Hiring the next generation of advisers
With Alisdair Barr, founder of Striver.
Matt Heine: Hi, and welcome to this episode of Between Meetings. Our guest today has had a very varied career and done more than probably most people I've met in the financial service industry. He's worked for licensees. He's currently set up his own startup and he's helped to bring through the next generation of advisors. It gives me pleasure to introduce our guest today, Alisdair Barr.
Alisdair Barr: Thanks, mate. Nice to be here.
MH: Now we were just chatting before, but you really have had an incredibly varied career and I'm interested, how did it all start? How did you decide to get into this industry or was it actually just by chance?
AB: Yeah, absolutely by chance. I think like most, too, I'd been on exchange in the UK and I got back to Perth, my hometown, and I was washing cars at Volvo and picking grapes in Margaret River and couldn't get a job with my wonderful marketing degree. And the only thing I did well at university was finance so I enrolled in what was called the Securities Institute at the time, some might remember, in F for financial planning. And that day, I went and wrote 12 letters to 12 small firms that had financial planning in their title in Perth and said, "Let me come and make you cups of tea for two weeks, give me a go," and one did and they employed me and history is there so a small firm in WA is where I started.
MH: Interesting. One of our recent podcasts with Paul Heath from Koda Capital, that was almost exactly his story, Perth boy, got his degree and then yeah, started writing out to firms so it's a hotbed of talent apparently.
AB: Yeah, Perth, boom town.
MH: Boom town. So how long did you stay in the UK for?
AB: So I did a year, so I went and finished my marketing and tourism management degree at Napier University in Edinburgh. So I did that for the first six months and then sailed boats and worked in security jobs and hustled, worked at pubs and sold door to door and did all sorts of different things as you do. And then I had to come back to Perth for my sister's wedding and I couldn't get my sort of job after university. So I knew I had my tail between my legs, I wasn't going back. But I had a good time there, but getting back to Perth was a stepping stone into what was to come next.
MH: And what was the firm that you ended up working for?
AB: They were called Winthrop Securities. Don't think they're around anymore, but it was a good learning. I think every step in those first kind of five years of my career and the sort of three or four businesses that I worked in, learned a bit more. Whether it was good, bad or ugly, they were all really good learning curves. Probably looking back, that was where I learned most really quick. So that wasn't the greatest firm longer term, but I learned a lot and then moved on from there.
MH: So how did you end up from working in a practise in Perth to moving into licensee land?
AB: Yeah, so then I came to Sydney, I moved to Sydney. I just sort of did 12 months there, wrote a bunch of letters to Perth, after Sydney and Melbourne, sort of like I've now got 12 months' experience up my sleeve and I ended up working at a firm called [inaudible 00:02:57], which was part of Fiducian I think back in 2001 and sort of spent 18 months there and said no a handful of times and eventually, said yes to go and work in the paraplanning unit at Colonial First State, which had just been acquired by CommBank. So I kind of went into Colonial First State, which was rolled into CommBank that day.
And then so I was going to go and work in a large organisation for about six months. I had no interest in being in a large organisation. The small organisation just didn't really help me plan out my career path, the way, well, it didn't sort of deliver on the promises that were made or I felt that. And so, this is probably now thinking, looking and that's probably where we're evolving to where we've evolved to today, but that didn't sort of match my thing. So I went to a big firm because they offered me a job in CommBank and I was only going for six months, but I resigned from there nine and a half years later. So things kind of changed when I got in there.
In this podcast series Matt Heine, Joint Managing Director of Netwealth, chats to industry professionals and thought leaders on what opportunities and challenges they see for financial advisers and the wealth industry as a whole.
MH: I'm guessing you didn't do paraplanning for nine and a half years. What were some of the other things that you did whilst with CommBank?
AB: So I started in paraplanning and I was kind of I tried to be the most efficient and accurate and diligent paraplanner with the best relationships with my advisors I possibly could and I did that for about 18 months and then eventually, got identified by a guy by the name of [Ross Elsley 00:04:16] Who was the general manager of retail banking for country, New South Wales. So he looked after all the branch network outside of Sydney in New South Wales, and all the branch managers in the area and managers and so forth, and I had this financial planning arm, which was very entrenched in the retail bank back then. And then so, they were pulling it out and they wanted somebody who had no or hadn't knew what financial planning was and was technically competent, but could come and have a look at how it was done differently out of the retail bank and what could be improved.
MH: So what was the thinking at the time? Why did they want to separate the two?
AB: Well, I think the logic of it being inside the retail bank was that's where the customers were at, right? That they were quickly realising that advice on a home loan or a credit card was very different to advice in superannuation and insurance in that, and we all know that. So that they didn't want ... They knew that they couldn't have the financial advisors managed by a home loan process. And so they worked, they've probably gotten in and out of that a few times, but at the time, that was the main calling. So they wanted to have a specialist management running, working with the financial planners, still maintaining its relationship with the retail bank.
MH: So it wasn't pulling the planners out of the branches or such. It was more that they just had separate reporting lines in a separate business unit?
AB: Yeah, which created its own problems. So you have a different reporting line inside a network, but having to sort of ... Yeah, being visible in a branch definitely and then country, New South Wales was one team or in regional areas and everybody's, they're all at lunch together and so it's very, very much one team, but a different a line management. So that's what they were doing.
MH: Do you remember how many planners they had at the time?
AB: Oh, anywhere between 700 and a thousand I think nationally, yeah.
MH: And did they typically come from the bank or where the financial planners originally have been sourced?
AB: Yeah, I think so. Back in that stage, they probably ... Yeah, probably. Especially in country, New South Wales, they were homegrown in the region I would've thought.
MH: So we might come back to that in a little while just around how we are going to or where the next generation of financial planners is going to come from. It's obviously something that you understand and know well. So if we just keep going with the journey, so you were managing financial planners that were operating out of retail banks.
AB: The bank was really good to me. They put me on all their career development programmes and everything like that so that was great. They really supported me and they started me off my MBA and so forth. And then, I ended up getting asked to go and become the national sales manager for our third party mortgages. So I knew nothing about home loans, but that relationship, management roles, looking after the 12 biggest clients of the third party distribution, what was just a division at CommBank, which was great. I was, well, I don't know, maybe 28, 29. It was a great role. It sent me around the world and got me a lot of presenting and managing big relationships and ...
MH: What sort of clients did you look after? Aussie John or ...
AB: Aussie, IFG, the likes, so it was sort of my responsibility was to look after and make sure that we sort of supported maybe the top 15 distribution groups or aggregators in the market. So yeah, they were our clients. So that was really great fun. I'd speak at lots of conferences and do a lot of sort of negotiations with the bigger end of the market. And yeah, I got thrown completely in the fire as a 29-year-old so I learned a lot. In both of those roles, I learned a lot as a young ... Every time in my career, I've been stretched beyond what a lot of people thought my capability was, but quickly learned how to get in there.
MH: And from selling mortgages, you then ended up back in advice?
AB: Yeah, yeah. And then in Colonial First State, they were looking at ways to retain their really good salary-based advisors. And so what we did is we built a franchise model within the Commonwealth Bank dealer groups where employed advisors could set up their own business and manage that and still add care to their clients, and we'd structure it in a way that they were more incentivized to look after the client and to get a new client. So that sort of changed the dynamic and it really started them moving down the track of becoming a good business person. So quite often, a technician in any industry is a great technician, but the pathway to being a great business owner is quite a long steep one. And so that was a part of taking them on that journey-
MH: Is that the pathway programme?
AB: Yeah. Yeah. So unfortunately, that hasn't sort of seen its way into fruition, but that's long since I've left so I put my hand in that, but ...
MH: So how long ago, this is what, 10 years ago?
AB: I've been out six years. So I started there, I did my last four years at CommBank in there. So about 10 years ago, we set that up and I helped build that and run that for four years and then, six years ago, I left. So yeah, that was around that. So I did nine and a half years up until I left six years ago.
MH: So given what we know now, and obviously, off the back of the Royal Commission, if you had your time again, were there things that you saw happening or that were put in place that you think could've easily been avoided?
AB: Oh, that's a tough one, man.
MH: Maybe not by yourself, but ...
AB: Yeah, I don't know. I think I certainly didn't see things that ... Yeah, but hindsight's a lovely thing, but I don't think anything was done at the time that was kind of like out of line or out of whack or anyone was doing anything wrong that was sort of was really visible. So it was more in hindsight, you can see systems and processes and things like that, which might've been wound up or, it's really easy to look back at REM structures and how things were happening and going, "Oh, well that was a glaring issue." But at the time, it wasn't like that.
Our number one focal ... I'll often say like we made a difference to Australians all day every day and for every 10 bad ones, there's-
AB: ... 9,000 good ones. So, yeah, but they're big businesses, too, right? So the hard thing around big business is making sure that you keep really close to the client. And I think that's what the beautiful thing now and looking at what's happening is we've got a lot of these businesses setting up and running small to medium ... Well, I don't even like the word small, but businesses that are really focused around the client and close enough to the client to really understand the client. Technology is making that better and so forth. So the bigger a business gets, if they're not engaging with technology to keep close to understanding the client, then these sort of things happen and they're big businesses.
MH: Do you have a view on that comment around what the ideal size of a business is so that you can stay close to a client? Is that often people talk about being able to hold a relationship with a hundred to 150 clients or 40 family groups, does that ring true and how do you actually then scale that?
MH: Because that's part of the issue I guess in the industry.
AB: Yeah, that's it, right? So I think that a lot of people are saying, "Well, I can't have a thousand relationships?" And I think you can, I think technology is a wonderful thing, but if you're running a ... If you'd ever look after a household, [inaudible] and pick up the kids and things like that, then that's a very different business model, too. But you've got to be able to pay for it, too. So if you learn to run 40 clients, then you need to be able to charge 40 clients and the business model, it's going to be key person dependent. It's hard to take that away from it.
I think though with technology, as long as you have it set up really well that you should be able to know your clients better and do it to more, if that makes sense. I think technology is along with the way that you've established your business, you should be able to scale it up. So I don't think there's an ideal number, but the business model is different, right? If you want to run a hands on approach and you can charge realistically for it, and then people run really great businesses doing that. But if you want to scale, then I don't think there's a number on how many you can look after.
MH: Yeah. And you're right, it comes down to the business proposition, and do you want to have a relationship with a thousand people and a shallower relationship or really get into it?
AB: Yeah. And a lot of the clients we work with now are really hands on businesses and the talent that goes in there really gets an amazing experience 'cause they see every part of a family unit from every component or we're doing advice online and scaling it up and the contact's not as much.
MH: So it's probably a good segue into I guess the next stage of your career, really around the talent or acquiring talent. Before we kick off though, do you have a view at the moment on I guess the likely numbers of advisors that are going to leave the industry because that's clearly going to have an impact on the world that you live in?
AB: Yeah. So what, for the last 12 months, we've been bantering around this number, about 1400 a year, over five years or something like that. And I don't know, maybe ...
MH: On a gross or a net basis?
AB: Like I said, that's just a gross going out, right, so if that's ... and then how do we replenish that is the question that I'm sort of trying to solve or answer for. So I believe there's probably going to be a need for about 500 ... So if it's 1400 going out, then we're going to have some consolidation, some efficiencies, so the net number will decline. But if it's going out 1400, I think we need 500 still per year for the next five years. I think that's kind of roughly the number I would think. So you find ...
MH: Coming back into the industry?
AB:: Yeah. So then you're netting out 900, yeah, for a period I just think while we rationalise a bit, and so what I think you'll get as we're seeing is a lot of the businesses like, that you guys work with who are small and nimble and really client focused and are not aligned, who then will be in a position where they'll join or merge or purchase a whole bunch of other little businesses. So you're going to get these kind of groups of businesses that sort of start to get a bit of scale.
AB: Yeah, so staff numbers will drop out of there, efficiencies will increase, but then they'll need people and so they'll grow. Obviously, the big organisations are sort of out, so we've got consolidation of firms. Technology will drive down the need for people for a period until we work it out. And probably one of the questions I'd ask you back is that what are the roles in the firms other than just client facing into the future? That would be what I'd run a podcast on with you, I think because then there's ... So then you get these firms with key advice roles, but they need a marketing department, they need a tech department, they need all these other sort of roles and customer service departments and so forth so-
MH: So what you're saying there is that the firm of the future is going to look radically different to what we see today?
MH: And can be because the firms are going to be larger and more profitable?
AB: Yeah, yeah, yeah, I think so. And obviously their core expertise is in the advice that they give, but because that'd be so streamlined and so automated and so forth, because we've got really sharp marketing, and 'cause we've got really sharp data understanding, 'cause we've got really sharp tech, we'll be able to do, provide better service to more clients at a better cost.
MH: So I love the conversations we're having at the moment. I think there's a general vibe if you like in the industry that they're feeling letdown by technology providers and the promises that are being made. The firm that you just talked about, how far off in the distance do you think that realistically is? Is it five years, 10 years?
AB: I think that it's like a comment that I get all the time or a question I get all the time. We have businesses say to us, "Oh, we need someone with a technology degree or someone with a marketing degree." And I think what we're trying to do is stopgap a problem without really understanding the problem. And technology is no different, right? So like those, an old holiday home that's 30 years old and been renovated every three years, they start getting really inefficient and at some stage, you got to bulldoze it and start again.
AB: And I think technology, ... And as a small business, I'm kind of really sharp on this because I'm a small business owner, right? So if I have somebody come in and talk to me about marketing or come in and talk to me about tech, I'm sitting there anxiously waiting for them to put this ridiculous proposal with lots of zeros on it, which distract me, and worry me, and concern me around focusing on the thing that generates revenue for me. And I think that's all small businesses think about that now and go, "Okay, great, well, I know I need to do something around marketing, but I've got this firm's going to come in and they want a $50,000 proposal around doing all this stuff and I don't know if it's going to work," and so forth. So then what happens is they go, "Okay, we'll just do a little bit of it," without the end in mind and they start doing little bits and then they start renovating this old holiday home, right? So-
MH: And they don't see the return from it because they haven't gone at it hard enough.
AB: No, and they haven't built the efficiencies in it and it's not all integrated and so forth. So I mean we've gone out and just done the whole shooting match, but I know that that's a really hard thing, that and people, right, that and people, those are the two things that small businesses worry about. I know I need to do something around this. Maybe I don't need to spend $50,000 with a marketing or a tech agency to come in and help me this out so I'll hire somebody. And then you hire somebody into your business who generally has to be a junior person. And then you've got this whole starting point going, "Well, I don't know, but I've got my business acumen so they're not really understanding the problem and trying to solve. They might be able to code the thing together or do the research and what platform.
So I understand that I think it's patching up the holiday homes kind of the analogy that then just builds an inefficient product. And so it will get there and I think more be really good to see some businesses come in to the industry that can kind of efficiently and with a variable cost provide a kind of out of the box, but bespoke-able solution that a small business can start plugging into and get wins day one, right? It's not going to ... I don't think that we're going to have ... How many businesses are there in financial planning, let not alone ... We're not going to have 2,000 very, very different businesses. They're all going to be aiming to run very, very efficient solutions, which will look and feel relatively similar. Your diagram that you sent out with all the pretty colours and pictures on ... How many products are on that?
MH: Hundreds, and I think if you break it down, then it looks like advice practises are using somewhere between 12 and 15 different technology solutions to achieve the same thing and they're all different, and it's costing them an absolute fortune, somewhere in the vicinity of that $350 per user in the office just to cater for trying to solve pain points along the customer journey.
AB: Yeah. So I don't think ... we went through this experience with Striver and company design's been some things like that where it's a big exercise and it's an expensive exercise and you're asking your customers and trying to find the problems and you're hypothesis testing and all this sort of stuff. But that's what businesses who really nail the technology and constantly evolving and constantly deploying. And that's what real businesses who use technology efficiently do full scale. So then the flip side is how does a small business start working towards that?
MH: When somebody started, if you're a small business just starting out, it's going to be easier 'cause there's no legacy. It's actually how do you, to use your analogy, at what point does it make sense or can you actually bulldoze the house and still keep the revenue coming in and running the business?
AB: That's it, right? How do you bulldoze the house and keep feeding the staff and servicing the clients and so forth? So I don't think it's that far off. I just think that the solution providers need to understand small businesses are a bit better because I see it, right. I go, "Oh, that's good, a calendar management system. I'll bolt that in. Oh, great. That does my accounts and it does my invoicing for me. That's good." And they're all sitting together. They could all talk together, each other, but that then is just one step a bit harder and then, where have I put the client in this whole exercise and what's making it more efficient? And I think, yeah ...
I don't think it's far off to answer your question, but I think we just need to think about how we engage with it better. And there's some clunky products out there that don't make life easy and I think they'll get voted by the [inaudible 00:20:48].
MH: Absolutely. So going back to where we started a little while ago now-
AB: Where was that?
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MH: Yeah, so as a Grad Mentor, talk us through Grad Mentor and what that did or why you felt that was an important service for you to offer?
AB: Yeah. When I left the bank, I went and set up a social enterprise and what I worked out pretty quickly was that you can build a beautiful product that everybody loves, but no one buys. And so Grad Mentor was kind of the flip side of that and where had a lot of demand of people saying out of looking after a small to medium financial planning firms with inside the bank, how did you help find good talent? And I thought about my days of picking grapes in Margaret River and amongst the dugites and brown snakes and that it was really hard for me to find a role. And then, there's a lot of small firms out there looking for great talent and have us match that up. And it was kind of this demand that was glaring. So I just went out to Western Sydney University, shout out to Western Sydney University, and knocked on the door of a dean and said, "Can I find your final year financial planning students paid jobs?" To which they said, "Please, would you?"
And it kind of evolved like that and we started sending them all over the place and then started bringing them all together in these speed networking events and that was great. And then started producing content and talking around, engaging millennials in the workplace. And I think we put like nearly 400 students now into financial planning businesses. We were doing it in WA, but in Sydney, Melbourne and Brisbane for sure. And some of those have gone on to be equity holders and some really great financial planning firms and all sorts of different roles around the place. And so helping businesses small ... Sorry, I'm going to stop saying small, but financial planning firms find great talent and compete for great talent. And also, the big organisations, the ASX100 organisations are employing less and less people these days out of university. So there's a lot of students that have great talent looking for great places they can make a difference and that some of these financial planning firms are those places.
MH: So one of the interesting things you did was the speed networking events, which have been hugely successful. Why did you decide to pivot, if you like, towards that style of event rather than your traditional interview process?
AB: Oh, so we do that, right? So we do interview all the students. Even in the new world, all students are highly vetted and interview face to face, the whole shooting match so the quality is maintained. But what we found was that well, one, financial planners are quite social people that like ... so you can put on a couple of spring rolls and a glass of wine, people would turn up. And so we could create a showroom where we could put a whole bunch of young people who are looking for an industry or a career that was dynamic and exciting. And funnily enough, when you do put a dozen financial planners in a room in that environment and it's a positive energy, the energy goes up. So we created this environment where a business could see between six and 12 highly vetted, highly engaged young people aspiring to come into the industry. And they could sit down and meet them for six or seven minutes and know that they've been through a vetting process and short list and then interview them afterwards.
And what it's also, what that does too is it takes away ... You know when you meet somebody in an interview or face to face or anything like that, you're kind of within the first minute you're like, I like you or I don't. It just gives that environment, right? Like that's not ...
MH: Gets you an hour of your life.
AB: Absolutely. Absolutely. And so, when we do these events, we try and give everybody as little information about each other as possible and just let the magic happen. And then generally, they go, "Oh, I really like Matt." And Matt goes, "I really liked Allie". And they go "Oh, funnily enough, you both like each other, then let's have a formal interview." And therefore the time saving to the business is immense, right? And so well, they might not see it, but ...
MH: So they go from speed dating to a first date and then-
MH: Hopefully, there's a marriage somewhere down the track.
AB: Yeah, that's the plan.
MH: You did a great bit of research a couple of years ago about what makes a successful grad programme?
MH: And you touched on before, how do I actually retain millennials or keep millennials engaged. Without going through the whole white paper, which I think is still available for download from your website ...
AB: Yeah. Yeah. Yeah.
MH: What are some of the key points or key takeaways?
AB: Look, I think hiring the right person's what's special in a independently owned firm, we'll call that now, is really important and you need to focus on the person, not the paper. This is my big thing at the moment, when education standards are being bantered around as the biggest thing.
MH: It's still cultural.
AB: You can have them with the best degree in the world, and if they are culturally not aligned, it is going to end up in tears and it costs ... And that's the other anxiety point for a small business is making the wrong hire so don't get that wrong. Focus on the person, not the paper. And that's probably a new way of me saying make sure you spend time in that first stage. Don't pull the trigger. Strategically hire people. Don't tactically hire people. "Oh, no, someone's left. Oh no, we've got too much work on and we don't have capacity." That's every, that happens all the time to businesses. Really, we should not be overflowing with business before we think, "Oh, well, maybe we shouldn't have some more people in here." So that's the first bit.
AB: But then the onboarding bit and what do we do? Making sure we've got clear career guidelines, career plans, clarity, regular communications. There's nothing really new to it, but ... And you know what? I don't think there's anything difference between a millennial and a Gen X like me. I want clarity on how this is going to end up forward. I want to know what your contribution is. I want to know what my contribution is, what the expectation on each other are. So having that clearly mapped out, making sure that everybody ...
AB: Millennials are a social bunch, right? They use social media. They want to belong to a community way more than as Gen X who just said, "We can beat the path by ourselves. so no one's going to tell us what to do." These guys, they want to be a part of something. They want to understand what they're involved in. I'm looking at one now and he's like, "Yeah, that's right," so-
MH: That's not me, is it?
AB: Not you. So having some clarity around the purpose and that's what they want to know. They want to know the purpose of why they're doing what they're doing and how they're doing it.
MH: If you get that right, I think a lot of firms would think that they're a disadvantage being a smaller business to recruiting top talent or great talent. Is that a furphy?
AB: Yeah, complete furphy. And` I think, and this is, well, kind of my thing, right, when I started in small firms, I had no interest in going to a big firm. I stayed with a big firm 'cause they exceeded my expectations and I left a small firm 'cause they didn't exceed my expectations. And I'm a big believer in independent enterprise let's call it. And so started there and ended up there and did the big banking in the middle.
And so I think the conversation for a student or a millennial going into an independent firm is that you get exposure to the leadership. You see the client end to end. You're not a widget maker in a widget factory. You're closer to the profit pool in a business potentially, it can be financially better off. I mean it takes you a few years before you get real bonuses in a bank and nine and a half years, I shook the CEO's hand once and I certainly didn't really sort of get vision of how a client goes end to end through a business. So I think absolutely not, I think ... And being closer to the client is a real draw card and especially if the talent that you're looking for, the things we look for for these independent ...
I'm going to start throwing this stuff out there 'cause it's kind of our secret sauce. But I like it is ones that have worked in family business, ones that have always had job, ones that come from the bush, have played sport, have always been busy, those are kind of the people that you want in a independent firm compared to a large organisation. The really, really smart kids that haven't done all of that sort of stuff, wonderful opportunities for large organisations that have structured HR plans and people managing them and sitting over the top of them and saying, "This is how you do things," every day, every minute, and go ... Independent firms need some a bit more sort of, I don't know, flat thinking, but independent thinking and that comes out of those things that I've mentioned.
MH: Okay, we're going to sort of come to the end of our time relatively soon, but you're not getting off that easily. So Grad Mentor is going great guns and you place a lot of fantastic people into some fantastic businesses.
MH: I think you've always wanted to wear a T-shirt and jeans. So you decided to set up a start up.
AB: Yeah. And so today, I'm in a suit again, funnily enough. So yeah, so we went to digitise it, we just ... There's some things that we've learnt, some wonderful clients and some wonderful students that we've worked with and we wanted to be able to scale that and provide a bit more service and disrupt a few things, that sort of ... I don't mean to drop key words in there, but just it can be done better, right. And my mantra is always been make this as seamless as possible for the client and the student.
MH: And this is matching the grad from university to the practise?
AB: Yeah. And there's certain things that we're not going to take away. Like there's still a lot of elements in there that are sort of hands on and making sure that the quality is really good. But yeah, allowing a business to set up a profile to understand their cultural DNA that actually is the attractive elements for young people or talent into their businesses, for them to be able to put a job description together that actually stands out and makes sense and then to be able to then match them through the algorithm of what we've done before for this great talent. Finding these homes and allowing them to shortlist and make it quick and easy and simple for them to engage with each other.
MH: So is this the Tinder for financial services?
AB: No, because Tinder's like I've heard-
MH: It's a short term-
AB: I've heard-
MH: Short term proposition apparently.
AB: Tinder is you're around, you'll do, right, and that's kind of the olden day. It's a bit more, I don't know, it's one of these other ones where you're like-
AB: You're like cats and you're walking along the beach, right? So there's a bit more matching to it and a bit ... And because our experience in the last six years with Grad Mentor is that if you can do everything you possibly can or getting about the right person first up and then, you start doing all these other elements, then you're going to get a better retention and a better return on your investment. And as a small business owner, as I sit back at the beginning, my heart and my anxiety pumps when I think about the mistakes that you can make around people and so forth. So we need to take that pain away from small businesses so they can grow without that pain and focus on the right outcome. So if we know that we can get the match better on earlier because they're more highly aligned and so therefore, running any algorithm through that, still there's going to be an in meeting and greeting. It's not like you're just ... You're not ordering them off the computer. We're creating that speed networking environment in a forum that's more digestible for more people.
MH: So the business is called Striver.
MH: Make sure you jump online and have a look.
MH: And just the last question before you go, how big a jump was it to go from Grad Mentor to Striver? And have you taken your existing team? Has it been harder, taken longer than you expected? And what are some of the other words of wisdom that you can share for anyone considering a new tech venture?
AB: So, yes, I've taken my team. You always need more money. That's kind of one of my tips. You're always running out of money, but that's ... And because you always want to make sure that you're building the best possible thing-
MH: Do you have external shareholders?
AB: Yeah, I do, yeah, yeah. So it was a combination of self-funding and external shareholders. The thing that I learned, the thing that was most valuable was we had ... Oh, I can't remember what it was called now. Feedback Tuesday, something Tuesday, Feedback Tuesday, but it was we did two clients' feedback sessions on Tuesday morning, two university feedback sessions in mid day, and two student feedback sessions in the afternoon for the first eight weeks of our company design sprint so ... and they were all new. So every time we would take something, we'd give it to them, we'd test it, we'd get them on [inaudible] and we just feedback, feedback, feedback, feedback.
We didn't want to drink our own Kool-Aid so you end up ... people tell you that they don't want what you think, but they wouldn't ... That's kind of it breaks your heart a little bit but you go, "Well, it should save me a lot of time, effort and energy and money there." So the client feedback, it's so obvious, but I just made it part of, as a product owner and a tech firm, which is kind of not where I've ever thought I would be is just right. If we're not getting our client feedback or user testing, we're ... Testing Tuesday, that's what we call them.
MH: And was that across everything?
MH: So service delivery, product design, app design.
AB: Everything, everything. We still do it now. And so we launched four weeks ago and we've got 444 students or something like that, had been through the platform as of this morning when the last looked and that doesn't stop. And every time we go into a new build, every Tuesday, we just do Testing Tuesday and it's great. But the good thing now that we've got a product that's live though is you can watch what people do. It's not so much running feedback groups. It's running tests and experiments.
MH: So the success of a lot of these social networks if you like, is the network free for students? What's the commercial model?
AB: Yeah, so free for students at the moment. We haven't thought about what we'd do there. And for businesses, there's a subscription model. So we've dropped the overall cost to a business, which I think you should do when you start building efficient technology. So there's a subscription model. So our first bunch of clients, we bought in at a lower subscription cost and our placement fees have dropped and our subscription fees is lower than what our engagement fee was before. So we've dropped everything, subscription fee, and then now, our role and responsibility for the next 12 months is getting as much value back to those businesses as possible.
So we've done some arrangement with some certain groups where we've got some good sharp pricing on it, but basically, we just want people to come and play with it and engage with it. And that's we've set up a profile, loads of jobs, explore students, consume our content, give us feedback, tell us how it works.
MH: Fantastic. Thank you for your time and congratulations on launching Striver.
AB: Thanks, mate.
MH: I know it's been a long time in the making.
MH: I hope it goes well. I'm sure it will. And look forward to catching up again soon.
AB: Good on you. Thanks, Matt.