How a Fast-Growing RIA Gets Referrals

“These plans speak to referrals and how each office identifies referral sources,” Swenor said. “Each office knows their existing and potential future relationships.”

In the Vermont office, for instance, where Swenor is based, “we’re good at deep relationships with just a few centers of influence because so much of wealth management is relationship-based,” he said. “Rather than going shotgun to have as many as possible, we have fewer but deeper relationships. It speaks to long-term relationships and secondly, a two-way street of having conversations so that we refer to our clients and they refer to us. Not all of our clients are looking for a new lawyer or accountant, and not all of their clients are looking for a wealth manager, but there are opportunities over time.”

The Vermont office has identified its ideal client profile — and written up that profile as a one-page document that spells everything out — as a multigenerational family with $10 million or more in investable assets that feels comfortable delegating investment-making decisions and family office services to the firm.

In comparison, Swenor said, the New York office counts many trust and estate attorneys among its centers of influence. And professionals in the newest office, in Virginia, are now building relationships by sitting on philanthropic boards of three or four local organizations and holding charitable events. “It develops an interactive and engaged audience that allows us to showcase our thought leadership without it feeling like a paid commercial,” Swenor said.

The Basics: Swenor’s Tips for RIAs on How to Get Referrals

1) Understand your specific value proposition and ideal client profile. First, determine your firm’s strengths and weaknesses, then use that knowledge to shape your ideal client profile. “Don’t try to be everything to everybody,” Swenor said.

2) Pay attention to your centers of influence (COIs). Keeping tabs on the people and firms that your firm comes into contact with on a regular basis is an organic way to boost market access and credibility — and a potential source of referrals, according to Swenor. “There is a mutual benefit in finding the right firms, individuals and settings after you know what you want,” he said, pointing to the advantages of finding potential referral sources in firm-to-firm meetings with like-minded accounting and legal services groups.

3) Make referrals a strategic priority by putting a formal plan into place that’s known throughout the organization. “Each of our office leaders has completed a three-page business development and marketing plan with a consistent measurement of prospects, COI referrals, public relations, events and expanding relationships with existing clients,” Swenor said.

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Read Schwab Reveals Secret of Fastest-Growing RIAs at ThinkAdvisor.