Sam Tate, director of strategy and growth at New World Financial Group, talks to Damian Fantato about how he came to set up his firm with its charging structure and why he is confident it will work.
"Having worked in a traditional firm for a long time there are some things that I was growing a little bit frustrated about. Lisa, my business partner, shared those frustrations as well.
"As we have seen financial planning develop with technology, like cash flow planning, it has opened up the opportunity for what a financial planner can be. At the same time there are some existential threats through technology and demographics.
"So there is an opportunity to make financial planning the product. For me, that is the way this industry survives and thrives.
"Technology will remove mediocrity and the best will use it to their advantage. It will allow us to do our jos better and faster. We will use those tools to provide absolute quality and to improve people’s lives.
"Also technology is deflationary by its nature. Advice is going to get cheaper, planning is going to get cheaper. You make money by diversifying and improving the quality.
"We set up the company in 2019 and launched it in 2021. Most of that time was back and forth with the FCA.
"Our charging model evolved over time. We didn’t have it in on day one but we were playing around with our brands.
"We had this idea of what we wanted to do and it was thinking about how to achieve it. Initially we had that link to an investment amount and when we removed that it was almost freedom. We could do anything. It was simpler.
"There is no money focus at all now. Some clients may not have any savings but they might need tax advice. We now have a situation like any normal business: the clients pay for the service they are getting. That is how it is in any other walk of life. It removes the link to how much money someone has.
"A lot of people ask me how we are going to make it work but it is not our only income stream. We go into businesses and offer them financial planning to their employees. We see more and more businesses wanting to offer that as an employee benefit. It is about thinking bigger than any one traditional income stream.
"We have spent a lot of our own time and money giving free seminars because it jived with what we were doing and it gets us in a room with 10, 20, 30, 40 people. That's a luxury you can afford when you don't have many clients.
"We have got well over 100 clients now. We have been going through solicitors and accountants. Referrals have been one of the biggest ways of getting new clients.
"We also know that we have to make our processes faster and slicker, particularly for the younger clients. We also have to offer them online meetings rather than face-to-face.
