View more on these topics

Virtual virtuoso

If Junior Sobowale&#39s enthusiasm is anything to go by he is about to bounce his competition – the big IFA networks – out of the ring. Last week, he launched a new internet-based IFA network Virtual Net alongside management team Stuart Smith, Ian Nairn and Yinka Akanji.

Energy is definitely not something this chief executive lacks. After completing the London marathon in April he decided the experience was the closest he will ever get to childbirth. But after another marathon effort spanning two gruelling years, Junior&#39s new baby is about to take its first steps.

He managed to keep Virtual Net top secret, involving only a limited number of contacts, and went about quietly recruiting people from top positions. He says, voice slightly lowered: “We only told people we could trust.”

He firmly believes technology is the missing link in far too many areas of financial services and that this is why he handpicked someone as experienced as Yinka Akanji as IT director. He has worked on IT systems for Reuters and the BBC. Client services director Stuart Smith and finance director Ian Nairn make up the rest of the management team.

Sobowale has been in financial services for 14 years, initially as a practitioner and then in senior management. He says he wants to revolutionise the way IFAs do business. He repeats how often people ask him why the big players have not brought in any of the changes he claims to be pioneering.

He says: “Polarisation came in in 1988 and I still think the concept of the network is brilliant but it has not evolved since then. The problem is that although many IFAs want to change networks because they are unhappy with what they are being offered everywhere they go they are coming up against the same problems. It is always the same old story.”

Virtual Net launches this month from offices in Maidstone and London with 50 RIs. It will offer three ways to pay for network service. Members can choose to stick with the traditional way of paying a fixed percentage or pay on a fixed fee structure which Sobowale describes as an “all you can eat option”.

The Homer Simpson choice means members pay an initial set fee for the network service no matter how much or how little business they carry out. This option, claims Sobowale, could save some IFAs 35 per cent on what they are already paying for network membership.

The third option is the pay-as-you-go method where clients pay £99 fee per case. He says: “This will be ideal for those who only write a small number of cases, possibly those doing business with just a few large companies and could be ideal be for older or semi-retired IFAs.”

If customers are unhappy with the Virtual Net service they will be free to go – there will be no enforced notice period to serve.

This is something that Sobowale feels quite strongly about, he says: “Why do the networks lock IFAs into deals if they are so confident about the service they offer? At the moment, only IFAs who are doing really well can afford to buy themselves out of their network.”

He believes that the £30,000 bank loan facility that Virtual Net can set up with HSBC to bridge the three-month notice period could significantly ease this problem.

An online underwriting engine will be available to members on the Virtual Net site, allowing IFAs to do their paperwork overnight and have it checked the next morning.

As soon as IFAs file their queries online, they will be “eye-level” checked and stored. At the moment, checking is done by most networks on a random sample of 10 -15 per cent of cases. The online facility will mean that 100 per cent of cases can be checked.

“If you have to keep going back to a client asking for more details three or four weeks after your first meeting with them the client will assume you are unprofessional and inefficient,” says Sobowale.

He thinks cutting the paper trail will equal far less time spent on compliance. He says the system could well be popular with “saddos” who are keen to do their paperwork at four in the morning but hastens to add that although there will be a phone back-up system to the service run by his compliance department, it will not be available 24 hours.

In the run-up to the launch, the team has been in talks with major life companies about IT development. Sobowale talks about the importance of being in touch with frontrunners in IT and says: “The life and pension sector is a little bit backward. We understand we are a few years ahead of the game but we really embrace technology and expect that from anyone working with us.”

The ACOS research system and all training will also be offered online and included within the price of the network. Equity and shares in the company will also be available.

Junior Sobowale can talk the hind legs off a donkey and it is difficult for him to restrain his obvious excitement about the whole project finally coming together. The site went live last week. The company&#39s clenched-fist logo runs alongside the “revolution, evolution” slogan is more reminiscent of political activism than an IFA network but it stands out from the crowd.

“Wow” is one of Sobowale&#39s favourite words and he can find a use for it in almost every phrase about Virtual Net.


Impaired sales rise by a third

Sales of impaired life and enhanced annuities grew by 30 per cent in the first half of this year and are set for further growth, putting greater pressure on conventional annuity rates, says consulting actuaries Watson Wyatt.The firm says enhanced annuity business reached £254m in the first half, representing a 9.3 per cent share of […]

Bristol & West launches new structured product

Bristol & West has introduced a new seven-year income & growth bond with guaranteed return of capital.The structured product offers monthly income of 5.84 gross for the term of the product. Part of the sum invested is placed in a seven year guaranteed equity bond which pays interest linked to 90 per cent of the […]

Standard slices payouts 10% as surrenders rise

IFAs say Standard Life has bowed to the inevitable by imposing a 10 per cent market value adjuster and slashing payouts by 10 per cent on Monday.Standard has made the with-profits cuts in an interim bonus declaration. It blames the move on stockmarket falls and rising surrenders.It follows increasing media and industry speculation about the […]

Tax returns

Do you think the Inland Revenue&#39s delay in publishing its report into taxation of pensions is because it is adjusting its proposals to make them more complex or less complex?Clarke: I doubt very much that the Inland Revenue will make recommendations to the pension tax regime that would complicate the existing minefield of rules and […]

Iain Chadwick

The Budget 2015: a brief overview

Following George Osborne’s delivery of his sixth Budget as chancellor and the last of this current parliament, we have provided a brief overview of the initiatives put forward in his statement, focusing on the topics that have an impact upon the pensions landscape, savings, personal taxation and businesses.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm