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Reality and Your Pipeline to Prosperity

Reality and Your Pipeline to Prosperity

00:00 01 February in Articles Written by Jon Henschen

by Jonathan Henschen, CFS and featured in Broker Dealer Journal
February, 2008:

If you’ve been recruiting for even a short while, you’ve realized that the prospects in your pipeline are your lifeblood. You may believe by now that on your prospect pipeline hangs your every hope for the future. And by now, you may even harbor the common misconception that every prospect in your pipeline will eventually entrust his or her professional future with your firm.

If That’s So, Dream On!

As time goes by and the real world looms, you’ll know what you can do with all those dreams. Namely, divide them by two and then some. Only then will your grandiose expectations come within waving distance of reality.

Sure, your share of pipeline prospects will come your way; but others will go elsewhere. And you can stew all you want over why all those advisors you’ve been wooing are no longer clamoring to join your firm, and fret over just what those other firms have that yours lacks. It’s only natural to blame our firm for whatever may be lacking, rather than admitting the reason may be just a wee bit closer to home.That Is, Something We Did Wrong!

Broker/dealer recruiting is different than other financial sales jobs I’ve seen or done, including wholesaling and advising. For one thing, recruiters have to be jacks-of-all-trades, displaying knowledge about every part of a broker/dealer. And then there’s the varied paces at which you’ll be expected to operate. It is up to you, for instance, to adjust to a pace that will make your head spin one day, but which is akin to watching glaciers melt the next (except in Al Gore’s world!). Then there’s the fact that many of the traditional sales techniques you’ve learned about wholesaling and advising are worthless when it comes to recruiting; some can even be counted on to drive more advisors away than they attract.

What follows is my take on broker/dealer recruiting in the real world, beginning with how best to create and work your prospect pipeline.

Forget Those Phone Marathons, Try Two Meaningful One-Hour Calls Per Day

When I was an internal wholesaler in the 1990s, our manager would exhort us to “make 200 calls a day!” What nonsense! I’ve long since learned that recruiters make a lot more money with a couple of meaningful one-hour calls a day, than with 200 two-to-three minute calls filled with trite sales techniques and transparent manipulation. I figured if I was going to enjoy recruiting and be successful, I’d better unlearn much of what I’d been taught as a registered rep and wholesaler. I did, and it has worked out fine.

A Career Changing Read

To help unlearn bad sales habits, I recommend Frank Rumbauskas’ best-seller, Selling Sucks: How to Stop Selling and Start Getting Prospects to Buy! (, $13.97). I found this to be valuable for all financial sales types; but it was only after a recent re-reading that it dawned on me just how many of Frank’s truths apply directly to broker/dealer recruiting.

Not sure about that? Here’s an example of how sales should be: “Selling is only necessary when you’re in front of someone who doesn’t necessarily want to buy from you. But when they do want to buy from you, everything happens so smoothly. When they want to buy from you, you don’t work against them. You work with them. When they want to buy from you, you don’t have to overcome objections. You simply fill a need. When they want to buy from you, they just buy—you don’t have to sell them.”

I’ve heard enough feedback from advisor prospects about conversations they’ve had with recruiters to know that coming off as a pushy sales type is a huge turnoff. Want to stand out in the dreary crowd? Try some brutal honesty about your firm. Prospects are so tired of recruiters droning on and on about their firms having the best of everything, that some objective honesty can be an instant bridge-builder.

Any way you measure it, honesty and constructive humility are more persuasive than boastful subjectivity. By being upfront about your firm’s weaknesses, the things you’re doing to strengthen those weaknesses and the types of reps that best fit your firm, prospects will appreciate your candor. And you will stand out in a very crowded field.

Working Your Pipeline: It’s All About Relationship Building

From your initial calls to prospects, to the day they sign the broker/dealer contract, working your pipeline is all about relationship building. I’ve learned that engaging in as many quality conversations as it takes—conversations that won’t turn prospects off—is three-quarters of the battle.

I wrote the article “It’s Not What You Say But How You Say It,” for Issue 10 of this publication (available as a PDF under “In The News” on my website In it, I discussed the conversational blunders recruiters make that can be counted on to turn prospects off. Try rereading that article. It sheds additional light on irritating verbal patterns you may be using that are getting in the way of bringing on qualified prospects to your firm.

A Working Recruiting Pipeline, I think you’ll also find this four-phase model pipeline as valuable as I have:

  • Initial Contacts
  • Proactive Follow-up
  • Home Office Visits
  • “Dripping”

Initial Contacts – First impressions are the most important and quickest way to win over qualified prospects. Get them talking about their favorite topics: themselves and their businesses. The conversational ratio I’ve found to work best is ¾ them; ¼ you.

Use initial contacts to learn all you can about their practices, hopes and dreams. That’s how you can realistically match prospects’ needs with your firm’s benefits. If those early conversations go well, try an up-front mention of the value of prospects visiting the home office. In any event, never trust your memory: use a contact management system for detailed notes of conversations with prospects, along with a record of the information you’ll be gathering. On follow-up calls, those notes will help you come across as an interested, well-prepared professional. In other words, a winner!

Proactive Follow-up – Consistent follow-up after Initial Contacts

is where many otherwise heads-up recruiters drop the ball. We’ve actually seen firms send out their marketing kits, but then wait for prospects to call. On the flipside are the firms that promptly send out marketing kits after Initial Contacts, but instead of waiting, they get busy making follow-up calls and arranging home office visits.

Guess Which Firms Bring On More Advisors?

Try some proactive follow-up techniques to avoid being caught up in endless rounds of telephone tag. One effective idea we’ve used is phoning prospective advisors’ assistants to schedule follow-up conversations. Most recruiters have no trouble leaving messages, but too few take a simple, proactive follow-up step like that. Last month, for example, I had a couple of conversations with advisor prospects that clearly revealed the importance of being proactive with follow-up calls. Here’s how they went:

Case 1

Me: So where are you with making that change we talked about?

Advisor: I guess I’ve decided to forget it.

Me: Really? Why?

Advisor: Because the two firms I’ve been looking at aren’t pursuing me and don’t seem very interested; I really don’t feel wanted. Also, moving would be a hassle, so I might just as well stay put. Either one of those two broker/dealers could have won this rep over if they’d simply followed-up, explaining the transfer process and the effect of a timely move on the advisor’s business, how much assistance they offer with the necessary paperwork, and while they were at it, let him know how much they wanted him! Neither bothered, which lead to a predictable result.

Case 2

Advisor: I’m calling you to let you know I’m going with XYZ broker/dealer!

Me: The last time we spoke you favored the other firm. What changed your mind?

Advisor: I haven’t heard word-one from that other firm since then, but XYZ’s recruiter has kept in touch all along. She’s a fiend about following up! They come across as a lot more professional than that other outfit, going out of their way to answer my questions and talking up why I should be making a move their way. Jon, they really want me!

Proactive Follow-up means pursuing prospects, making them feel wanted, important- that they matter…and that your firm will make them feel and be significant.

Home Office Visits – For many firms, home office visits are great closing tools. For others all they do is raise red flags to prospects. In Issue 8 of this publication, you’ll find my “Secrets of Successful Home Office Visits” article (also available on our website, Try re-reading it to be sure you’re getting the most benefit out of prospects’ home office visits.

Dripping – The Dreaded Limbo Lead! Nothing is more frustrating to recruiters than prospects that lack a triggering event for a move. It is truly like being trapped in limbo! Because large producers and producer groups tend to have such long decision-making lag times, this can be a recruiter’s worst-case scenario: All that production looking for a place to go, but no timeline driving the decision!

Tired of Waiting? Try Patience and Persistence

Those seemingly endless waits can be so unnerving; recruiters frequently give up in frustration. Rather than bemoan those tediously long waits, try being patient and persistent, even if it hurts! You will soon find, as I did, how critical those two character traits are for a recruiter. “Dripping” (as it’s called) on no-timeline prospects with quarterly, semi-annual or annual conversations will keep you in their thoughts so that when a triggering event finally does dawn on them, they’ll call you first.

I recently took a call from a prospect I’d been “dripping on” since 2001! Every November, like clockwork, I’d call to share deer-hunting stories (we even exchanged deer trophy photos back in 2003; seems like an eternity ago!). Most of those drip calls were more about deer hunting and family; business factored only briefly into many conversations. But, each call I made counted for something, if only to allow me to keep building a relationship that could one day pay off.

Like most long-term drip leads, this particular prospect is a very big producer with several reps in his group doing a couple of million dollars of production. When he eventually called, he was characteristically direct: “Hey Jon, we’re ready to move. Let’s go!”

Was it worth my time and effort? You better believe it was! Then there’s this: When you drip and your boat comes in, they’ll feel too guilty to not call you.

Reality & Recruiting Pipelines: Getting it Right

As a rule, broker/dealer management should be judging recruiters by their pipelines and how those prospects are being worked, not by the immediate business being brought in, especially during the first year or two. It’s not uncommon for recruiters in their first couple of years with a firm to bring in advisors with just $2 or $3 million of production. At the same time, those same recruiters can be developing fantastic pipelines of large producers and producer groups that—if worked proactively–can be counted on to bear fruit over the next year or two.

Management often live cloistered lives; experienced recruiters are on the front lines, hearing the nitty-gritty from prospects about gut level issues that can either draw reps to you or start them looking elsewhere. So smart managers check in with their recruiters at least once or twice a year to find out what’s happening in the industry, who the players are, and what’s been attracting reps to other firms.

As for recruiters, prospect pipelines are as essential to your success in this business as they’ve always been. But quit day dreaming. Instead, try being realistic about what they can and cannot do for you. Better yet, don’t just sit there waiting for your ship to come in, go out and get it!