#17: Recruiting and Hiring Top Talent

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How To Find, Train, And Retain The Best Employees

A good business model starts by effectively positioning yourself to serve your clients in the best way possible. But in order to deliver that 5-star service, you need talented, dedicated employees. 

One challenge any growing financial business faces is recruiting and hiring the right people. Everyone makes mistakes in the hiring process, but there are some tried and true points to help you make the best choice for your firm, and most importantly, your customers. 

Let’s dive into the world of hiring!

Finding The Right Time To Hire

The first thing that you need to understand is your business model and projected growth. What is going on in your business? Why do you need another role? What service role will be best for the direction you are moving in? The one word that comes to mind in the hiring process is anticipate

Make hiring a strategic decision, not one that you make on the fly or when you feel yourself drowning. This is often where mistakes are made: when the process has to be rushed or fast-tracked in order to fill an immediate business need. It really comes down to anticipating that business need and making a plan for the recruiting and training process in conjunction with the market and your firm’s households.

When you are looking at adding to your team, you want to ensure you are mitigating the costs. So you don’t want to hire extra people and take a payroll hit that isn’t necessary. You want to delay this hard cost as long as possible, but what businesses really need to understand is the hidden cost or the collateral impacts of not making the hire. 

By delaying hiring in an open position, what costs will impact your current organization? What added pressure does it put on current employees? What is the impact or strain it will have on your service and your client experience? 

Remember, your client experience needs to be your top priority. Think through some additional questions:

  • Are you able to deliver your service experience with your current staff?
  • Is your service model sustainable and scalable?
  • How many households can your current staff handle without causing a drop in quality? Are you close to hitting capacity? 

So deciding when to hire depends on how quickly your staff will hit capacity and how quickly your firm is growing. Let’s take a look at an example with a paraplanner role. 

In this example, we assume that a paraplanner can handle a hundred households and it takes 12 months to be 100% effective (complete training, working autonomously, successfully completing their duties). In this scenario, after four months of training, they will be 40% effective. In a business with about 350 households, there are four paraplanners with 88 households each, so they run at about 88% capacity. 

If the firm is adding households, it might be time to hire. You need to know how quickly households are coming on board. For example, assume that this business will average five new households per month. In four months, there will be 370 households and the staff will be at about 93% capacity – closing in on that 100% capacity which we want to avoid. Having employees operate at 100% capacity leaves no room for sickness, vacations, and other absences. It also could lead to a higher rate of burnout. 

So if we add a new paraplanner right now, in four months, they might be able to handle say 40 households. We expect the firm to go from 350 to 370 households at that time. So the new paraplanner might be able to be assigned the 20 new households. This increases their capacity for new households and allows them to grow into the new role. 

Remember, training isn’t 0 to 100 in 60 seconds. It takes time and patience to get right. You want to move at a steady yet manageable progression to ensure they are providing the service you expect. 

When Should Your Firm Add New Roles?

The first section discussed how you hire additional roles that already exist in your business matrix, but what about hiring for roles that don’t yet exist? In accounting, they call this a step cost, when you go from zero to one. 

This step cost could be huge depending on the role you create. For example, you could go from zero to $100,000 for a full-time chief compliance officer. This is probably one of the most difficult hires to make because of that steep increase in hard costs. 

Step costs tend to impact growing firms the hardest because these are the ones who need top talent to keep growing but have to spend a lot of money to get there. Dan Sievert of Echelon Partners describes this as the valley of doom. Reminiscent of a classic horror film, the valley of doom tends to happen when firms grow from around 500 million dollars in assets to about a billion dollars in assets. 

There are a number of step costs that a firm incurs during this period of growth. This could mean that expenses grow faster than revenue and firms tend to see their margins contract. This can be highly discouraging for firm owners because they have a business that’s growing, but they are making less money. 

As a firm grows, there are a number of other positions that may need to be added to the organization chart as well as professional compliance support. In many of these cases, a firm is going from no one to fill a full-time person. 

For example, HR management, including recruiting, the hiring, the onboarding, managing compensation, is one example. Another would be a financial controller, a CFO to stay on top of the firm’s internal finances, the budgets, the forecasting, managing, billing, and partner distributions. Let’s take a look at other new positions and teams that a firm of this size could expect.

Typical New Roles For A Growing Firm

There are a number of other roles and even teams that will need to be developed as firms grow and surpass a billion dollars of client assets. A few are listed below. 

Talent Development

  • A critical role is to make sure that the people you’ve just brought on board have a structured training development process. It’s really, really important to their development, but also to the retention. 


  • Some firms leave all the marketing in the hands of advisors and business development people. But someone needs to provide assistance to manage the website, develop consistent branding, etc. Ultimately, there needs to be someone in charge of maintaining the brand to attract new clients and recruit staff.

Operational Leadership

  • Operational leadership is another area that often gets built at this point in the company’s development. By this, I mean an executive doesn’t perform any operational tasks. But rather, provides leadership and direction to the people who do.

Corporate Development

  • Attracting advisors to merge with or sell their business to an IRA. A robust corporate development team can really help a firm pass through the valley of doom more quickly than they might if they only relied on organic growth.

How To Recruit Talented People

Finding a good fit for your firm can be difficult, but there are ample opportunities to find the right talent if you know where to look. We are going to look at the top three sources for quality leads. 

  1. Employee referrals
  2. Campus visits/career fairs
  3. LinkedIn

Let’s take a look at each of these in a bit more detail. In our opinion, there is almost no better resource for finding new talent than from the people that actually work for you. Encourage your employees to talk about the company. Leverage technology and social media. Getting your employees to share hiring information can be a great way to get the word out. 

Good people tend to know other people who may be able to fit into the company culture and have the right work ethic. These referrals are free and tend to convert well into new hires.

Campus visits and career fairs are other great places to attract new talent. In fact, one of our Credent Wealth partners pays an annual visit to a local college campus for a career day in the financial planning department.

This gives the company exposure to students and professionals and also provides a space to get to know some of the students on a more personal level. Those personal connections are crucial to the financial industry. 

Last but not least, we are going to talk about what a great tool LinkedIn is for finding potential hires. This is a great medium to find talented professionals, especially those who are established in their careers. It is a great space for professional networking and expanding your contacts. You might be surprised to see the number of people you could be connected to and where that connection could lead. It also provides a large platform to communicate with your audience. 

Attracting The Right People For Your Firm

Recruiting is an important part of your firm. As you grow, you will need talented people to help carry that vision and deliver optimum service to clients. You want to find people who fit within your organization. What does this mean? It could be someone with similar interests and values. It is someone with the proper training, relevant skills and experience, work ethic, and more. 

Once you find the right people, you want to keep them. Employee retention is a huge indicator of company culture and success. The cost to recruit, hire, and train is immense, you want to be able to keep those people as long as you can. 

The hiring process is one of the most important aspects of a successful business. Are you ready to start making strategic hiring choices? Download our free worksheet below that helps you decide when to hire your next employee. 

Free Download Below!

When To Hire Worksheet

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