What Challenges Do Firm Owners Face in Years 3-7? What Would Arlene Say?

13 min read
August 08, 2019

Typically, I break the transitional phases of business ownership into three different segments:

  1. Years 1-3: Start-Up and Launch
  2. Years 3-7: Growing and Big-Picture Planning
  3. Years 7+: Continued Business Evolution

When XY Planning Network launched, many of its members were in the Year 1-3 phase of their financial planning practice. This created a pretty cool group dynamic.

Many members were all going through the exact same challenges. They were able to band together and help one another through the start-up and launch chapter of their businesses and address shared roadblocks.

Now, however, a much larger chunk of those same members (and XYPN's new members!) are in either the Years 3-7 phase or the Years 7+ phase of their businesses.

It’s still helpful to connect with fellow members of XY Planning Network during these phases of your business, but the truth is that the “shared experiences” factor gets a little bit less cut and dry.

This can make it tough for a lot of financial planners because they go from having an extensive network that’s going through exactly what they’re going through, to having more individualized roadblocks and challenges to continue growing their unique practice.

While there are still members out there who share your experience, it’s not as universal as commiserating about waiting for approvals to launch or hustling to gain your first few clients.

For many advisors, this can feel really isolating. Poking around the web, it seems like there are far fewer resources out there for advisors in the 3-7 Year phase of their business.

Today, I want to break down that barrier for my Years 3-7 folks. In my opinion, this can be the toughest phase of your business.

You’ve powered through the busy work that is being in start-up mode, and now you’re trying to figure out a way to build a sustainable, fulfilling practice for the long-term—and it’s not easy.

Let’s take a look at the different challenges you’re going to face in Years 3-7 and how to move past them towards continued success in your work and your life for years to come.

Start-Up Mode is Over—Take a Breath and Re-evaluate

The start-up mode of any practice is exhausting. You’re hustling. You’re working long hours for (possibly) very little pay. You’ve launched a website and a marketing strategy, figured out your niche, honed your closing skills, built a network of colleagues, and have started to hit your stride when it comes to slow and steady client growth.

Now, you get to take a bit of a breather. You’ve worked hard —pat yourself on the back! It’s time for “hustle mode” to give way to more strategic growth and planning, and that’s a bit of a calmer, more intentional mindset to adopt as a business owner.

In this phase of your business, it’s time to decide what’s next. To me, that means:

  • Having strategic planning time baked into your schedule semi-regularly
  • Big picture thinking now that you’re out of the drudgery of start-up mode
  • Retreats and advanced planning conferences to start leveling up your skillset and business growth goals

Exiting start-up mode doesn’t necessarily mean you stop working toward growth—it’s just less of a mad dash toward signing clients and getting “to do’s” checked off the list. You want to make sure that you’re building a practice that fulfills you (and your team, if applicable) in the long run, not just growing for growth’s sake.

The good news is that there are a lot of resources available during this phase of your practice. If you’re unsure about what’s next for you, or how to continue growing in an intentional way, make sure you think about:

  • Hiring a coach. A coach is valuable at any point in your firm’s growth, but I feel like our skillset is especially useful right now in years 3-7. You want to have a third party coach you through concepts like scaling successfully, training a team, setting goals, knowing what revenue goals will drive success, and more. One-on-one support and training here can be a game-changer.
  • Attending XYPN PAUSE.This mini-conference for XYPN members is specifically designed for folks in years 3-7. It’s a great fit if you need to hit “pause” in your practice to set some more intentional goals for yourself and your team.
  • Attending FPA Retreat. Getting growth ideas, and keeping up with what’s going on in the profession, are just two of the benefits of FPA Retreat. You also get to network with a lot of other advisors who are in your same shoes, which is a fantastic way to ask questions and learn from one another.
  • Coordinating team retreats and strategic planning retreats. Now is a great time to coordinate a team retreat to get everyone on the same page and grow closer together. Still a solopreneur? That’s okay, too! I still recommend a solo strategic planning retreat to align your goals with your values and rethinking what’s working (and what’s not) now that you’re coming up for air after exiting start-up mode. Please remember - a retreat isn’t an afternoon in the conference room! It’s a dedicated day or more away from your daily activities and distractions to really dig deep and get some planning work done for your business.
  • Getting support from your network. Your XYPN network is still a fantastic resource, you just might have to look a little harder to find firm owners who are growing in the same ways you are. There are hundreds of ways to successfully grow a practice. You want to find fellow advisors who share your similar growth and lifestyle goals and connect with them. Think about forming an accountability partnership with one or two other advisors who are walking the same path.

Revisit Your “Why” and Revise

When you launched several years ago, you were bright-eyed, bushy-tailed, and totally rooted in your “why” as you grew your practice. But here’s the thing—you’re human. Your goals, dreams, and your “why” as a business owner are all going to evolve and change, and that’s totally okay!

What’s important is to remember to check in with yourself periodically to make sure you’re still growing in a way that lines up with your ever-evolving mission. There are so many ways your vision for your firm may have evolved in the past several years, but I want to tackle a few of the most common that I see from advisors who are 3-7 years in.

Firm Size

Do you want to grow a bigger practice than you had imagined? Maybe you want to pare down and keep things smaller, and more like a successful lifestyle practice. When you first launch, you’re in survival mode. Growth for growth’s sake feels right because it’s the only way you’re going to pay the bills.

Now that you’ve grown for the past few years, you might be surprised to find that you’re not thrilled with what you once thought of as “comfortable.” Once you’re out of survival mode in the start-up phase, you might be getting excited about growing more, or dreaming bigger dreams for your firm. Be gentle with yourself here. You’re allowed to scale up or down as you go, it’s all about what’s going to bring you fulfillment and allow you to serve clients in a way that’s impactful.

How You Want to Make An Impact

When you’re in start-up mode, just growing your practice feels like making a big enough impact. All of your hours are sucked up by marketing, doing start-up busy work (that’s unfortunate but necessary), prospecting, and working with clients.

Now that you’re in the, “Phew, I guess this is going to really work,” part of your journey, you get to relax and “re-dream” a little bit. How do you want to impact the world around you? How do you want to leave your mark on the financial planning profession? Is there a way that you want your community or family to be positively impacted by your work?

When you were in the start-up phase of your business, you may have felt totally swamped and overwhelmed. Now, you get to step back and consider other ways you want to grow as a person and a planner. Do you want to volunteer within a network you belong to? Mentor new planners? Start a residency or internship program within your practice?

Maybe you want to refocus on how your business can make an impact elsewhere in your life. Do you want to grow your team and empower them as planners and people? Do you want to reduce the number of hours you’re working to spend more time with your kids before they grow up and leave the nest? The possibilities are endless, and the way you want to make an impact is 100% up to you.

Who You Want to Serve

Maybe you’ve been targeting a specific niche, but now you’re realizing that you have a sub-niche you want to focus on. Maybe you want to pivot completely because you’re realizing you’re more passionate about serving one specific group of people. It’s okay to pivot, although it can be a challenging “next step” as you grow your business intentionally. Remember that you don’t have to be all-or-nothing.

You can make your pivot slowly in a way that matches your growth goals, and still serve your current clients. Shameless plug: this is where working with a coach can be really handy!

The Type of Planning You Want to Do

I find a lot of advisors who are in the year 3-7 phase of their practice start to rethink the type of planning they want to do. Often, this comes from realizing what type of planning is actually going to work for their lifestyle and their ideal client base. Maybe you’ve been focusing on one-time project planning, but you realize that your Gen X clients need more ongoing help. Maybe it’s just the opposite - you thought that ongoing retainer work made the most sense, but you’re finding that your niche is self-motivated to DIY and carry out the plan you build them.

You’re allowed to adjust your service offerings as needed! Don’t be afraid to evaluate what’s working, what’s profitable, and what you enjoy doing during this phase of your business.

Growing Intentionally

When you’re growing as a start-up, you’re usually not growing intentionally. I’m not knocking the growth you’ve had in the last 3-7 years. You did what was necessary to stay moving! But now it’s time to take a step back and stop drifting with the growth that’s happening to you and take charge. You don’t want to grow with whatever happens to grow, that’s a recipe for disappointment and disaster. If you allow your business to run you, you’ll end up feeling unfulfilled and out of control several years down the line. Heck, you might be feeling that right now.

Years 3-7 are a great time to start thinking intentionally about your growth. Have you grown away from what you wanted, or where you’re meant to be? If that’s the case, it might be time to redirect. Taking the time to define your growth goals and invest some hours in developing an ideal client profile can help you to get clear on how quickly you want to grow, and who you want to sign on. This will also help to guide hiring and internal growth decisions.

Maybe you’re completely happy with how you’ve been growing, or who you’re working with, but you know you need to build a strategy to make your practice sustainable and keep up this pace. That might mean you look at hiring, signing on a partner, or outsourcing work you don’t love in order to keep working with the type of clients you enjoy.

Growing intentionally is about knowing your “why”, but also putting a strategic plan in place to support your mission and the vision you have for your practice. To do this, think about tackling:

  • How quickly you want to scale
  • How to build a sales funnel that draws in your ideal prospects
  • What hiring decisions need to be made to support those growth goals
  • What tasks aren’t an efficient use of your time - and how you can afford to outsource them
  • How to set revenue goals that reflect the life and business you want to run
  • What timeline you want to execute some of these goals in

These pieces of the puzzle will help you to start growing more intentionally, not just growing for growth’s sake.

Improving Your Business

Years 3-7 are a fantastic time to focus on business improvement! Now that you’re hitting your stride in the growth department, you’re able to stretch yourself to improve and grow as a business owner. There are several different areas of your business you can tackle and improve—these are just a few examples!

Financial Planning Skills

If you had a few extra hours a week, what do you want to learn?

As a financial planner and a business owner, there are so many different business skills you can focus on honing. You can zero in on actual financial planning skills by gaining new certifications or taking focused continued education. You can also think about what type of continuing education your clients would benefit from.

Do you work primarily with retirees? Consider earning a retirement-focused CE credit. You could also look at the RICP® designation if that’s interesting to you! Do you work with Gen X parents? Start looking at ways to incorporate pre-retirement or college planning (for their kids!) into your education routine. Fascinated by financial life planning? Check out George Kinder’s Life Planning training!

Business Skills

You don’t have to only focus on financial planning related skills. In fact, as a business owner, it’s healthy to branch out and learn more about business ownership! Think about what special interests you have, or the weak spots you’re experiencing in your business.

Are you interested in scaling a team? Think about leadership training! Thinking about leveling up your marketing? Take an online course from a blogger or influencer you love outside of the industry, head to a local class at a college near you, or reach out to our very own marketing coach here at XYPN!

Audit Your Tech Stack

One of the best ways to continually level up as a business owner is to periodically audit your tech stack. Blocking off time annually, or every few years, to audit your tech helps you to see your technology in new ways and helps you to focus on getting the most out of what you have.

It’s also important to set aside time to check out new tech on the market. Tools for business owners and financial planners evolve so quickly, so it’s good to check in and see if new tools out there will better fit your needs. Remember, balance whether you’re spending too much “fun time” looking at new toys with actually finding real solutions for pain points you’re experiencing. You don’t want to fall behind the times, but you also don’t want to be constantly onboarding new, shiny tech that’s time consuming and shows inconsistency to your clients.

Run a Mock Audit

If you’ve never had a mock audit done - now is the time! This is a fantastic check-in to make sure you’re on the ball with compliance and can be an awesome project as you head to the next phase of business ownership.

Succession Planning

Do you have a succession plan in place? I don’t care if you’re thinking about retiring in 1 year or 20, you need a succession and contingency plan ASAP. This might look like joining forces with a partner to better serve your clients, start building out a succession plan for your clients after you retire in the form of a rock star team, or start conversations with colleagues who you know and trust about being part of a succession or contingency plan for you. These conversations often take time, and it’s important to start them now while you still have plenty of time before retirement.

Questions to Answer in Years 3-7

We’ve covered a lot of challenges you face as a financial planning practice owner in years 3-7 of your business. But we’ve also barely scratched the surface of the different questions you can ask yourself right now to keep leveling up and growing in an intentional way!

If you’re feeling ready to dig in and do the work to keep growing in a new and exciting way in this phase of your business owner journey, think about asking yourself these questions:

Do I need to hire personnel?

Whether you want to hire people part or full time, or you just want to start outsourcing work to contractors, this is a great “next step” to think about in this chapter of your life as a business owner. Personnel can mean you’re hiring for full jobs, parts of your planning process, back office work, marketing—you name it. Think about what skill sets would complement yours and become a culture add for your business.

Do I need more advanced sales funnels?

How does your sales process look? Do you have a leaky funnel? If you’re wanting to level up your marketing and sales, you’ll want to do a stress-test of your sales funnel to figure out where inefficiencies are. This might mean you focus on better segmenting prospective clients into multiple, more specific niches. It might mean you start automating elements of your funnel to free up time for you and your staff. Be open to new ideas!

Does my service offering need to be refined?

Who are your favorite people to work with? Is there a way you can further refine your service offering to better address their pain points and ultimately sign on more of those ideal clients?

Am I fulfilled in my professional life?

If you’re not feeling fulfilled in your work life, it might be time to expand your horizons. This could be pro bono work, industry involvement, volunteer work, or any number of things that reconnect you to your “why” and your love for the financial planning profession.

Have Questions?

This is an exciting chapter of your life as a firm owner, but it can also be scary! The good news is that you don’t have to feel stuck. You get to evolve as a business owner, and as a financial planner, and that’s a fantastic feeling to embrace.

If you have questions or need help, get in touch with me! I’d love to chat with you about all the challenges you’re facing and how to focus on intentional growth both now and in the years to come.


About Arlene Moss, Executive Coach

Arlene gets a kick out of helping financial advisors get over being overwhelmed and take on their frustrations so their businesses soar. Arlene works to ensure XYPN members are able to help their clients prosper while creating a sustainable business model. Through XYPN Academy and one-on-one coaching, members get the support they need to grow their businesses and overcome the challenges that come their way.

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