Ep 388: Transitioning To Independent RIA With Only $7M Of AUM To Turbocharge Growth With Website Local SEO with Freeman Linde
Jun 4, 2024
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Freeman Linde, cofounder of La Crosse Financial Planning, discusses launching his RIA with $7M AUM, utilizing local SEO for rapid growth, and offering lower client costs. Topics include transitioning to independent RIA, strategic client-conversion approach, local SEO acceleration, and expanding service offerings for recurring revenue.
Transitioned from $7M AUM to Independent RIA for rapid growth using local SEO strategies.
Overcame compliance fears by partnering with consultants and proactive compliance approach.
Optimized tech stack with eMoney, Schwab, Advice Pay, and Microsoft for cost-efficiency.
Implemented tiered AUM fees and progressive fee schedule to attract diverse client segments and align incentives.
Deep dives
Transitioning to Independence with a Different Approach to AUM
After starting with just 7 million in assets under management (AUM), the financial advisor discusses how he transitioned to his own registered investment advisor (RIA) to maximize growth and profitability. By optimizing services and fees, leveraging local SEO strategies, and focusing on existing client relationships, the firm saw exponential growth from deliberately lowered AUM fees while maintaining personalized service for each client.
Navigating Compliance with Confidence
The financial advisor shares insights on overcoming compliance fears associated with transitioning to independence. By partnering with a compliance consultant and demonstrating a proactive approach to compliance, the firm gained confidence in interactions with auditors and regulators, turning compliance from a perceived obstacle into a supportive resource for business sustainability and growth.
Customizing Tech Stack for Efficiency and Cost Savings
Through careful selection of tech tools like eMoney, Schwab for portfolio management, advice pay for billing, and Microsoft for various needs, the advisor crafted a cost-effective and efficient tech stack. By leveraging the flexibility of independent solutions over predefined broker dealer offerings, the firm eliminated unnecessary costs and streamlined operations for improved client service.
Strategic Fee Structure for Client Value and Growth
The financial advisor outlines their fee structure, consisting of a tiered AUM fee that incentivizes higher net worth clients and minimizes the impact on smaller accounts. With a monthly minimum fee of $300, the firm ensures accessibility while optimizing revenue potential and attracting diverse client segments for sustainable growth.
The Shift to Progressive Fee Schedule and Incentive Alignment
Transitioning from a traditional one percent fee to a progressive fee schedule, the focus was on incentivizing growth without taxing lower-value clients disproportionately. This shift aimed to align interests by ensuring no sudden fee drops when clients hit a specific asset threshold. By charging more upfront for detailed financial planning work, the firm sought to cover expenses and maintain an alignment of incentives for mutual success.
Innovative Client Services: Estate Planning and Tax Assistance
Delivering comprehensive estate planning solutions by leveraging advisor-facing platforms for document creation, the firm streamlined the process for clients with basic estate planning needs. By offering essential estate documents at a bundled flat fee, clients benefited from cost-effective solutions to avoid probate and ensure efficient wealth transfer. Incorporating tax expertise into investment decisions provided a unique approach, enhancing client value and service quality.
Strategic Growth and Niche Focus
Emphasizing targeted niches for client segments, the firm saw accelerated growth by tailoring services to specific demographics. With distinct advisors specializing in different niches like pre-retirees, medical professionals, and younger clients, the firm captured diverse markets effectively. Leveraging SEO strategies and separate niche websites, the firm attracted clients through targeted searches, fostering trust and specialization in financial planning services.
Freeman Linde is the cofounder of La Crosse Financial Planning, an RIA based out of Wisconsin that oversees nearly $50 million in assets under management for 73 clients. Despite industry norms suggesting the need for tens of millions in assets to go independent, Freeman launched his own RIA with just $7M in AUM, shared with a business partner. Leveraging the freedom to create an SEO-optimized website tailored to their local community, they rapidly expanded the firm to $40M in less than four years.
Listen in as Freeman shares his strategic decision to operate as an independent RIA, utilizing a custom spreadsheet to analyze and favor the financial benefits over traditional broker-dealer models, including flat-cost expense management and the ability to offer lower client costs while raising AUM fees. He also discusses how adopting a focused local SEO strategy and creating distinct websites for niche markets accelerated his firm's growth, as well as his effective client-conversion approach. You'll hear how expanding his service offerings has solidified client loyalty and supported a sustainable business model that prioritizes recurring revenue over constant new client acquisition, inspiring newer advisors to start in fee-only environments.
