andrew Rocks
Hello and welcome to the engine room podcast. My name is Andrew Rocks and over the next hour, we’re going to work out what makes really good quality practices tick. And it’s with great delight that I’m speaking with David Moloney from Yarra Lane. Today, Yarra Lane is a long term established business but has just put a bit of secret sauce in the mix the last year. So it’s going to be really exciting to hear about where David’s come from, how he has built the engine of his financial services group, and what he thinks of the future. So without any further ado, David, welcome to The Engine Room podcast.

David Moloney
Thanks for having me, Rocksy, cheers.

Andrew Rocks
And like all good podcasts, it’s good to try and get a bit of a feel for who we are. And, and I actually our Matt did some, you know, obligatory stalking, and you must have wanted to be a financial planner from the get go, because you’re one of the very rare people who studied financial planning, Bachelor of financial planning at RMIT. So maybe, with that in mind, give us a bit of an idea of how you’ve come to be where you are today.

David Moloney
Thanks, mate. Yeah. So we’re, we’re a small cohort. Back at uni, those 1000s of business graduates, but we were only 21 of your planning was at the time, yes, spot on. And it was part of a greater economics and finance degree. But yeah, we drill down into financial planning. So at the time, lot sharper, but the right terminology, but we could walk out about a degree in V. RG 146 compliant, so that was the idea at the time.

Andrew Rocks
And of those 20 people who did that course, did most of them find their way into financial services.

David Moloney
It’s a good question, I think, was probably one of a handful left, really, I think most of left the industry, which is interesting. So obviously, people are coming in from other areas, but from our degree, yeah, quite a few left.

Andrew Rocks
And so say, say you’ve walked out, you’ve got your financial planning badge, your RG, you’re all excited. It’s 2005 or six. Take me through how you’ve gone from there to overseeing one of Victoria’s in Australia’s the larger financial services companies.

David Moloney
Yeah, I look back now is a bit insane. But I was 22 and decided to start a practice. So it was my degree, started a financial planning practice, as well as a mortgage practice at the same time. It was the peak of the mining boom 2007. And the GFC was sent to follow after but a fascinating time. We saw a lot of the practices that struggled in that time, we’ve learned a lot from what not to do. So I’m forever grateful for starting at that time, even though you look back on it. And it was absolute chaos. No one knew what was going on ultimately. But as a young individual, it was really helped shape us going forward.

Andrew Rocks
And you mentioned you also started a mortgage broking business. Was that something that you you kicked off almost from the outset?

David Moloney
Yes. So we set up an office just on Khan Street, right near the legal precinct here in Melbourne. And the target demographic I was going after were viruses. The thesis there was they’re all self employed say they needed advice. There was no SGW obviously, for a lot of these people, and they need a lot of cash flow and debt advice. I’m still forever grateful for a good friend of mine. To this day, a gentleman by the name of Morgan McClay, he’s a barrister. But he really got me in front of a lot of barristers back in 2007. And there’s still a big part of our business today.

Andrew Rocks
And how did you get through the GFC? You mentioned that it was hard, but what were the things that you put in place? And was it potentially that you you had a fallback business or income stream in the mortgage side that that assisted?

David Moloney
Exactly, um, to be frank, we obviously hadn’t accumulated a lot of clients at that point in time was all organically grown. It was more a lesson in what not to do. And it’s sort of shaped the way we run our business today. And so we were able to avoid a lot of the mistakes, the mistakes I could easily see happen to most people. But because that happened to us at that particular point in time, it was a great lesson, but the mortgage business was thriving.

Andrew Rocks
What were some of the mistakes that you’ve you give me some examples of the mistakes that no doubt, you’re going to say? And everyone who’s listening is going to nod and go yep, I did the same.

David Moloney
Yeah, so obviously the big thing at the time was a lot of things like commercial property trust that became a liquid potentially promoted as being defensive when they weren’t having a clear cut investment strategy. What I did take away and what we do implement now is the ability to be nimble and to move quickly. And having the right structures in place to move quickly. I think a lot of advisors at the time, and this will be technology driven as well. Just couldn’t move quickly enough, even though they thought the right move was to take action, they just simply couldn’t do it. So that’s really important for today’s

Andrew Rocks
to move your property trust when they freeze them. Right. So I think we’ve all felt that that pain. And so after that, did you stay in Melbourne in the city? And did you stick with with with barristers, or what did your business evolve to? Yes, so

David Moloney
it was a one man shop. I grew that as much as I could. And then we were operating off an independently owned her AFSL. And a colleague of mine, Christopher guy was doing something similar, he was targeting more allied health professionals. We ultimately found that we’re doing similar work. And in 2011, we merged our practice and we created a business called avant garde financial services. And we really drilled into the wealth management, cash flow, debt management, and mortgage business, and also commercial insurance business.

Andrew Rocks
What do you mean by commercial insurance? David?

David Moloney
Yes. So outside of typically, home and contents, commercial insurance, which are things like business packs, all businesses require insurance, and I was putting together insurance programs for businesses rather than individuals.

Andrew Rocks
I think, you know, the financial planning industry has historically been excellent at life insurance. But General Insurance has been something that they almost left for the accounting fraternity to take cover off and spot on having having even just above average skills in, in working with your referral partners. At least what a goodwill. It’s as crazy as it sounds, you’re going to insure your factory every year. Sometimes you probably shouldn’t be insuring yourself at the same time. But you know, the way the priority is right in front of you. It’s something that gets gets paid for every year.

David Moloney
No spot on. And it’s extremely complicated when when you see some of these insurance programs being put together, and being able to place that risk somewhere. It’s a highly skilled profession, and something where you get a lot of nows and insight, but it’s, it’s a great business and a great business we still enjoy today.

Andrew Rocks
Now, you mentioned you, you sort of hooked up with Chris Scott is a great, you know, bloke, but effectively, it sounds like you’re both doing the same job. Right. So you’re both doing the same job. But what was different was, was the clients that you targeted, being legal and medical, and this is an engineering podcast. So how has the roles that you both have now evolved? And where do you find yourself today?

David Moloney
Yes, so fast forward probably a few years ago, Chris and I, we built out our business, and we merged with a group called JPH. And that was a 40 year business targeting pharmacy professionals typically. And what we found was there was a lot of common thread in the business. Every client was a business owner, professional, sort of business lines were very similar. Our roles today are very much managerial. We did running what we call a multi brand strategy a few years ago, we did some acquisitions. So we had the avant garde business JPH. We had a meeting Kinsey, which was a law firm. But ultimately, it became a bit too convoluted and confusing. And what we needed to do was to rebrand that was a 10 minute process. We had a lot of consultation. We had a fantastic group called at collective and agency that put everything together for us. could not have done it without them. And when went through a lot of names, ultimately settled on year alone. We think it’s a beautiful name. It ties into our roots as an Melburnians. But, Yara Is there a fantastic indigenous word for river and slow Um, we’d like to think that we go with the flow of our clients, and Lane, it’s a bit of a homage to Melbourne as well. But Lane also represents structure. And that’s what we ultimately give to our clients. We go with the flow, but we give them structure as well to help them achieve their goals and objectives. And so we love the name. We’ve got the collective group now under that one banner, the messaging is very creepy. And it allows us to go into the next realm. We did grow from approximately 30 staff three years ago, when you’re seeing it about 80. So we’ve had rapid growth under that known and that’s been a big part of it.

Andrew Rocks
Well, thanks for sharing the story about Yarra Lane, the name there, it’s an ensemble, we’ve recently made a change of name and a transition, and the emotional attachment and the rationale, there has to be buy in. I think the way that you explained that there is is a real sort of centering point, I imagine for whenever you’re interviewing new people and and for what you’re looking to achieve, and it’s probably also a part of a filter for any additional acquisition that you’re doing. So I thought I might sort of change up gears because the Euro lane of today, which is if you look the website up, you guys are unabashed, yeah, you’re targeted a specialist industry. That industry of Pharmacy has been hyper targeted. And just give us a bit of a feel for where you sit in the industry when it comes to advising Medicare’s and in particular pharmacists.

David Moloney
Yeah, look at ourselves. We probably are in the top two, three, in terms of service providers, nationwide, we believe, definitely in Victoria. For pharmacists. A big contingent, obviously, he’s part of the chemists warehouse group. But outside of that we are a big player. We did make an acquisition in the pharmacy, space, beeswax, which is a pharmacy, bookkeeping business, they solely take care of pharmacies. And what we hope to do is to keep building out our service offering to focus on pharmacists.

Andrew Rocks
And what makes them so good. What. So So you know, to have 80 people, you know, practice is a big practice. And to have one segmented target client base is a small number. Yeah, so what makes them so wonderful, they probably going to listen to it, you want to be nice.

David Moloney
Firstly, they’re fantastic people there. I mean, I think the one of its always chops and changes, but probably one or two in terms of trusted professionals in the community, hence why they’re typically justice of the peace. The great to deal with, again, they’re self employed, and they need a lot of advice. They tend to be extremely focused on their practices, and they need someone in their corner to ultimately help. So split that that’s always the key drivers, people that are willing to engage people that want to succeed. We’ve got a growth mindset, but also a willingness to serve. So that’s aligned with us as people and our business as well.

Andrew Rocks
And from an outsider looking in the typical pharmacy definitely has a medical professional aspect to it. But most pharmacists also have a range of other services that they provide within the four walls that you have to walk through. Everything from I’ve seen, I’ve seen post offices in there. I no doubt Darrell Lee seems to be a witch, which, by the way is awesome. But yeah, so effectively, they’re a retailer as well. So when you’re doing that, and that’s probably the complexity of bookkeeping as opposed to a standard medical sort of services industry is that is that they are effectively a retail operation as well.

David Moloney
They are they are and just like any business, you need to ensure that you diversify or have multiple income streams. And this is prudent business practice to have those other income streams.

Andrew Rocks
So just getting a bit of an idea of the of the practice you’ve mentioned this it’s at people strong. The component that you want to run and operate being the financial planning part of Yarra lane. How do you structure that? I mean, how many hours do you have? What what who do they look after? What’s kind of the, the way in which you run that because I imagine you’ve got a fair bit of efficiency and competitive pressure from your accounting division to get things done from your mortgage division. You know, everything’s interlinked, because as you mentioned, that one client has a continual requirement for those multi-discipline advisory points.

David Moloney
Spot on. So we say Is your prescription we’ve got eight hours. And within that we’ve got a support team of hopefully another eight. And so it’s a great business. One thing that’s in the DNA across our entire practice, and in particular, in the financial planning business is the holistic nature or view of all the advisors, or consultants. We do take a one view of the client, to help us manage that we use a bit of software called the astute will, it’s very neat, it gives a 360 view of the client, which every division taps into, doesn’t matter if you’re a mortgage broker, an accountant, a lawyer, a bookkeeper, we use that that service or that system to have a full view of the client. And it really allows us to identify things that are coming up, change since a liquidity event or small business CGT events, what are the implications? Because often these things have not just an accounting implication, that’s a financial planning, it did implication a legal implication. So we’re all well versed in treating the client as one, and I look

Andrew Rocks
at your business, and it very much is a circle, because when you get to the end, you start again, right? Because, you know, bad things happen. Life happens. Typically, where where’s the entry point? You know, is it the financial advisors also have the role of the first impression? Or does that come from the accounting business? The mortgage business? Or where’s the where’s the first entrance into this into this group?

David Moloney
Yeah, that’s, that’s a great question. And I think it’s a benefit of having a dynamic business. But people who have an accounting need, they set up a business, there isn’t a clear accounting need. And that’s where the first trusted advisor kind of comes in. Sometimes it’s from the mortgage business where they need a boy into a practice, they need to get their final instructions, right. The mortgage team could potentially be the trusted advisor in that instance, sometimes of financial planning, there might be a particular event, you know, sadly, someone might have a heart attack or something along those lines. But you know, we come in at that point. So it doesn’t really matter. Where that point comes in, it does literally come from everywhere.

Andrew Rocks
And do you feel now that you’re moved from a multi brand strategy to a one brand strategy? Do you feel that the, the feeling between the divisions of sharing clients faster of of teamwork has enhanced or is it something that you still need to work on?

David Moloney
It’s something we always probably need to work on. But we believe that is the key to our success. We’re quite good at it. We’re proficient at it and but we’re continually looking to improve that. One of our key core pillars is obviously the client experience and, and being digital first. So we’re working on a lot of things to help enhance that intellect relationship. For squarely who’s in our operations of our business, he’s got this concept of people saw the 90s movie, The concierge, we’ve got all these concierge just within each division. And they helped facilitate leads advice throughout the group. So and they kind of meet together as a group as well.

Andrew Rocks
Look, when when I have a business that focuses on pharmacists says they’re digital first, considering that pharmacists are the only people that can read Doctor scripts that I think the world has bloody changed. Spot on. So we’ll come back to prequel in a second because where he fits into your engine room across your business, because it is a unique story that I’d like to to flesh out. Just getting back to your advisers, you have eight hrs and eight support people. Are they running pods? Do they look after a certain number of family units? If you got, like people coming through at different age groups, give us a bit of a feel for the the how dynamic your teammates?

David Moloney
Yes, we did initially start with a centralized system. And we have moved to a pod system. What we wanted to ensure that as we grow, we still have a very personal relationship with our clients. And we didn’t want it to feel like our clients were another number. So we segmented the team into different pods where our clients got the same client services officer, same paraplanner same advisors and ultimately the same team managing them all the way through rather than having this centralized process. It also allows us to see realize how we can scale up if we need to, in breaking things up into pods, you get your ratios, right, you get your revenue metrics, right? We find that it’s really working well for us. So that’s something we’ve recently started.

Andrew Rocks
And so what’s your ratios? today? And where would you like them to be? Be very interested in that?

David Moloney
Yeah. So in the financial planning business, we’re hovering around you talking about profit margins, just

Andrew Rocks
numbers, they’re all smart cookies on here, they can work it out if they, if they think long and hard enough about it, but just just the ratio of the, the pods that you’ve got, and the the clientele that by number. Yes, spot

David Moloney
on. So we are pods are broken up into two advisors per pod, they share a paraplanner, they share a client services officer. And also there’s an assistant Client Services Officer. So that’s the configuration of each of our pods. We keep that works for us, and allows some sharing of resources, rather than having one advisor that ultimately gets one of everything. We think that works well for us at the moment,

Andrew Rocks
that the only way you’re gonna grow is is each one of those pods needs to be able to manage more people or you need to grow more pods. So where are you at both of those points?

David Moloney
You raise a good point, I think, yes, we can probably get more out of those pods. In our we recently did a staff survey. And one of the key things that were coming out of it was that they are probably feeling a little bit overworked, there’s a lot of volume coming through. So we are actively looking at ways of improving our efficiency. And one of them is automation. Where our staff can actually focus on more things for the client and the things that they’re less enthusiastic about doing. We do get robots ultimately, to do that work. So if we can get that right, I think we can get more out of our pods for sure.

Andrew Rocks
And I think the combination of technology and also people who’ve got scoped operational skills is useful. Now, how do you measure success with your with the reports what’s what’s what success look like? And by the way, you’re not Robinson Crusoe, when when people feel overworked, especially in the delivery of financial advice, or the engine room, we’re coming off 10 years of every every external piece of legislation, or we’re influencing financial planning is meant to baseball work for the same outcome. So I do hope we have a tailwind soon. But, you know, how do you measure success?

David Moloney
Yeah, obviously, there’s several things that we look at. There’s the commercial driver’s side, that’s something that keeps us all employed and coming to a happy place. But importantly, we do want to build a business that everyone is proud of. That’s something where we do want to promote, in the sense that do they enjoy work? Are they happy to refer our business to their friends, as an example, we can measure that success through surveys, direct feedback, but also our clients feeling proud of, you know, being associated with us and continue to work with us. There’s probably no better feeling than and we still get a kick out of it today. When you work with clients, and they ultimately say, you know, thank you, or a bit cliche, but it’s still what makes you get out of bed.

Andrew Rocks
I mean, it’s coming from a guy who picked financial planning as his degree. So this is not a Johnny Come Lately, kind of vacation for yourself. I’m really interested in how you deliver advice. So you’ve got a big business by a number. You’ve still got to be doing SOA Zaros you’ve still got to be you know, adhering to all of these things. Do you? Is it it? Is it completely in house isn’t out house? Do you? Do you have contractors? Do you know how do you run that that advice delivery, which is sort of the necessary engine to run the bit of the business which which cascades up and having a previous business it was multi-discipline myself, the amount of work that goes into getting $1 in financial planning, especially when you look across the fence to some of your other disciplines. You must just sort of roll your eyes in your management meetings.

David Moloney
Spot on. Yeah. Sometimes my business partners ask, you know, why can’t we deliver this a bit quicker and a bit more cost effective? them, they’ve got to see the components. And you’re right. There’s a lot to answer your question. Owl, our tech deck is probably expanding, we do use x plane. We see x plan and everyone’s different and keep up we see it more as a data house. Things like data feeds, having a central point where everything can be fit into the future for us dough is a lot of things will plug into x plane. A lot of things do communicate to that. And there’s a lot of bespoke specific bits of software that we can use to help with things like advice, production and client portals.

Andrew Rocks
Got any favorites, David?

David Moloney
We should wear a suit wheel is definitely one of them. We’re exploring that at the moment. We are also might be letting the cat out of baggy. But we’re also exploring my prosperity as something where we can enhance the client experience through their portals.

Andrew Rocks
And just a bit of hygiene. How are you licensed? You know, how’s that operate?

David Moloney
Yeah, so we were self licensed. But a few years ago, we gave that up and we’re licensed through interpack, who have been a fantastic partner, especially as we grow and we continue to focus on our business. To have a partner that accommodates taking care of a guest the compliance side of things for our business, it does really free up a lot of our time to continue doing the things that we’re trying to do.

Andrew Rocks
And given her Yarra Lane puts you firmly in Victoria, and having a background of being the most locked down state on Earth hours that sort of painted the picture of how you operate now with, you know, a single location, are you multisite do you have in? Do you have team members? Interstate overseas like what how’s it informed you? Because there is a special sort of camaraderie that I find a lot of Victorian firms on how they’ve harnessed and, and I would say they’ve almost front run it is this out of necessity, this movement into that, that work from anywhere. So we’re out of general lien position itself, right now. And where do you think it’s gonna go?

David Moloney
We’ve got staff in every state, unfortunately, not the territories yet. Our office locations we have, the main one is in St Kilda Road in Melbourne. We also have an office in Essendon, in the northern suburbs of Melbourne. But we do have staff all around the country, and every financial year and leading up to Christmas. We fly them all in and we all get together, which is fantastic. But to cultivate our culture and to ensure everyone’s kind of locked in and stayed all staying together. We do use platforms such as slack, which are great for building rapport with others. Plenty of video conferencing technology out there. We’re all well versed in that at the moment. But yeah, slacks been great. From that perspective.

Andrew Rocks
And given your and we’ll come, we’ll come to your team in a minute on how to run the people and and I just wanted to get a feel but every state is I suppose that there’s pharmacies in every state. So why not be aware of where your clients are? Do you operate? So given that you are multi disciplined? Do you operate a board? Or do you cascade up your information? If so, how does that work? And is that new or something you’ve always done?

David Moloney
Yes, structurally, we we do have a board. We’ve got a commercial partner and AZ NGO who provide a lot of great governance around that. It has really enhanced us as a management team to ensure that our governance is first class. We aren’t going to

Andrew Rocks
stop you for a second because the stereotype of is that nga is that they provide money but you’re just saying that, that it’s it’s taught you and your incumbent team a bit about how to run the business of the business. Is that right?

David Moloney
Yeah, exactly. I say this all the time. I’m an accidental manager. I’ve started as a sole practice and an individual and now we find ourselves managing 80 people. And is it really give us a fantastic lens into how good quality practices run I’m Roxy, you’re a testament to that as well. They give us the structure, the governance, our board really does make us accountable. And when things require scrutiny, they are scrutinized. Whereas in the past, something like that may never may never have occurred.

Andrew Rocks
Yeah, I mean when you’re building a business without a straightforward structure

so thanks for adding the adding that about the board structure when you when you’re growing a business, your board meetings had whiteboards in them. But when you got a business partnership, and you’re in charge of the hopes and dreams of 80 people, you have to pre prepare your documents, things like pre reading comes into a spot, right? Because time is precious. And on the engine, room podcast, we have people with multiple different iPS cells, but also multiple different ownership groups. And there is an emergence around people who are looking to tap into the bits, they’re not as proficient in whether that be governance and accountability, and bring to the table the things they are, which is you guys and having that hyper, hyper sort of targeted marketplace. So let’s talk about the people 80 of them. And, and I’m well aware that you’re at a here and you’ve got, you’ve got them all over the place. I would like to ask you a question. Why do people join you? And Yarlung? Why do they stay? And why do they grow?

David Moloney
Taller, timely question, because we’ve got direct feedback on this right now. I think a key part of our success is, and I’m glad to report this, but our management team probably doesn’t have a clear ego. So we’re quite able to adapt to our staffs, particular needs, we do run a hybrid office, which I think is particularly important to a lot of people now. Our management group is typically around 40 years of age. And we have staffs on either sides, we sort of feel like we sit in the middle. And a lot of our staff do have families. So flexibility is really important to them. I think that’s been a key part of our success. And I think also the willingness to hear feedback, implement stayed back, we understand we’re all not perfect. So they’ve probably been the big things. And I think as our staff have referred us to other people.

Andrew Rocks
And you mentioned that the hybrid principle. So we all got thrust into that overnight in 2020. When you’re recruiting new people, is it one of the things that comes up regularly when you’re searching for talent? Yeah, so is it?

David Moloney
Yeah, it is spot on. At the same time, we don’t lose focus of we are a client service driven business. So we’ve got to operate in a way which assist our clients, but we are more than willing to accommodate a flexible working arrangement. And there wouldn’t be too many people in our office that can five days a week, for instance.

Andrew Rocks
And the culture tether, or the that you use is via the Slack channel, is that right? So your Slack performs a an operational role in the business, but it also performs a socialization and, and peer to peer learning. Is that Is that correct?

David Moloney
Yeah, that’s right. And we set up a lot of different groups. One of the things that we try to promote is gratitude. It’s one of our values, and we’ve got a kudos channel. So whenever someone within our business does something, well, we want to call it out and let everyone know about it. So

Andrew Rocks
give me an example of the most recent one day with this and kudos for the kudos channel, what would be an example?

David Moloney
Yes. So this is the general innate attributes. Some typical examples, someone’s done a fantastic job of often, much, for instance, our solicitor and our mortgage broker will be working on the one file together. And one of the other professionals will highlight that another professional did a really good job, and they were impressed for whatever reason, and that would happen daily. Right. So that kudos channel is something that really gets utilized a lot. And

Andrew Rocks
given that you have that you are one business ostensively and from the clients perspective, you’re still four or five have different professions, different disciplines, different historical educational journeys. How do you arrange that? The business of, of meeting rhythms? So firstly, for what kind of meeting rhythms Do you have within your financial planning business? And potentially if if you do, how does that cascade into the overall business? It’s?

David Moloney
Yes, one actually, that’s a really good question because you could have anniversary dates across multiple businesses at different times of the year. So that’s actually something that we’re looking to consolidate, especially knowing that our clients are extremely busy. We do try to the best as we can to match up things like a tax meeting with a financial planning, meeting and having what we call common renew dates. But that is something we are working on, because you’re right. Some clients might have four or five meetings throughout the year with different divisions.

Andrew Rocks
Yeah. And their time is precious, too. And it may do that I’ll do a segue into it. Tell me about Tell me about your business partner, a Pasquale, who’s coming in via beeswax and just a bit about what his background was in what he’s doing in the business that’s helping you get those common renewal dates and join the business together.

David Moloney
Yeah, so Pasquali. Obviously, he is the head of our bookkeeping business. And he is a highly process and well drilled individual and his business or the business is efficiently run. His background is actually in pharmacy. He was a pharmacist himself, you’ve owned his own pharmacy practice.

Andrew Rocks
Like a Trojan horse.

David Moloney
Yeah. Depends on how you look at it in a good way. But he, he actually had a real scare. He had, I believe, a heart attack. At a very young stage of his career. My other business partner, Nick Perret, was his visor at a time. He encouraged him to get trauma cover. He got paid out on that travel. But Nick literally stepped into his pharmacy and kept the doors open and made sure the staff were paid stuff was coming through. And I guess that’s one of those things where if you are community orientated, yeah, people will sort of feel a little bit indebted. But that was a bit of a wake up call for Pasquali where he felt that he wanted to do something different. He had this great idea of setting up a pharmacy, bookkeeping business. And this has grown. Remarkably, he’s got about 200, pharmacies now. Wide. And he’s done it in a very short period of time. And

Andrew Rocks
just just on that, one of the things that you’ve you highlighted was that Nick was was prescribed advisor. And just the, the power of being insured properly. You know, when we start, we are in financial services. And so can you remember, if you’d like to can remember who the company was? Who actually paid out on the on the trauma cover? Is that knowledge to you or not? Yeah,

David Moloney
a missed opportunity here, I’m not quite sure who the insurable was a big shout

Andrew Rocks
out to the insurance who are listening. Okay, Scott, on the cover, done well, has not only helped this dispersed in his family, but it’s been around and I’m sure that you guys generate a fair bit of insurance inquiries in your day to day so. So it’s, it’s been a bit of a paid it forward moment for the for the insurance there. And just why I’m on that. Although you don’t focus tremendously on you know, being a specialist, investment manager and whatnot, I still want to ask you, how do you run your investments? Do you do? Do you have an MBA and MBA at SMA? And do you have any platforms that sort of work for you?

David Moloney
Yeah, we do. So we went on the managed account journey, about five years ago, and we were looking to, in touching on earlier in our conversation around the GFC, and so forth, but I never wanted to be in a position where we didn’t know what was going on. Again, right. That was a key driver for that. And then we wanted to engage on as a consultant, and we did establish around four years ago in MDA and we’ve partnered with our phylo capital And we at that time appointed, and still to this day is also consultant Drummond capital. We were actually their first advisory practice many years ago. And they’ve in a climate where so much has changed in the last few years having a robust quality investment process. We’ve just never looked back. A client’s give us feedback every day at how fantastic it is. And, yeah, we’ve been, it’s been a great journey.

Andrew Rocks
Safe to say if you’re running at employees, the last thing you need is to also have pain around double handling and running the investments as well. So a shout out to the Philo capital in the in the drama and people who were helping our power the airline. And a question I like to ask also is, you know, what are the lessons you’ve learned? I think it is, you summed it up, you know that what the GSA taught you is that you you can’t set and forget, and you need to be nimble, because that’s what your clients are paying you for. And moving to an MDA that many years ago and employing professionals, no doubt has assisted you, with your clients can review time. But also, as you say, it probably gives them a bit more sleep at night, because they know that you can be quite responsive, if anything’s happening

David Moloney
exactly. In just structurally, it’s a different mindset when an asset a consultant is accountable to a business, right? In a world where you know, you get given what you’re given with a product, the dynamics completely shifted here, they know that they have to deliver on their mandate in order to maintain the mandate, right. And they’ve been doing such a fantastic job. And that’s where I just and this is probably becomes more and more highlighted in our minds around governance, but having the right governance in place, where we can structurally change things on behalf of our clients as custodians of their wealth and their financial positions. We’ve got the right governance in place and getting the right people managing our clients money.

Andrew Rocks
The way you’re alone is today is that you’ve, you’ve somehow got four or five different businesses that have come together, got the common name, it mentioned that people like you got like your team like you because there’s a perceived lack of ego. But you survived $1, every time five self made people came together to try and to try and run that. It will congratulations that you’ve got this far. But if you guys are all in your early 40s, which is the average age of a financial planner these days, what’s the next step? Have you got a plan to bring team members in all the different disciplines through? You know, do you have any employee share scheme does, you know, now that you’ve you’ve managed to somehow or still talk to each other under the common thing and actually flourish? What’s the next steps for you guys structurally? And how do you think that’s going to be implemented?

David Moloney
Yeah, we touched on it slightly before, but we’re establishing our corporate pillars at the moment, which are all aligned to our corporate values. So our corporate values are centered around curiosity, simplicity, integrity, and gratitude.

Andrew Rocks
So curiosity, see simplicity, integrity, and gratitude, gratitude. Let’s start from the top. Yep, spot

David Moloney
on. So the reason those things are important to us is because they strain the type of business that we want for the future. We don’t want something about us, we want our business to be its own entity, its own beast in its own right. And within that, those days, we’ve established four corporate pillars, which is the client experience, Digital First, operational excellence and people and culture or people in community rather. And within those pillars, we’ve got a whole range of initiatives that we’re looking to roll out. It’s about prioritizing them right now. But in terms of people and community, we’ve got a staff member, he’s a young solicitor niche, he does fantastic work for us, but he’s got a a side dog charity. So we’ll be looking to support that. Our initial thoughts are our pharmacy client base, do a fantastic job of helping out the elderly, typically. So we would like all areas covered so we We’ll make a push into helping out children and underprivileged children. That’s really important to us as well. But this is something that’s forever evolving, and we’re looking to roll that out. But we need to get these corporate pillars off. So now it’s

Andrew Rocks
all right. And when did you get these pillars? Because sometimes, without direction and priorities, it is just, it’s just busy and crazy. And how long have you had the pillars? For? Did anyone help you on that journey?

David Moloney
Yes. So a good friend of mine, from KPMG, has indirectly assisted us through this process. We felt that it was really important to get this right now. Because as we continue to grow, to potentially 300 staff, that’s going to be a very hard ship to lose, if we haven’t got this stuff right now. So we’re at a nice little moment in the evolution of our business where we can really get this right,

Andrew Rocks
absolutely, I can tell you, you get you get capacity constraints at around 10 people in a business, because up to 10, the charisma of the lead, the lead singer can can drag it forward. And then you normally have a crisis of confidence around that 30 When the lead singer realizes no matter how much revenue they may write, they’re still gonna pay bills, and you need to do it. And I think that potentially, your grouping has leapfrog that 30 capacity hurdle by by bringing in the smarts of the ASA team, but also bringing together the four or five pillars. But if I put my VBP hat on, the next one is 103 100. And what gets you there doesn’t get you forward after that. Of course, words matter, the bigger you get, and your ability to communicate. And you realize that, that when you speak to it to anyone that lots of people are analyzing you what you’re talking about, so So the Corporate Communications internally, is arguably more important than then what you say to the clients, because the clients end up being the fixed part of the business, and your own team end up being the variable. It’s funny how that switches. So that’s this might my anecdotal kind of thing. And, and you know, we’d love to see you guys get get to 300. Now, when when you mentioned that you’ve do surveys, you’ve got charitable programs. It sounds like you’d be a classic candidate to put yourself up for the great place to work in Australia. Is that something that you guys have looked into?

David Moloney
That’s right. So that’s one of our initiatives that we’re putting together. And we have never done it before. So we’ll go through that process. So you’re doing it now is that we sign up? We’re about to Yeah, so that’s simple. squalling. Pasquale would drive. So that’s very exciting.

Andrew Rocks
Yeah. Well, as someone who has campaigned for the process, it’s awesome. Okay, right. Ryan, our show on it, some, it. You know, you mentioned the word accountability. It’s all good. And we’re having accountability on the numbers. But if you’re not accountable for the people, then you’re in trouble. And I think you mentioned that you did a survey and people are saying they’re a bit overworked. You know, if I had $1, that’s kind of I think that the most people engaged one of my other businesses, which which supplies global talent, because they think that we’re going to be able to do a lot more things for them. But the first step is actually we just helped their existing people, you know, get their workload under control and avoid them, kind of sending you the Dear John letter, which is, which is terrible, because you’re not to lose, you know, the real smart, so. Yeah, exactly. Good. Good luck with that one there. And when I wanted to also just just go back to when you’re recruiting people, so Are you actively recruiting people at the moment to get into business?

David Moloney
We are. So we’re always on the hunt to great people. I know. It sounds too cliche.

Andrew Rocks
Well, no one’s on the hands of bad people. So it’s never been said in this in any forum say, so. There’s something happening.

David Moloney
Yeah, exactly. And what we often find is when you need someone, it’s often hard to find him at that time. So we’re constantly on the search. Okay, and we’ve got a bit of a database that we’re kind of putting together in positions that we think needs filling. We are looking for, for instance, and associate at the moment in the wealth management business. Just to help with a bit of the workload, and potentially one day helped establish a new pod, right. So we do have a bit of an evolution there where we invest in some our graduates and we’ve got a great team of young graduates. Coming through. But yeah, the pursuit for, for talent. It’s ongoing. We don’t want to be reactionary when we’re finding people.

Andrew Rocks
Oh, yeah. Well, that’s That’s the million dollar question. And having graduates coming in, look, you’re gonna do yourself a lot of favors if you’re, if you’re adhering to, you know, those pillars of curiosity, simplicity, gratitude. The hierarchy or requirements of why people work is, you know, money is one of them. But it’s not the only thing. You mentioned the environment, the way in which you interact with everyone. We’ve mentioned, I’ve asked a few other questions, but when you actually do succeed, how do you reward yourself? What’s fun? And Caroline? How’s that work?

David Moloney
Yes. So we do have some fantastic social events within the business, and are tying in with our reward. But it seems like we have airfryer Wednesdays, you know, the staff get together, they all bring in frozen food, and we get it into the air fryers. Every couple of months, we get a bit of a get together, where we put on a few drinks, and we socialize, but yeah, look, it’s been a fantastic start to the year and we’re looking to take the staff to a winery, which will be fantastic. So I think sharing the success will be really important. That’s how we celebrate. We do have a bonus share scheme, as well. So we’re just trying to tie everyone into what we’re ultimately trying to do. And sharing the spoils and sharing the success. Yeah, sharing

Andrew Rocks
in the game. So does that mean that you’re relatively transparent with the financials across the group in different topics?

David Moloney
Yeah, we are becoming increasingly transparent. In a sense, sometimes too much detail can be, we think that we live and breathe the numbers. Sometimes people just want the high level stuff. So we’re just trying to get the messaging, right. But we’re trying to be as transparent as possible. And I think we just got our staff get it when they understand what’s going on.

Andrew Rocks
And one thing that my business coach, now business partner, Dave Carney implemented in in a business was the great game of business, which is not a new scenario. And it’s, it’s kind of where you share that the numbers, and people get a share in the profits over and above the requirement. What’s the outcome, but the process is that the different people in different divisions own a line in the p&l. So if you’re on the revenue side, you aren’t alone. And that’s pretty typical. But also, if you’re on the cost side, you own a line as well. And so although, you know, when you add up all those lines, there is a lot, the reality is each individual’s only really focused on the thing that they can control. And, you know, if you haven’t looked into that, I’d recommend just just sort of looking that up and, and rolling with it, because it’s made, it’s made a big difference, mainly to the people on the cost side, because historically, they’ve been left out of these kind of conversations, because, you know, it’s been all about the top line. Right? So, yeah, it’s been some, I’d say, Now, given your, you know, your 20 odd years, I think you started uni in 2003, you’re 20 ideas into this, you’re not a spring chicken anymore. But you’re still looking at, you know, what, which which I don’t want to podcast, everyone gets a real, real feel for how people are looking. And your clients are not a passing fad. You know, the aging of Australians and is going to call for more and more sort of assistance in pharmaceutical. And there’s no doubt that if you wanted to pivot into other allied medical areas, you have the credibility to do so. So you know that you keep that up your sleeve. But what’s what’s your business vision for the future? Because this podcast is very much engine room Practice Manager. And I’ve spoken to quite a few people and some people have come through the administration side of a practice that and they’ve they’ve ended up being head of operations, then jam, or Pim, and some people like yourself have come from the advisory side. Is it something that, you know, where do you see the future for practice managers? And it’s just a big gap in whole industry around, you know, training, grooming, mentoring people for that role.

David Moloney
It is, it’s in terms of the commonality amongst those people or I’m not sure what that is just yet. We like to think we we avoided things like timesheets because we wanted our staff to be collaborative and have this real culture of helping each other out. I think internally we are sourcing a lot of octopus managers really holistic, willing to assist style people. We don’t exist unless we have those type of people. So we’re looking to expand one, flesh that out as much as possible in terms of the future.

Andrew Rocks
And do you think that that doesn’t matter? Does it matter if they’re mortgage base or illegal? Or is it? Is it more just around how they arrange themselves and communicate

David Moloney
spot on and our business is full of people that where it doesn’t matter what your background is, you can still play a role in that practice manager position. I don’t know how to use a probably a corny reference, but it’s probably a bit like the early explorers, you don’t quite know how it’s all gonna look. But you know, you’re probably on the right path to somewhere. But yeah, for as long as we keep investing in our people, I think we’ll get the right mix of individuals.

Andrew Rocks
And you’re alone feels like it’s been a lot in the last three years, and you have had COVID at the same time. But if if people are out there listening, what is the specific, you know, are you guys, you mentioned that you’re in the market for it, you said practice management, you have a bit of a history in bringing graduates through. So that’s obviously in their P Y, et cetera. Are you interested in more acquisitions? You know, what’s what’s kind of? Where do you sit right now and apply for one listening to this? And I liked what I hear. Yeah, what’s, what’s the appetite at the moment for the airline.

David Moloney
Yet, look, we’ve grown through acquisitions. And our focus at the moment is on the operational side and making sure everything’s bedded down and everything’s running as smoothly as possible, then we will look to go again, and continue the acquisition. So we are always on the lookout. And as you probably aware, Roxy, these things don’t happen overnight. So you need to have those conversations now, with people. So we have been in discussions with purposes. And that’s been something that we’ve always done. So we are definitely looking for businesses that align with ours, we’re not solely pharmacy related. We bought a high net wealth business last year. And they’ve been a fantastic part of our business. And what we’ve actually found is that they get a breath of fresh air where they come into a bigger practice, that’s multidisciplinary. I think financial planners, by nature, a holistic in their thinking, and they’ve got this ability, which they’ve never had before, to actually assist in different business lines, and really get great outcomes for clients. So we definitely are on the acquisition path. It’s just about finding aligned businesses,

Andrew Rocks
it culturally aligned and, and what I liken it to an old borrower, a purely Melbourne phrase is that there are a lot of Formula One drivers out there of people who want to talk with clients. But if you if you don’t have a pit crew, that when you pull up, put all four wheels back on, if you don’t have the ability to be multi disciplined, then then then it’s more difficult to service that, notwithstanding that they’re there, you know, what my observation out there in in practices are, but a lot of practices that achieved the same result by being hyper, hyper specialized, and, and referring to other businesses, which which, and there are a lot of businesses that are sort of coming at from your perspective. And I think the people that struggle, the ones that are in between, where they haven’t worked out that they want to be hyper specialized, or they haven’t worked out that they need to collaborate, is that a sentiment that you would share?

David Moloney
Spot on, and we were there. So we were a bit in no man’s land. So we wanted to ensure that we did give this a good crack and continue to grow, but really hone in on our specialities, which also includes barristers. And you know, every six months, we give a new young barrister a grant, and we run that every six months. And we want to continue doing those type of things within our client demographic. To continue to hone into that those specializations but also build a corporate profile that attracts other businesses and other people to join us.

Andrew Rocks
And before we finish up, you are the consummate a modern day professional where we are Thank you very much. You’re doing a podcast on your way to a wedding. You’re doing this in an Airbnb But he informed me that you go to a board meeting that will probably be conducted via via the internet in the carpark so, you know, this is this is financial advice in in 2024. David it’s been it’s been a pleasure to unpack the Yarra Lane story, it’s been, it’s been an eye opening the speed with which you can come together and the size. That figure of that ambitious figure of 300 people in your group would would make you guys one there are there abouts one of the larger sort of practices in this country and I wish you and all of your team, you know they are listening to this on behalf of myself and ensemble in the engine room podcast. All the best. Cheers. Thank you very much.

David Moloney
Thanks, man. Thanks Rocksy. Cheers.