Only Fee-Only
This podcast interviews fee-only financial planners to learn about how they are helping their clients and serving their specific niches.
Only Fee-Only
#114 - James Conole on Building a Team, a Brand, and a Massive Audience
Root Financial, led by James Conole, explores how to effectively scale a financial advisory firm while prioritizing culture and client experience. Key topics include the Sequoia System, marketing strategies, and the establishment of Root University to train advisors, alongside insights on creating a vibrant workplace.
• Introduction of James and Root Financial
• Explanation of the Sequoia System and its significance
• Overview of marketing strategies, particularly YouTube and podcasts
• Streamlining the sales process for better client onboarding
• Importance of internal training through Root University
• Focus on creating a fun and engaging work culture
• Discussion on long-term business strategies versus short-term profits
• Vision for the future of Root Financial and its impact on the industry
James Social and Webiste:
https://www.linkedin.com/in/jamesconole/
https://www.rootfinancial.com/
Music in this episode was obtained from Bensound.
How's it going everyone? Welcome back. Happy New Year. I hope everybody had a nice break. This is the first podcast of the year, so we're excited to make this year your best year yet. In this episode, we talked to James Canole, who is the founder of Root Financial. This is his second time on the podcast and he is absolutely awesome. He has built an unbelievable firm with Root Financial and has over 160,000 subscribers on YouTube because of his financial education. James has a brilliant mind. He's one of those people that really understands how to build a business at scale. So if you have any desire to do that, this episode is for you. And even if you just want to stay small, there's absolutely things that you can learn. So, without further ado, enjoy this episode of the Only Fee Only podcast with James Canole.
Speaker 2:How's it going everyone? Welcome to another episode of the Only Fee Only podcast. I'm Peter Travlo. I'm here with my co-host, brock Buckles, and today we are very excited to have James Knoll back on the show. He's the founder and CEO of Root Financial and really excited to have him on and share how he has been growing. So, james, welcome back to the show. Thanks for having me back, peter, good to see you.
Speaker 3:You too Brock. Yeah, you too man.
Speaker 2:Likewise. So for those who don't know who you are, do you want to give a quick background before we dive into things?
Speaker 3:Sure, yeah, I'm James Canole, founder of Root Financial. We're an RIA, we've been around about seven years or so and we can dive into any details that you want, but that's the gist of it.
Speaker 1:Yeah, man. So let's talk about I mean, like for anybody that wants the intro, go back to episode 65. That was, I don't know, maybe a year ago, something like that, and I think you're going to be shocked, because one thing about James and the team at Root is they are growing with an explosive pace. So since the last time I think it was Ari you guys had a couple of advisors. You guys are growing like absolute crazy, able to serve so many more people. We learned about last time what was it? The Sequoia system. Am I getting that right? That's off my memory, is that okay? Yeah, so tell us about all of that, man. How are things going? Is everything the same in that regard? And then, how are you growing the team?
Speaker 3:Yeah, everything's the same.
Speaker 3:In that regard, and I forget exactly in what context we talked about it, but I think a big part of it was as we're marketing and growing, the key is having a consistent client experience that aligns with a consistent marketing experience, and if there's any deviance or deviation between the two of those things, it just creates some friction and some challenges.
Speaker 3:So Sequoia system is our way of saying hey, what we're talking about on YouTube, what we're talking about on podcasts, what we're talking about online, how do we package that up into a way of doing things, at least a way of like the initial build out of a financial plan, and it's nothing so complex that would blow anyone's minds, but it's just a way of saying, as planners, we talk about cashflow, we talk about investments, we talk about taxes, we talk about insurances, estate planning, the purpose for what it's all for.
Speaker 3:How do you organize that, though, in a cohesive way, so that when I'm talking to Brock and he's wanting to become a client, it's not just like, oh geez, there's 50 different things I could talk about. How do I prioritize these and how do I put these together in a way that makes sense, to meet Brock where Brock is, and so it's saying okay, we've done this with enough people. What tends to be the way that we can, um, not just be a good planner but have a planning process that starts with the right foundational thing, like do we talk about insurances first? Do we go right into your desire to do this roth conversion because you heard someone talk about it on youtube? Do we, uh, talk about your family first? So what's the way, what's the right order of operations to go through those things so we could design a system that connected the dots between what we're talking about online and what it's actually like to work as a client at Root Financial.
Speaker 2:And for those who don't know, let's talk a little bit about your marketing and how you're able to get so many people through the Sequoia system too, because it is a, you know, a tested system. You've put many people through it. You know what is kind of the marketing that's able to really make the Sequoia be a good product too.
Speaker 3:Our marketing is primarily YouTube and podcasts. So I have a YouTube channel and a podcast. Ari Taublieb has a YouTube channel and a podcast. We just started another joint channel, slash podcast, a joint or like a root to or, I'm sorry, a root financial YouTube channel, the goal of which is to really highlight all the incredible advisors and team members that we have, because there's just so many talented people that are like how do we also expose that talent and skillset and resources? So it's it's a combination of those two things. Then, anytime we do a podcast or a video, it's been turned into a blog, it's been sent out to our email list. So at this point, there's a lot of different things going on. A little bit of social media presence we're going to be reinvesting more into that in the new year but mostly YouTube podcast and then online stuff like blog and SEO.
Speaker 1:Yeah. So let's talk about that man. I'm going to make you brag on yourself for a second. You're a humble guy, but I'm going to make you brag on yourself for just a second. Growing the YouTube. I think a lot of people are intimidated by the idea of putting themselves out there and like am I going to look stupid? How do I start to do it? Like what, how, how did you kind of start? And then, first of all, how many subscribers do you have now?
Speaker 3:160,000.
Speaker 1:160,000. Okay, so like you didn't start at 160,000, right? So how long have you been doing and how much has, like, just discipline and then innovating, kind of the content that you're putting out, led to that growth? Because a lot of people are starting square one, you know, they don't even know what to do to put the first step out there.
Speaker 3:We've been doing YouTube. I would say full time, and by full time I mean like committing to at least one episode released each week. I believe it was fall of 2021. That started maybe summer of 2021. I forget the exact three years, almost three and a half years, at this point. Before that, there was a couple podcasts that I was doing so like I think that helped to generate the reps and, you know, start to build a little bit of an audience, start to be able to understand which ideas are people looking to have communicated, start to start to build that skillset, I guess. So that goes back to, I think, 2019 doing those. So at this point, it's been five and a half, almost six years of doing it. No-transcript.
Speaker 2:Very cool. So you know this is a tested system and you reach capacity at some point and then you eventually brought Ari and have partnered. But you know, like if other advisors they're just looking at, how does an enterprise firm scale? You know you have a nice network, you have a YouTube channel. So, as you know, families or individuals they indicate hey, you know what I might like working with Rue, what does that interaction look like and how do you point them in the right way to the right advisor who can help them?
Speaker 3:So I think this was um, I guess I'll talk about this from the advisor side first and then the client side of that. First it's like okay, this the. The code to crack is how do you get people to view your YouTube channel or view your podcast, and that happens. And all of a sudden, you get 50 people reaching out in a month Like, okay, awesome, beam over one, we're good. Until you realize, 48 of those people want different types of services. Maybe they only want to pay an hourly fee. Maybe they're like, oh shoot, okay, actually this sucks. This isn't what I thought it would be. It's actually a time liability more than an asset.
Speaker 3:And so then you got to figure out how to crack that code of how do you message things, how do you position things, how do you screen. Then you get better and say, okay, 50 people reach out and 50 people are qualified. Well shoot, how on earth are you going to onboard that many people? As an individual? You can't. So you start building a team of people. And then that's where you realize, okay, I've got a team of people who are all really insanely qualified. But if we're all doing things differently, so-and-so is planning this way and so-and-so starting with this meeting and so-and-so kind of use. That like that goes back to the whole Sequoia system thing, like what is our process for those people to come on board to where there is going to be that consistency of client experience, regardless of which advisor you're working with? So you figure out that piece. Then you realize, okay, well, how do we train people on this? When it was smaller we were small enough to say let's all meet and let's all be in the same room, let's all be on the same call, together and train. But now that's not possible. So how do you build out curriculum to say this is how we do things? This isn't going beyond just the CFP standards. If here's a technical advice on retirement, cashflow, insurance, investments, whatever, that's great. But you could pass a CFP and be a horrible advisor if you don't know how to communicate those in the way that they should be communicated, if you don't know how to kind of connect the dots, if you don't know how to be an effective communicator, be an effective coach, be an effective guide, and so how can we train and develop and have an internal system? So we call ours root university of how do we start to develop advisors beyond just the CFP and like I'm not going to say that we have everything figured out, like there's still so many things that we want to do and make this better, but YouTube's kind of like the first domino to fall just because that happened and maybe for someone else it's blogging, or maybe for someone else it's public speaking, or maybe for someone else it's gold calling, like whatever it is, that you can figure that piece out, but that's not automatically leading to success, like then it's okay. Well, how do these other things?
Speaker 3:The screening process, the sales process, was a huge one, like it used to be. All advisors as we started growing a team, someone would reach out from YouTube and there's just a round robin of they book a time on roots calendar and whatever advisor happens to be available at that time takes the call. But then it's an intro call, then it's a discovery meeting, then it's a proposal meeting and you're chasing down state and it's like, oh my gosh, like 25, 30, 40% of some advisors' weeks are just chasing down prospective clients. What a terrible use of advisor time. So we consolidated the sales process to where we now have a different sales team, kind of client success team that takes those calls, that does the screening that connects them with the right advisor. So by the time that an advisor at Root is actually talking to a client, it's just a kickoff meeting on their calendar. Like, hey, this person has signed the agreement, they're ready to go now they haven't transferred assets over or anything. So, like you as the advisor can still say no, I don't actually want to work with this person if you don't feel like this is a good fit for you and the client. If, for whatever reason, they don't feel comfortable using advisor still has the out of saying I don't have to move any assets over or anything here. So it's.
Speaker 3:Youtube was great and then it exposed all the things that need to actually be done to grow a firm. Because when you're smaller and growing, like at a, you know, a relatively good growth rate, you can get away with having systems that aren't totally optimized. Like optimization doesn't need to happen if it's not that much friction like being caused as you're grown at a certain pace. But once that exceeds a certain pace, it really highlights the cracks in the infrastructure and where you need to shore that up. So I think that's kind of like the first thing that happened and since then it's been like a progression of okay, that's working, but it's shown us that this is broken, so we fix that. Okay, now that's where it's showing that this is broken, so we fix that. It's just kind that continued effect of I don't think that's ever going to stop, like as you grow, that's going to continue to be a thing. That is part of the fun.
Speaker 1:Yeah, it's the. It's the, the ever evolving journey of, like entrepreneurship and building a firm Right, I mean, at the end of the day, there's always something that you're going to have to learn. That's going to be the next step. But it sounds like Root University has kind of been just things that you picked up along the way, like, all right, we're running into this problem here, so we're going to include that in the curriculum. Has that just been like pieces that you've seen as you've gone through the process, little speed bumps or hurdles that you've hit, where you're like, all right, let's teach these advisors these things, because these are the same issues or problems that people are coming across time and time again.
Speaker 3:Yeah, and I think so. What Root University is, it's a combination of like. Some of this is basic like, hey, here's the agenda for each meeting, so it's plug and play. Here's what you should be doing ahead of the meeting to prep for it. Here's a follow-up after the meeting. Here's what we are doing. Equally important, here's what we're not doing in this meeting. Like, hey, in the kickoff meeting, our temptation is to jump in and start solving stuff. Like we're not doing that here. We're connecting with the client, we're identifying their pain points. We're really building that um trust factor, like ability factor, so that we can come back in the next meeting and solve it. So root university is kind of like every meeting in our onboarding process. We haven't gotten to the point where we're. We've dialed in our review meetings in like a systemized way within Root University. Yet That'll be a project for 2025.
Speaker 3:But, like our kickoff meeting, how do you open it up? I'm talking to Peter or Brock for the first time as a prospect. How would I open that up? And so it's me recording videos. How would I then transition to talking about the agenda for today? How from there would I transition to like, the various parts of the meeting, and so a lot of it's a video overview and it's not like I'm the best advisor. I'm not the best advisor in the world. I think there's other ways of doing it that are awesome, but the importance of it is like people, if they're coming from a youtube channel or I'm talking or the podcast where I'm talking, like they're expecting things to be messaged a certain way. It's not the only way.
Speaker 3:I won't even say it's the best way in all cases, but it's the way that we're doing it, and so it's a lot of video stuff. It's a lot of. Here's what we're doing, here's the flow, so that when advisors come on board and then like they have incredible experience, they're great people they can make okay, I'm about to run a kickoff meeting I can go to root university, watch some stuff, do this. It doesn't. That doesn't replace like, just reps and doing it over and over, but at least give some structure for here's what you should be doing. Here's what's expected in terms of, like, automated messaging the clients received up until this point, so that you know we can remove all the stuff that's not advice related and you can just step in and start advising yeah, yeah, for sure.
Speaker 1:And how many advisors do you guys have now?
Speaker 3:Yeah, uh, we're at, uh, 31 people of that. I think there's 12 or 13 lead advisors and we have associates, so we have one associate for each lead. Um, yeah, we have senior advisor roles, client service associate, some other other roles beyond that so is this.
Speaker 1:did you know that you wanted to go this direction? I mean, you got, you were growing, but you're at a completely different level now than the first time that we talked, like when you were launching this thing and Ari was reaching out and like he was the second person to ever come on board. Did you ever think, hey, this is a direction that I want to go with the firm? Or was it kind of like maybe we'll be more boutique because you're certainly you're past that point. You're growing a very large firm at this point um compared to compared to many um but was that kind of the idea from the get-go or has that been something that's really evolved over time?
Speaker 3:it's, yeah, it's been the goal from the get-go. Um, I think it's happened faster than maybe I thought it would, but from the get-go I remember when I first started taking a day just like what? What do I want root toot to become? Do I just want to make this just me, run a really lean business, have a handful of clients I love and do it that way? Or do I want to grow a team and do things that way? And there's pros and cons of both. But, like, I walked away from that thinking no, like this would be really fun to grow a team. Um, any, you know the, the way I, the way I got into the business is a whole long story, but try to keep it super short.
Speaker 3:Like the advisor, the, the, the firm I started with, the way that that firm was growing was through being part of the Dave Ramsey smart investor network. So the, the dave, was an endorsed local provider, is what it used to be. Now it's called smart investor. And so you just get like, you pay the dave ramsay team and you get tons of leads of people who go to dave ramsay, say I like what you're talking about, who's an advisor in my area that you can connect me with and we were one of those advisors and you just got so many leads and I remember thinking, like these people are like not always, but sometimes it's hard because they're looking for Dave Ramsey's advice, but they're just getting me. Like, what if, instead of paying to essentially get the benefit of Dave Ramsey's platform? What if you become Dave Ramsey? You'll need to be on that grand of a scale. But, geez, if Dave Ramsey opened up his own firm, his own RIA love him or hate him, he's going to be one of the biggest rias in the country. If he get the infrastructure right, for sure he's got a massive platform.
Speaker 3:And the message it's not I mean he, he does a very good job, you know, love him or hate him of having a very clear message and a very clear framework of what do you need to do to accomplish that? Yep, is that simple? And then a platform to take that message and leverage it over his radio programs, his books, his courses, to the tune of I don't know how many tens of millions of people have heard that message. And if they think finance, they think Dave Ramsey. And so it's like well, can we take that path? Um, and that path is so much easier today where 20 years ago, 30 years ago, you want to do that cool, like there's gatekeepers. You got to get approval from the radio station to make that happen. You got to get approval from the publishing company to publish your book approval's wrong word. Like someone's got to bring you onto their platform and you don't pay a lot of money or spend a lot of time or doing whatever it is and like that. That's a huge barrier to entry.
Speaker 3:And now we live in a time where it's so insanely easy I shouldn't say easy so insanely simple to get exposure, to have your own platform If what you're doing is quality content. You have LinkedIn, you have Instagram. You have Facebook, you have YouTube. You have Facebook, you have YouTube. You have podcasts, you have it's. Might seem like it's somewhat crowded, but like that's a way easier path to take than 30 years ago and having to get, try to find to get a radio station and come up with the money to get on a radio station. I can record a video for free right now on my iPhone, upload it for free to YouTube. By the way, youtube is going to pay me for doing that and they're going to try to take my video and show it to as many people as possible. So it just I knew that I didn't know like things would turn out exactly how they are turning out. I think they're happening faster than I thought that they would.
Speaker 3:But yeah, I think from the beginning I thought it would be really fun to build a team of awesome people to where it's not the traditional go out and hunt and gather but like build a core team, build a core solution that's got a different message than what traditional finance looks like and really optimize for fun. Like not optimize for hey, we need to I don't know massively grow revenues in the next five to seven years and increase profitability so that we can sell this private equity backed firm to another private firm. Or we don't know massively grow revenues in the next five to seven years and increase profitability so that we can sell this private equity backed firm to another private equity firm. Or we don't need to retire in five years to the highest bidder. Like we can just build something that's optimized for fun and for client.
Speaker 3:And part of fun is like feeling good about the work that you're doing for your clients. Part of fun is feeling like you're surrounded by the most talented, amazing people that feel good about the work that they're doing and so fun is building an awesome place to work to where, like our goal now. So I don't have any clients I'm the lead advisor for anymore and my full focus is, like, how do we make root the best company in America to work at? Not in financial services, because that's not saying a whole lot. There's some great firms but, like for the most part, we're not an industry really known for like that's an awesome place to work, so how can you make it that?
Speaker 3:So, in the same way that we attract a lot of prospective clients through content on youtube, well, how do we attract the best people in the industry to say I want to take my skills, my talents, what I'm good and use them at root, where I can thrive in terms of how I'm being developed, in terms of potential, in terms of the environment, people. I get to do it with flexibility, all that stuff. So long-winded way of saying yes, I thought that we would grow something I had no idea and I still don't have like an aspiration for like we want to hit X number of billions or whatever over time, as much as I think will grow pretty big, but that's not what we're optimizing for. I think it's going to be more of a byproduct of the things we are optimizing for.
Speaker 2:I love that. So I mean with building culture and building the team, like what are just some main bullet points that you would highlight, that you know what at the end of the day? We do this very well. This is why advisors are going to stay here. We do this very well.
Speaker 3:This is why advisors are going to stay here, come and thrive. Well, I think it's like it's hard to be an advisor. Um, in a lot of like it's hard to be a good advisor because you're either at the small firm where the owners maybe a few years out from retirement and it's a lifestyle practice for them and they're hiring you on as, like, a junior advisor, but there's there's a ceiling there. Like you you're, you're not going to have a career there. And then you have a bunch of larger firms and not all of them. A lot of them are now getting acquired because the original owners are retiring and it's typically maybe private equity coming in and those private equity firms are trying to hit return numbers. And the way they hit return numbers is they go to the advisor and say you got a certain quota you need to hit. You can't be selective of who you work with.
Speaker 3:The culture. Like when we post a job, we see so many people from those firms applying who are super talented people. Like I didn't want to ever leave my company until our company was acquired, until we merged, until these things happened, and now it just sucks. Like now the culture sucks, now I don't enjoy going into work. Now I can't focus on being a great advisor anymore. I'm having to I don't know come up with a list of 50 names that I can hit up in the next month so that the private equity firm feels good about the investment they're making in us.
Speaker 3:So, like the small firms, there's there's a ceiling on how far you can go. If you want a big firm where there maybe is more of a traditional career path, that environment's not always great, and this isn't to say like there's not great. There's a lot of great firms, I know, but they're in the minority. And so what do we do? And like the first thing is we're being very intentional about like we don't ever want to take money Not against it. Like there's good reasons to sometimes, but like we we never want to be beholden to like short-term time horizons in the way that we're growing. We've grown a lot in the last 12 months, 24 months. We could have doubled that or tripled that. If we're like, hey, let's go get private equity money and hire a whole bunch more advisors and onboard a lot more, but the fun would have been just totally squeezed out of what we're doing in that case?
Speaker 3:So I guess what we're doing is like we have the benefit of a long time horizon and we have the benefit of saying, yes, we have to be profitable, yes, we have to like do things to ensure we're running a good business, but we're making the types of decisions that would make it obvious to a client that this is the best place I could possibly be to have my needs met and to make it obvious to anyone in the industry like hey Root's the best place I could be to have my needs met. So what are those needs? It's typically autonomy. It's typically flexibility. It's typically like a well-structured career path. It's clear compensation potential.
Speaker 3:It's doing great work with people that you love. It's having fun. It's like we're a remote team but like we do a couple of. We have an in-person team retreat coming up in February. That's just going to be awesome and like so much fun, like doing work that you love with people that you love doing it with. So there's a whole bunch of things to that and I don't want to talk like we've got it all figured out, like half of me as I'm saying it all figured out like half of me as I'm saying it's like, ah, we still got a lot of work to do.
Speaker 3:That's what makes you good at what you do, though, man, but those are the things that we're moving towards and that we're um pursuing right now.
Speaker 1:Very cool I love it, man. I mean the thing that I think you you just always had a really large vision. I think you've always known what you wanted to do. But but the thing I respect about you most is like the adaptability and the way that your brain works. You're like we're going to figure this out, we're going to keep it fun, we're going to grow, but at the appropriate rate of speed. We're not going to sacrifice culture and values and all of that just for money.
Speaker 1:So it's really cool and I think that when you are focusing on the right things and you're growing the right way, that is what makes it fun. That is what makes people want to come there. That is what makes Root Root Right. So I think that's really cool and I applaud you for it. Man is kind of hiring. Obviously, it's got to be the right person. So for people that might be curious about checking you guys out or have a conversation, or maybe they're an advisor that's not super happy right now where they're at, or they kind of want to be at a firm that feels more fun or gives them that energy that they desire, how can they get in touch or at least keep up with hiring updates potentially?
Speaker 3:The easiest way is to follow Root Financial's LinkedIn page. Follow me on LinkedIn. Like that's where we make the announcements right now. We got some stuff that we'll be rolling out in the beginning of 2025, specifically around, kind of around that. I don't want to say too much right now because I'm still dialing in some things internally with the team and a couple of people. What that will will look like.
Speaker 3:But, um, yeah, we, we want this to be a place where, if you're the best at what you do, we want it to be so abundantly obvious that roots the best place for you to do it at. That. It's just like why would I do this anywhere else? Not to speak negatively, but there's other good firms Like we. Like our mission is to say how can we make this the best place to do that, the place where you're going to be to go? So, short answer LinkedIn is probably the easiest. I mean, people can follow the YouTube channel. It's just James Canole. It's not like a place where I'm interacting a whole lot with people. That would be more so on a LinkedIn Instagram even like I'm so inactive on there right now.
Speaker 3:But there's some stuff for 2025 that we want to roll out to that how do we start connecting more?
Speaker 3:I don't know, I think of root in some ways is like obviously we're a financial planning company, but for first and foremost like my mind says more like how can we be a people development company and then even like a media company and like that's the focus of like we have the talented technicians and we have the head of planning, we have the structure, we have these things like yes, we're going to keep getting better and better and better and bring on more and more resources for our clients.
Speaker 3:My vision is that how do we make this a place that, like I think it's Chick-fil-A that talks about that Like there's a Chick-fil-A operator as a client is like I don't view this as like a human development company. Like you're going to come here and you're going to be developed and you're going to walk away a better person than when you came. And I hope when people walk away from Root, it's because they're retiring and like they could spend a whole career here if they wanted to, but they're like, yeah, I'm a better person after that. And so there's a lot of plans of things that we want to do on that, but follow along. Linkedin is the best place to get updates there.
Speaker 2:Love it Well, James. Thank you so much for your time today and insight. Lots of goodies in there, so can't wait to see you on a future episode.
Speaker 3:Awesome. Well, thank you guys for having me again.
Speaker 1:Thanks, man, always good to see you.