Many financial advisors as well as many lawyers, accountants and other professionals are focused on providing their services and products to the wealthy. With the significant and continued growth of the High Net Worth (HNW) market coupled with the wealthy willing to pay – and pay well – for value, the number of professionals focusing on their service is growing rapidly.
For most professionals, the appeal of working with the wealthy is manifold. Yet, without a doubt, a very powerful appeal are the monetary rewards that are possible.
It takes a lot to be able to deliver exceptional value to the wealthy and thereby build a highly successful HNW practice. Topping the list is being an expert in your field. Moreover, your business model is substantial. However, these two factors, although absolutely essential, are rarely enough.
For most professionals, the biggest obstacle to building a highly successful HNW practice is business development. Your ability to connect with high net worth prospects who become high net worth clients could quite possibly be the hardest part of your professional life.
Many resources are available to help you become more proficient in HNW business development. A well-used resource is HNW business development coaching which comes in many forms with various methodologies. Here, I won’t go into the different systems and processes that can help you become more effective in cultivating HNW clients. Instead, I will outline three types of HNW business development coaching models.
Three Models of HNW Business Development Coaching
By talking about HNW business development coaches, I am referring to professionals who, for a fee, share their expertise with advisors so that they can develop HNW practices. To be clear, all counselors looking to develop HNW practices need the services of coaches. Many counselors are able or prefer to build their HNW practices using other resources from various educational programs to participate in study groups at their own initiatives.
The three HNW business development coaching models we will discuss are:
Pedagogical support: Your coach gives you insight into HNW families and often various types of referral sources. He or she is a teacher who explains the methodologies that will enable you to connect more effectively with HNW customers.
Situation specific coaching: Your coach works with you on specific business development situations. You detail a set of circumstances and your coach guides you through potential ways to achieve your desired results. For example, you can discuss the best way to make investment recommendations to a committee of wealthy family members. A common circumstance is when your coach helps you match high-impact solutions with the personal interests of a prospect or wealthy client.
Participatory coaching: Your coach partners with you to help you better learn the systems and processes that result in new HNW business. Your coach will also work with you on certain situations. In these scenarios, your coach is part of your team and is periodically in direct contact with HNW prospects, clients, and other professionals.
The three models are not exclusive. In many ways, they actually build on each other, with instructional coaching being fundamental. It is not uncommon for the three models to mix. Additionally, many HNW business development coaches offer all three models.
Comparison of the three HNW business development coaching models
The ultimate goal of all three models is to help you develop a more substantial HNW practice. When it comes to business development coaching, the results are evident. Have the coach’s methodologies translated into more HNW business for you? It’s not about how you feel or even your state of mind. The value of your Coach is clearly visible in your revenue figures.
Keep in mind that the best coaches make themselves redundant in many ways. Unless you change focus and focus, over time your HNW business development coach should become useless. One of the main end goals of your coach is the transfer of knowledge and skills enabling you to build a growing HNW practice on your own.
Pedagogical support: Your coach acts, most of the time, as an educator sharing an HNW business development methodology. Generally, the information is one-way from the coach to you. As such, a coach’s level of involvement tends to be low. The cost of educational coaching is either a program or a retainer fee. Compared with other models, the cost is low but you bear the economic risk. Also, with this approach, only you decide if you want to pay for this type of coaching.
This is the most common model of HNW business development coaching. It can be provided to large groups of professionals as well as one-on-one. While there’s a lot more for you to do when it comes to implementation, it’s usually a great way for you to learn about an HNW business development coach’s methodology.
Situation specific coaching: In addition to providing training in some HNW business development methodologies, the goal is for you to review specific cases and opportunities with your coach and, with their help, determine a course of action. This coaching model is what most professionals tend to think of when they think of coaching. Comparatively, your coach is moderately involved compared to the other two models.
The cost of this type of coaching is higher than the previous model and often much less than the next model. You pay a program or retainer fee. And there is rarely any transfer of economic risk. Again, you only make the decision whether or not to hire the trainer.
In both of these coaching models, you need to take what you learn from your coach and apply it in order to get the results you’re looking for.
Participatory coaching: Here, your coach works hand in hand with you to develop your HNW practice. He is heavily involved in participating in the trenches by your side. In many ways, your coach is your partner, eventually using their methodology with potential prospects, customers, and referral sources to help you deliver greater value and achieve greater success.
With this coaching model, you learn and become much more capable by replicating how your coach gets results. These coaches are compensated through program fees or honorariums, or – in very well-defined situations – through production, or a combination. Due to the relatively intense level of involvement, the cost is consistently higher than the other two coaching models. For example, monthly installments of $10,000 to $40,000 and sometimes more are quite common. At the same time, you can transfer a large part of the economic risk to the coach. So, if you’re not generating much more targeted income, the cost of coaching is greatly reduced and may cost you nothing. Plus, if the coach really overloads your HNW practice and you exceed your target earnings, you pay more.
When it comes to this type of coaching, coaches tend to be very selective about which clients they accept. Since success is clearly defined and regularly linked to the remuneration of the coach, only the most suitable candidates are selected.
If you want to create a much more successful HNW practice, you might want to consider hiring a coach. The best HNW business development coaching model is up to you. It’s based on where you are today and what you want to achieve. Additionally, the speed at which you want to achieve your business goals is often a major factor. However, none of these three patterns work unless you make them work.
Probably the biggest obstacle to benefiting from high quality coaching advice is when professionals don’t follow the advice provided. For example, many professionals want to move upmarket but do not consistently apply what they have learned. And, most of the time, coaches have no way of changing that. So ultimately your success is always up to you.
RUSS ALAN PRINCE is executive director of Private Wealth magazine (pw-mag.com) and chief content officer for High-Net-Worth Genius (hnwgenius.com). He consults family offices, quick-and-rich entrepreneurs and selected professionals.
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