Client book transaction marketplace launches

24-Apr-2017

By Daniel Paperny

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A new online marketplace aims to help financial planners and brokers buy and sell client lists with a greater degree of transparency and choice.

Known as ‘Buy My Clients’, the website, which is the brainchild of National Australia Bank and Mercer alumni Emanuel Millen, provides a platform where would-be buyers and sellers can learn more about the value of client lists they are interested in buying, and seek professional advice when preparing contracts.

Speaking to financialobserver, Millen said the new website would help democratise the process of transacting client books, which has historically been the purview of brokers charging commissions of up to 8 per cent.

Millen noted that while approximately 400 financial planning books were sold through brokers each year, the existing marketplace suffered from a lack of transparency over the interest in a client book being sold, as well as an over-reliance by practitioners on their existing and limited networks when making transactions.

“The traditional way of selling the book is to make people aware of it through your network or to go through a broker and the downside of that is that you don’t know if you’re getting the maximum exposure that you could have for your book,” he told financialobserver.

“The benefit that I’m providing through this resource is to create an open and transparent marketplace which would make it more efficient for people to transact client books and plan their businesses without having those sorts of restrictions and a fear of missing out on valuable opportunities.”

According to Millen, the financial planning industry was in a state of flux particularly given the incoming professional standards regime for advisers.

“The average age of advisers is around 55 to 60 and many are looking to exit the industry so the buying and selling of client books is likely to increase significantly over the next few years,” Millen said.

Millen said the platform was developed in response to industry feedback, and enabled buyers to search for appropriate client books, create alerts to be notified of new listings, shortlist favourites and contact vendors via secure messaging.

“We’ve created an alerts system where people can register to be alerted when books become on sale for a particular category or location; it frees up their time without having to look around for different books,” he said.

“The platform might mean a slight change in the business model of some brokers but in the long run it will be a benefit for everybody.”

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