Some advisors carry an entrepreneurial gene. They are risk-takers who chart their own destiny by building a successful business from the ground up.
But they may not stop there. As much as they enjoy counseling clients on personal finance — and helping them plan for the future — restlessness can set in. Eager to tackle new challenges, they may launch side businesses while growing their advisory practice.
Take Brett Danko. In 2001, he opened a solo fee-only firm at age 33. At the same time, he wanted to teach adults to improve their financial literacy.
So he did both.
Running A Successful Business On Several Levels
Once he earned his certified financial planner (CFP) credential in 2002, he expanded his teaching to include tutoring programs to help advisors pass the CFP exam. He also entered the professional speaking circuit, addressing audiences on financial topics.
Today, Danko continues to run his successful business, Main Street Financial Solutions in Newtown, Pa. He also helps advisors prep for the CFP exam.
In this interview with IBD, Danko, 51, discusses how he weathered his first year in business, how to be a successful entrepreneur and how he plotted the strategic growth of both his advisory firm and his other income-generating activities.
IBD: How would you describe your first year in business?
Brett Danko: I was working with clients on an hourly basis. I was also doing a lot of teaching at the time. I was going 100 miles per hour in every direction back then.
IBD: How did you manage your time?
Danko: It’s not easy, because you learn that when you have this wonderful freedom, it can be a 24/7 job. You’re always building. You’re always on. Turning it off can be tough. You need to separate the two.
IBD: How did you turn it off?
Danko: We had our first child, our daughter, in early 2002. My wife was going to put her in day care. But we decided to keep her at home so that I could be there with her. I was fortunate to spend those first nine months with her.
IBD: In terms of striving to create a successful business, did you feel pressure to market yourself and grow your client base during that first year?
Danko:Not really, because I had other income streams with teaching and (professional) speaking opportunities. I was able to find fee-only clients through word of mouth and referrals. And I had a supportive spouse who had a good job.
IBD:How did you get referrals?
Danko: When I met people — through my college alumni network, through church, other young parents — I’d say to them, “I’m sure you’re in great shape. But if you know anybody who can benefit from my services, please let me know.” That’s better than saying, “Hey, can I work with you?” I didn’t want to make people feel uncomfortable.
IBD: What advice would you give financial advisors just starting their own firm?
Danko: In your first year, you need to set short-term, medium-term and long-term goals. I did that in 2001. I’m a big three-year plan guy. I had revenue goals along with goals for number of clients, number of speaking engagements, etc. In my first year, I was in the range of hitting all my goals but I didn’t exceed them. My wife was working so I was blessed.
IBD: How did you know whether you were setting realistic goals?
Danko: I started by asking, “How much do I need to make in year one, two and three?” I didn’t want to set overly ambitious revenue goals because I didn’t want to take on certain clients — the folks just looking for hot stocks. I wanted to do financial planning for people who valued financial planning.
IBD: What traps do financial advisors need to avoid in launching their own firm?
Danko: I remember thinking, “Hey, I’m open for business.” I thought people would just show up. But it doesn’t work like that. You have to keep at it. And it’s important for advisors to know that it’s the six months before they open for business that they need to get their ducks in a row. You need to use that time to make yourself aware of all the costs (of launching a firm) and then set a budget. As I planned for my launch, my wife and I decided we weren’t going to take any vacations or go out to dinner.
IBD: Can you give examples of other preparatory steps you took in those six months?
Danko: It’s helpful to get honest advice, so I’d ask mentors for help. One of them asked me, “Did you set up a LLC (limited liability company)?” I learned about state regulatory fees, software I’d need, stuff like that. It opened my eyes. I said, “Wow, there’s a lot more to this than I thought.”
IBD: How did you generate revenue as a teacher and professional speaker?
Danko: I’ve always wanted to be a teacher. And I wanted to teach older, mature people who were engaged rather than a group that didn’t want to be there. So I started by working under Ken Zahn, who’s an amazing instructor. He became a mentor to me. I took his live (CFP) review course and then I passed the CFP exam. From there, I bugged him to let me teach. Eventually, I was teaching CFP classes on my own around the U.S.
Building A Successful Business: Professional Speaking
IBD: How about your professional speaking? How did you get paid for that?
Danko: I was represented by an agency that lined up speaking opportunities for me. I was mostly speaking to college students about personal finance. It was a boot camp with educational seminars on managing debt and other topics. It started when a friend was doing professional speaking to college students on leadership and how they could avoid drugs and alcohol. He said to me, “You’d be a natural.” At first, I gave a few talks for free. Soon, I was getting paid. Back then, many colleges had a budget for speakers.
IBD: How would you describe your entrepreneurial strategy?
Danko: It starts by asking yourself, “What do you like to do?” Then, “Are you good at it?” and “How can you get paid to do that?”
GENCapital is a wealth management firm offering investment management, financial planning and business advisory services for individuals, families and organizations. With a concierge approach, extensive resources and generations of experience, we go beyond traditional investment strategies and partner with you to deliver a plan customized to your goals. Based in Atlanta, Georgia, our team of qualified and reliable professionals is committed to developing long-term relationships and building your wealth for generations.
For more information, contact us.