< Check other case studiesHow advice giant Fairstone uses Unbiased to reach customers who are new to financial advice
Nationwide financial planning outfit, Fairstone, talks to Unbiased about how the advice market is evolving, and why Unbiased’s matching service is crucial for helping clients make the right decisions with their wealth
• Fairstone is a full-service wealth management house redefining the UK financial planning market.
• It incorporates one of the UK's largest Chartered financial planning firms, with over 400 advisers managing £13bn in client assets.
• It offers independent, whole-of-market choice and its managed investment portfolios have been Defaqto 5-star rated for seven consecutive years.
Published on 29.07.2022
Fairstone has plenty of reasons to be optimistic. In early 2022, the firm hit two key milestones. Firstly, it secured the acquisition of its 50th advice firm, and secondly, its annual revenues surpassed the £100m mark.
Gavin Green, Fairstone’s Head of Business Solutions, joined the company in its early days. He says Unbiased’s matching service continues to be a key part of the Fairstone business model, helping thousands more people make their financial goals a reality. In a relationship that has spanned half a decade, Green explains Unbiased’s technology is fundamental in supporting the needs of consumers who are seeking advice for the first time.
“Unbiased’s market-leading service is a fantastic way of connecting new clients - those engaging with advice for the first time - with our professional advisers.”
As Green notes, the importance of Unbiased’s matching service is underscored by the difficulties consumers face in finding the right financial expert for their individual circumstances. For the layperson, differentiating between a wealth manager, an IFA and a financial coach is far from easy.
“The terminology surrounding financial advice can be confusing and off-putting. First-time users of financial services are more likely to use a trusted, matching service to find an adviser rather than undertake that research themselves.”
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Gavin Green, Fairstone’s Head of Business Solutions
Helping firms realise growth aspirations
Increasing regulatory demands are hitting smaller advice firms the hardest, with advisers finding themselves spending more time in the back office and less time with their clients. Many of these firms have an appetite for growth but lack the resources they need to commit to their goals.
Fairstone offers a tailor-made solution. Its unique DBO acquisition model offers a partnership not a purchase. The model relieves firms of regulatory and administrative pressures, offering centralised functions in areas such as compliance, paraplanning, human resources and recruitment. And unlike consolidators, Fairstone encourages acquired firms to retain advisers, staff and their client investment solutions.
“By taking the heavy-lifting away from advisers, we can free up 30% - 40% of their week to spend time with clients,” Green says.
He stresses that this is far from a numbers game. When eyeing up potential acquisitions, the focus is on quality rather than quantity. What happens after the purchase is more important than the purchase itself.
“We’re not looking for businesses in distress. We’re looking for those who wish to partner with us to grow their business. We seek up and coming businesses, and do that by identifying firms in the market that we think will work culturally with us, and share our aspirations for growth and putting their clients first.”
How Covid accelerated tech adoption
Finding positives from the coronavirus pandemic is no easy task - our personal and professional lives have been deeply affected. But one of the few bright spots has been the wider adoption of technology, which is now helping both the profession and Fairstone deliver advice more efficiently to more people.
The profession has long prided itself on its personal touch, but with face-to-face meetings prohibited for long stretches during the past two years due to social distancing restrictions, virtual meetings proved a worthy substitute. Video technology such as Zoom and Teams enabled clients to stay connected to their advisers, and Green says consumers across all demographics are now more open to engaging digitally.
“For existing clients, we’re seeing more and more wanting to conduct interviews virtually,” he says. “The majority of the first appointments we book are through Teams, then we book face-to-face meetings down the line.”
Green adds this shift has enabled Fairstone to become leaner. By conducting more client meetings virtually, advisers can spend more time seeing existing clients and attracting new ones. And this is making inroads into one of the sector’s biggest ongoing challenges: the advice gap.
Removing the barriers to advice for younger savers
According to Green, the Great Wealth Transfer should prove a notable tailwind for advisers, with trillions of pounds set to pass between generations over the coming decades. “This presents a big opportunity to engage and educate younger generations around simple financial aspects,” he says.
In recognition of this, Fairstone has launched several initiatives to help improve the financial literacy of those due to inherit this wealth. These include a junior finance academy, with a gamified nature to make it fun and engaging, and also a hybrid advice service, which seeks to make advice accessible for younger people at the start of their careers. “We want to help the early accumulator start their financial journey,” Green says.
Since the retail distribution came into force in 2013, advice has largely been reserved for the affluent. This is driving many younger investors to DIY platforms. But although people taking their first steps on the savings ladder is indeed encouraging, Green says advice in this area is imperative to ensure their investment strategies are appropriate in terms of attitude to risk and capacity to bear losses.
“Our hybrid service sits between full advice and DIY, combining slick, efficient technology with the security and comfort of knowing a human adviser is involved in the process to check risk and suitability.”
A further initiative has its sights set firmly on the future - Fairstone runs a seminar programme for young medical professionals.
Green says: “We visit 33 medical schools and talk to them about education, budgeting, and planning as we recognise that they will eventually become affluent and need advice further down the line.”
Fairstone is committed to providing barrier-free access to advice at the best possible value. Unbiased opens up this service to a whole new audience, which complements and supports its efforts across the wider marketplace.
