If there’s one thing that the pandemic taught us it’s this: Many clients are OK with not having face-to-face interactions with their advisors. In fact, there are a few firms that are providing proof of concept that the remote model works—and does so very well.
And it took a 30-something CEO from Silicon Valley to make us pay more attention.
Because when the pandemic hit, his firm already had a working model in which clients interacted remotely with their advisors.
So in 2020—while the world was shut down—they experienced 4x growth.
The firm is Facet Wealth, founded by Anders Jones, a wealth management industry outsider.
Anders recognized an opportunity to serve clients who no longer fit the big firm mold. It was a scenario propelled by the DOL fiduciary rule requirement that financial advisors act in the best interests of their clients—yet in a commission-based structure, that became more difficult to accomplish.
So in 2016, Anders took a “ground up” approach and developed a fixed-fee-based independent firm that focused on the untapped market of mass affluent clients, many of whom fell outside of the asset minimum big firms required. Facet purchased those clients who lost their advisor relationships—a concept that provided a foundation for the nascent firm.
Yet it was his mother’s vision that Anders credits as a “profound lesson” for him. Her career was devoted to making 401(k) retirement plans more accessible for everyday people—first at Fidelity and later at T. Rowe Price. In her words, “helping millions of Americans save for retirement.”
Anders sees Facet as his mission to carry on where is mother left off, by “helping people achieve financial wellness.”
To do that, Anders sought out to deliver completely unconflicted advice—free of the ties that bind fees to assets. Instead, Facet charges a flat annual fee reflective of the services provided.
But how does a firm with a fixed subscription model make money? That’s where Anders’ fintech background shines.
And it seems to be working. Aside from outstanding growth, the firm has raised more than $60 million in venture capital with backing from Warburg Pincus.
Educated at Stanford with an MBA from Wharton, Anders takes a unique approach to business—no doubt gleaned from a dozen years as an early-stage investor in emerging tech markets as a founding partner at Argyle Ventures and prior to that with adtech firm LiveRamp.
In this episode, Anders shares his story with Louis – providing a unique entrepreneurial perspective that’s both philosophical and analytical – including:
- The key drivers of Facet’s success—and how this unique model serves as a template for financial planning firms ofthe future.
- His background in fintech—and how that enabled him to take a different approach with technology designed not to replace advisors, but to make them more efficient and create scale.
- The strategy of targeting an “overlooked” population of clients—and how Facet’s subscription model enables their advisors to serve these clients effectively while generating revenue.
- The impact of the investment from Warburg Pincus—and Anders’ view of taking on a capital partner.
The future is wide open for entrepreneurs like Anders: Who think with autonomy, seeing a need and building from the ground up to solve it, rather than trying to rebuild from an existing chassis.
It’s an episode that offers a glimpse into the entrepreneurial mindset—and how that mindset is motivating change in the wealth management industry.
Mindy Diamond is CEO of Diamond Consultants in Morristown, N.J., a nationally recognized boutique search and consulting firm in the financial services industry.