A Better Business Model – working with an ICPM

By Jerry Butler

Consider the following trends in our Industry:

  • CRM2 and a movement to a fee based compensation model
  • In fact a movement to 100% transparency of ALL client costs including those of the manufacturer – mutual funds, proprietary products, etc.
  • Downward pressure of fees / commissions and increase in Dealer split and fees
  • Smaller advisors are being hammered by Dealers
  • Increasing AUM becoming imperative

Consider the evolving expectations of clients:

  • Clients are expecting Holistic financial planning including estate and wealth transfer
  1. Expect more advice from their advisor for less fees
  • As clients age they are expecting their family to become more involved with the decision making process
  • Business owner clients expect their advisors to be involved with the succession planning process of their business

Advisors? Keep up with changes or risk losing the value of your business:

  • Increasing costs – declining revenue streams – more demand on time
  • Selling all products to all people no longer a viable or valuable business model
  • More technology needed to keep up
  • Traditional sales / prospecting methods don’t work


  • Specialize in one product and/or change business model to a Wealth Manager
  • Work with specialists – Portfolio Managers, Insurance Specialists, Accountants and Lawyers etc (some even have Chartered Business Valuators work with clients for succession planning)
  • This business model gives the advisor more time to develop relationships with clients and prospects and achieve all the objectives of CRM2 and the evolving expectations of your clients

Benefits of working with an Investment Counsel Portfolio Manager:

  • 100% transparency of fees
  • Possible direct tax benefits
  • ICPM responsible for KYC, risk assessment, paperwork, etx.
  • Fiduciary responsibility not just appropriate product recommendations (Big difference and a huge selling feature for clients)
  • All investment products available including risk adjusting private equity investments
  • ICPM s have both education and experience requirements that advisors do not require PLUS need provincial securities regulator approvals
  • Advisor does not have to be licensed with a Dealer

Queenston is working with KAI Asset Management at http://kaiasset.com/

KAI differentiates from other PM’s in the following manner:

  • They give their referring advisors more latitude in account size and portfolio fees
  • Share fees 50:50
  • Develop a personal relationship with referring advisors
  • Make opening accounts with clients very easy for advisors
  • Info about the Portfolio Managers at http://kaiasset.com/founders/
  • For those advisors committed to a long term relationship with KAI they may also offer the following:
  • 4 – 5x recurring revenue to advisors exiting their business;
  • Develop a matching program for young advisors and older advisors for a continuation plan and an exit strategy;
  • Monetize your business with a 20% of the value tax deferred “deposit”;
  • Share purchase plan;
  • A buyout if you get hit by a bus
  • Check out their portfolio design process at http://kaiasset.com/core-portfolio/
  • The Advisor Tool Kit is at http://kaiasset.com/advisor-partner-program/

To discuss further how a transition to a Wealth Management business model can greatly benefit you and your clients – give me a call or respond to this email.


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