A Referral Opportunity Advisors Rarely Recognize

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I don’t know how I missed this referral opportunity for so long.

An undiscovered center-of-influence

A lot of very informative articles have been written about the importance of fostering relationships with centers-of-influence (COIs). No one could dispute the premise: having a steady stream of referrals from pre-existing relationships is critical to the success of your business.

Most advisors consider attorneys and CPAs as primary COIs, and with good reason. The more affluent the client, the more likely they are to rely on attorneys and accountants as a source of referrals. According to Theresa Riccobuono, 68.9% of affluent clients find their primary financial advisor in this way. The percentage increases to 89% for those with $10 million or more in assets.

It’s not surprising that advisors spend so much time, effort and money pursuing relationships with these professionals.

Here’s another COI that has been largely overlooked: investment bankers handling transactions in the middle market (often defined as companies with revenues between $5 million and $250 million).

Think about it. These bankers are the focal point for transactions that inevitably lead to a significant, once-in-a-lifetime, liquidity event. Who will end up managing those assets?