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How advisers are solving problems with side projects

Three advisers share their experiences of extending their offerings alongside their day jobs

It is often said that to have a good business idea you need to solve a problem. So what problems are innovative advisers attempting to address with side projects that run alongside their day jobs?

The fund

Wealth & Tax Management managing director Tony Byrne is preparing for the February launch of his first fund, Intelligent Wealth. Disappointed that many actively managed funds are “closet trackers” and that transaction costs from high portfolio turnover eat in to returns, he wanted to create his own proposition. His idea is to have a wide remit, with the freedom to invest “intelligently”.

“I see eight major investment themes for the future. We feel these are the best growth areas, so why invest in anything else? We created a ghost portfolio of shares and the back-tested past performance over the last 12 months is 43 per cent. Over the last five years it is 24 per cent a year on average.”

The themes include robotics, 3D printing and microchips. He says: “We’ve had microchips in computers for years but we are now getting them in other equipment like fridge freezers. Everything is effectively a computer and demand for microchips is going through the roof.”

Tony Byrne: The FCA must put a stop to hidden charges

Acknowledging the work that has already gone on behind the scenes, such as the long search for an authorised corporate director for the fund, Byrne does not anticipate having to throw a lot more resources at it once launched.

“It will have over 80 per cent in ETFs and the rest in investment trusts and unit trusts. That will enable us to start small. We won’t need an army of researchers,” he says.

The robo-advice service

Thameside Financial Planning managing director Tom Kean has recently created an automated advice service primarily for the children of existing clients. Full advice may not suit these clients but they are still important to the firm.

The Pathway service is white-labelled with the firms’ back-office provider, Intelliflo, and offers its clients access to the Vanguard Life­Strategy range of risk-rated funds. Kean felt this approach would enable Thameside to “dip its toes” into automated advice without investing too much time and money in it.

“Like most advisers I read quite a lot and it seems if you ignore technology you are going to get left behind. I was not keen to go down the DIY route because our business model is the opposite of that – we do everything for clients, not just provide information,” he says.

Tom Kean: Independence must remain sacrosanct

Kean has been testing Pathway out with clients who want to do something simple like take out an Isa, as the service could reduce the time and effort of going through all the hoops that come with full advice. However, he does not see the service as a huge part of his overall business – at least for the forseeable future.

“This could have the potential of being a distraction but we’re viewing Pathway as a service enhancement, not as a brand new stream of business. We can do it with no financial risk and very little time expenditure. Will we ever scale Pathway? Probably not, as it would need an enormous amount of web traffic to drive clients to it,” he says.

The financial services media service

It was the closure of Unbiased’s Bluebook, which connected advisers and financial journalists, in July that prompted Rowey Turton director Scott Gallacher to set up his side project, Money Media Group.

Gallacher established the Facebook group to fill the gap as a resource for advisers wanting to build a media presence and for financial journalists looking for contacts within the advice community.

“The Bluebook was invaluable to me in establishing relationships with journalists. Its closure made it hard for some advisers to find journalists’ details and this was an easy thing for me to do,” he says.

Scott Gallacher: Why advisers should build a media profile

Gallacher says press work is part of the reason Rowley Turton is as successful as it is. “Doing press work means potential clients doing their research might come across my name. That builds my credentials and encourages people to ring. But it is a slow burner; it does take a few years for it to work.”

He believes other advisers considering a side project should go for it, as long as they are genuinely interested in it and that it is not going to interfere with the time they spend with clients. “Money Media Group was easy to set up, and I have enough of a media profile to get it a bit of traction.”


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