The Unstoppable Accountant - Grow your Accounting Firm
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Hi Arun here, in this podcast I will happily share my ideas, successes and failures in growing my businesses, investment ideas, and juggling this all in a rapidly changing world.
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Arun
The Unstoppable Accountant - Grow your Accounting Firm
Building a Thriving Commercial Finance Division in Your Firm
Unlock the secrets to enhancing your accounting firm's service range and client satisfaction with commercial finance expertise. Join us as we chat with Nigel, who has been at the helm of Samera's commercial finance operations since 2016. With his extensive banking background, Nigel shares the initial hurdles faced and the significant growth achieved by integrating commercial finance into an accounting firm. Learn how the independent nature of brokers can offer your clients bespoke financial solutions that surpass what a single bank can provide, and why this approach has been a game-changer for Samara and its clients alike.
Moreover, discover from Simon, a seasoned property expert and developer, how blending property expertise with commercial finance can attract new clients and convert them into loyal accountancy clients. We explore the benefits of outsourcing finance services to specialists to ensure quick response times and high client satisfaction. Nigel and Arun also emphasize the importance of patience and momentum in establishing a thriving commercial finance division, and they offer practical advice for those looking to start their own FCA-regulated brokerage. If you're ready to expand your firm's horizons and add an invaluable revenue stream, this episode is your essential guide.
Okay, welcome. Hello everybody, this is Aaron from Samara here, and today we're going to be talking all about commercial finance, and I've got my colleague Nigel here. Hi Nigel, how you doing? Hi Aaron, yeah, I'm fine, thank you.
Speaker 1:Good, good to see you Now. Nigel's been working with Samara since 2016. And he heads up our commercial finance part of the business 2016 and he heads up our commercial finance part of the business and what. The whole point of this kind of call or webinar today is to discuss why you should add a commercial finance part of the business to your accounting firm.
Speaker 1:Now, when I started off my firm many years ago, I didn't have a commercial finance part of the firm. I was an accountant doing accounting work. But I always saw an opportunity to say, well, clients need money, clients want money. And occasionally we'd get the odd deal through and we'd pass it on to a bank that someone I knew, and the client gets the money and never hear anything back from it again. So I always thought in the back of my mind there must be something better, a better way of doing this. And, lo and behold, I met Nigel and I guess the rest is history. So, nigel, do you want to give a little bit of a potted history of what your background is and how you got into the fray of Samara Finance? And yeah, let's just take it away.
Speaker 2:Yeah, okay, thanks Aaron. Yeah, let's just take it away. Yeah, okay, thanks Aaron. Yeah, I suppose when you say history, it is a history. And bear in mind, I joined NatWest Bank in 1976, which is quite a while ago, and that was only a temporary job.
Speaker 1:I was only three. Sorry, I was only three then. Yeah, I know, it was a temporary job.
Speaker 2:I was only doing it while I decided what I wanted to do, so that's for a long time. Um, so yeah, I suppose I've been in banking a long time and I've gone through all the jobs. I started in the machine rooms cashier. I then went and become a runner for a manager, which was a very informative job. Um, I worked in the in the bank's collections department. I worked as a commercial manager. I've worked in what was called the specialist relationship department, where customers are having problems and we tried to help them out of those problems.
Speaker 2:And then about 10 years ago well, 10, 15 years ago I was appointed to the healthcare team to run the healthcare team, which was about 20 managers in those days in the south-east of London, and that's when I first really got into healthcare. And that's really where I met Aaron, because, as Aaron just said, he occasionally passed deals through and occasionally, I think we met at some show or something. It was a chance meeting. And then he would phone and say, oh, I think we met at some show or something, it was a chance meeting. And then he would phone and say, oh, I've got a client he needs to do this, can you help them? And that's how we got together.
Speaker 2:And then eight years ago, the bank decided to go through yet another redundancy process and they offered me interest in terms.
Speaker 2:So I left and I joined Samira and we set up Samira Finance, which you know, to be quite honest, when we set it up, one man band.
Speaker 2:When we set it up, the first year was difficult because we didn't do a lot of deals but we did a few. But it's gone from strength to strength to strength and we now employ three or four people, um, all ex-bankers, I'm pleased to say with the knowledge to help people to source the finance they need. So that's really where it came from, um, adding it onto the accountancy arm, samira, and the experience that aaron has from running practices himself and starting up practices was has been very useful because we've got that first-hand sort of knowledge and obviously we brought with us all the information from the banks as how to set things up, how to work things, and over the eight years we've built up incredible contacts with all the major lenders. So we've got about eight or nine major lenders, we've got asset finance providers, we can do tax, and so the breadth of services we offer has grown considerably over the number of years.
Speaker 1:Okay, thanks, nigel. So if I go back to when we decided for you to, when you joined the team, back then, as you said, it was a kind of blank sheet of paper. We had an idea that people need to raise finance and we focused predominantly on the dental sector, whether it's for people to buy a practice or set up a practice or for equipment or set up a practice or for equipment. And for our accounting firm, it's kind of transformed it in many ways. It's really added a new range of services of commercial finance to clients, and that's only a good thing for our firm, not just from a business point of view, but also for the client, so the client doesn't have to go somewhere else. Um, the accountants in our team will liaise with the finance guys in the team, ie nigel, dan and others, if they need to. Um, so, from a client perspective, in your mind, nigel, what? What are the main benefits for the client? Not necessarily us, but for the client?
Speaker 2:I think for the client, it's the independent nature of the broker.
Speaker 2:So, whereas before, perhaps the accountancy firm or the IFA firm would refer you to someone they know in a bank and you'd go to that bank, it might not be the best deal for you, it might not be the best structure, it might not be the best rate and, conversely, it could be the best deal for you.
Speaker 2:It might not be the best structure, might not be the best rate and, conversely, it could be the best deal for you, but you're taking that chance, whereas I think what's happened with your clients, aaron, is you refer them to us and we go out to many of the banks and we get several offers of finance on the same deal. Gives that gives the client a chance to look at the different offers, because it's not always about what the cheapest rate is, it's sometimes about the terms that are attached to it. So it gives it gives the the client um a much better inroad into into the banking world and and it's independent and he gets, he gets multiple offers so he can see what's out there and see what suits them best. I think that's really what what the benefit to the client is, because they get the best deal that they can probably get yeah, and I think what you mentioned is the word independent.
Speaker 1:Okay, independent is really a key thing here, because if I refer it to one bank and that's my only contact, the client isn't really going to get the spread and breadth of saying, well, is that actually a good deal? Aaron said it's good, but do I really know it's a good deal, to be honest with you, so I think that really really helps. So now, in terms of the range of finance that we offer typically, what kind of stuff do we offer clients?
Speaker 2:well, obviously we we offer purchase finance, so that's that's a big one. Uh, we we offer startup finance. We were able to sort of start up finance or start up practices squat practices, which a lot of people still don't understand. They can go to banks and and get money over 15 years rather than borrow it short term. We do quite a lot of refinance, especially when when the rates are going up and down, and we do quite a lot of refinance taking people off deals they perhaps took at the outset without that independent advice and we put them on a better deal. There's also asset finance, tax finance you can finance your tax payments over a year and and really it's sort of all sorts of finance.
Speaker 2:So you know, we work mostly in the dental market. We deal, deal with pharmacies, vets, gps as well, and occasionally we get an old customer of one of ours will come back to us to ask us to do something. That's a bit unusual, a bit outside the healthcare industry, but generally we can source finance for most things that are related to the healthcare industry. And we do property as well, correct? Yeah, we do property as well. Yeah, so if you want to buy the practice property or or you want a commercial property of any sort. We have a property expert on on site, uh, simon who used to work with me at rps, as did everybody else over the years, um, and he's got he's got 20 or 30 years experience plus. He's also a developer in his own right, so he understands far more than I do about developing a site and a property. He understands all the problems that you can have, so we've got a lot of knowledge on the property side as well.
Speaker 1:Yeah, okay, so we have a whole breadth of experience to share to clients. So if I now stand as an accountant in my accountant's shoes, so what's it added to my firm? So I alluded to this in a LinkedIn post the other day. But what I've found as an owner is that people rarely want accountants. Okay, they know they need an accountant, but they don't really want an accountant. It's like, oh God god, they have to file my taxes. It's. It's never good news. I usually think an accountant is okay, but what I've found is that over the years that people business or new business owners they want money. Okay, they don't want an accountant, but they want the money. Because why do they want the money? They want to create the business of their dreams.
Speaker 1:So what I've found over the years is that as we offer finance and commercial finance as an offering, people come to us. They talk to nigel, dan simon, whoever it may be in the team to to raise their final, to try and get their finances to secure their future. But at that point then, as a an accountant, we can step in and say, well, hold on a minute. You've spoken to Nigel. Nigel said, well, you need cash flows, you need forecasts. You need accounts, whatever it might be. Talk to Aaron or talk to Natasha or talk to whoever to get this done. So what we've found is that it's a really helpful route for us to get good quality clients, or good quality accountancy clients, if we've got them on the financing side. So that's been a real benefit to us as a firm.
Speaker 1:Of course, not all clients will come on board, because they might have existing relationships with accountants or whatever it may be, and that's absolutely fine as well, but it's always been quite a good way for us to get new clients.
Speaker 1:Now, in addition, I think the other side of the coin, which we haven't even talked about it there are fees that we receive from clients for the work that we do in terms of the commercial financing, which can be sizable. The bigger the deal that borrowing, the bigger the fee we typically get. But I also appreciate not everyone has a Nigel on their team, not everyone has a Dan on their team. It takes money, it takes time, it takes effort, it takes risk to do that. So but you might be thinking well, I actually do an offer of commercial finance offering to your clients you're an accountancy firm. You might be doing what I used to do, refer to the odd bank you there, but you don't really know if it's a good deal or not for your client. So, nigel, how can accountants who may be listening to this now or in the future kind of benefit without having to take the risk that I did by getting you guys on the team?
Speaker 2:Well, they benefit. Really, in a sense it's outsourcing, isn't it? They're outsourcing the finance arm to someone who knows what they're doing and gives their client, hopefully, a good service. We say we give a good service, we're the proof of the pudding, etc. But you know, I think the benefit is that if you've got a happy client and you've helped your client, then then you've got a much happier client with what, what your services actually are, your accountancy services.
Speaker 2:I think it's important to sort of stress as well that if you refer to as a client and he's an accountancy client or an ifa client, then, um, we would not, we would not attempt to take that client away from you in any way. Um, we are, we are there just to do the financing arm of it, but it gives it gives sort of such an opportunity. So I mean, we've got a buying group that they can go on as well, and most dentists can go on a buying group and save costs. So you're adding things to your own accountancy services that you couldn't possibly add because of fca regulations and everything else, and and you'll get, you'll get in all those services just by making a referral.
Speaker 1:Yeah, correct, correct. And I think monetarily they get some money as well, correct, Nigel?
Speaker 2:Yeah, we make an arrangement where if you want to take a portion of the fee, we can make that arrangement. I think quite a few accountancy clients we have a few now who are introduced to us and it's it's the benefit, it's the the speed of our response. We are, we are quick to respond to clients. So because I think most accountants and solicitors find this, that when a client comes from for finance, it's normally because they need it now yeah yeah, it's not because they're making a plan two years in the future.
Speaker 2:This is normally oh, oh. Yeah, I thought I better check with my accountant and, um, all of a sudden, they want, they want it moving forward and and so, yeah, you get. You get that speed of response as well and and building a relationship, really building a relationship with your, with your own accountancy team, and whilst we're saying, we're saying come, if potentially people want to refer to us, great, we can work out an arrangement and pay a fee.
Speaker 1:What if someone wanted to say do what we did, okay. Um, your top three tips like how would they go about setting up their own fca regulated commercial, commercial finance brokerage in a nutshell I know it's eight years worth of experience, but in three quick points how would they go about doing it if they needed to?
Speaker 2:Well, first of all, I've got to be careful what I say. I think you need to find a good person. Hopefully we did. You've got to find someone with a bit of energy and enthusiasm, because it is a hard slog. And I think you've got to be patient because you're not going to get 40 deals in year one. It takes time to build a reputation. It takes time to sort of build the contacts. You really do need someone who's got the contacts in the banks, who's you know, I suppose been around a bit and knows people and knows who to talk to and where to go to.
Speaker 1:Yeah, okay, all right, perfect, so we've been talking for 15 minutes. I wanted to keep this call or talk webinar short today. In summary, nigel, what would you say to anyone thinking about doing it adding commercial finance to their accounting firm?
Speaker 2:I would say do it because you're adding an additional service to your clients. It's not a lot of effort on your part. You're passing the details over and perhaps the conversation that you've had with a customer. You're getting a much happier client. You may get more work out of it because there may be limited companies to to create for property transactions and all this sort of thing, and and obviously you may get some, you know, compensation in the way of payment, um, but I think really what it is, it's just adding that extra service.
Speaker 2:It's what we did at samara. We moved it from being an accountancy firm into being sort of a one-stop shop for for the actual customer, and you can do that as a as a referrer, without doing a huge amount of work. It's a question having a chat with me or aaron, setting up a relationship, setting, setting up a system and then moving forward from there, and so your client can benefit, your firm can benefit and really obviously we're going to benefit. Everyone benefits. So at the end of the day, you've got to look at it and say, why would I not do this? Why would I turn a client away and say, no, I can't help you with that?
Speaker 1:Perfect. I think you summed up perfectly there, nigel. And then, just from my own point of view, it's it's been a real, real great avenue for new clients having commercial finance. Obviously, it's another income stream to my firm and, as Nigel said, if anyone is thinking about this, whether they want to have a chat in terms of referring to us, or if they just want a chat in terms of referring to us, or if they just want a bit of guidance of how to do it themselves and set it up themselves, just reach out to me, reach out to Nigel, and we'd be delighted to help. Okay, and in a nutshell, add commercial finance. It's something that people want and it's a good income stream once you get the momentum and you have a little bit of patience as well. Well, thanks very much today, nigel Pleasure and thanks everyone. I hope you found that useful and get in touch if you need any help. Thanks, thanks, aaron.