Improve your sales by ditching the pitch book, listening and being true to your values
Improve your sales by ditching the pitch book, listening and being true to your values
MIJ talks with Senior Wealth Manager Eric Bennett about his journey to independence, finding rules & behavioural coaching, experience-based marketing and volunteerism as a way to establish value alignment.
4:30 The service model
7:00 The pitch book
10:15 The tax man
11:15 Behaviour & scientific investing
18:00 Wealth destruction & finding factors
27:30 Simple messages
29:45 Experience marketing
41:00 Wrap up
Born and raised in Calgary, Eric made the decision to move his advisory practice to ScotiaMcLeod/Scotia Wealth Management in the spring of 2011. He brings with him more than 15 years of experience in the financial services industry, with a core focus on risk management and tax efficiency.
Eric holds a Bachelor of Applied Financial Services degree through a combined education from Mount Royal University here in Calgary and Lingnan University in Hong Kong.
In 2006, he was honored by the Hong Kong Canadian Business Association (HKCBA) with an award for excellence in international studies.
Some other notable achievements in 2019:
- Canadian Cancer Society - Prairie Leadership Award in Philanthropy
- Scotia McLeod - Share the Wealth - Second time Award Recipient
- Rotary Club of Calgary - President 2020-2021
- Harry G Schaeffer Mentorship Program – Mount Royal University - 5 Year Mentorship Award
Some current initiatives he is involved in are:
- Scotia McLeod - Share The Wealth: https://scotiamcleodcharitablefoundation.org/
- Co-Founder of Spin For Life - benefiting Canadian Cancer Society: www.spinforlife.ca
- Incoming President - Rotary Club Of Calgary: https://rotaryclubofcalgary.org/
- Harry G Schaeffer Mentorship Program, Mount Royal University: https://www.mtroyal.ca/AcademicSupport/ResourcesServices/StudentLearningServices/MentorshipProgram/index.htm
“I whole heartedly believe that volunteering is the rent you pay to occupy the space in a community. I originally thought it would be a place where I could prospect for wealthy clients, but quickly realized that surrounding myself with amazing people - all who are volunteering their time, talent and treasure to make the community (locally and globally) a better place, was an excellent way to shrink Calgary to "one degree of separation".
"Service Above Self" is the Rotary motto, and I strongly believe that if we focus on the wellbeing of others, and success of others, from all walks of life, inevitably success comes back to you in multiples. It's a win win win situation.”
With the launch of our new podcast we need your help to spread the word. We want to give you an experience of your choice to get you out of the house and forget the COVID blues (up to $250 in value).
From skiing, to wine tasting to visiting the zoo to eating at a nice restaurant the choice is yours. Entering is simple, all you have to do leave a review of your favourite part of the podcast and share this post on social using the hashtag #MIJEric. This will enter you into a random draw and we will announce the winner at the end of the season.
*For Canadian residents only.
Rod: Hello and welcome to this episode of Modern Investor Journey. My name's Rod Heard. I'm co-founder of SmartBe Wealth Inc and I'm with my partner Art Johnson. We're really excited today to have Eric Bennett with us. Eric's a senior wealth advisor at Scotia Wealth. He's an industry vet for the last 15 years.
And he's president of the Rotary Club of Calgary. Look forward to figuring out what your whole investment philosophy is all about.
Eric: Thanks for having me guys. My investment philosophy that is constantly evolving and changing.
Art: Yeah, that's a great common Eric. We named this podcast "Journey" because I think everyone has been on a journey. And I think it's very typical to make sure that investors know that investing is an iterative process, but I also think the difference between a professional investor and a kind of someone playing around with this stuff is you end up actually taking all these changes that you've had in build a philosophy.
So that's kind of what we want to delve in today. And the other thing I'm excited about today is you're a young advisor in the midst of probably one of the biggest generational changes in wealth and get some insights on what your thoughts are being an advisor in this business.
Because it's typically filled with old guys like me and we can get crotchety and set in our ways. It's lovely to have some youth on our show. I guess to start, how did you get interested in this field? What made you interested in this crazy gig?
Eric: Before I got into the business, I was actually a career chef.
So I worked in the service industry for a decade, got to the point towards the end of that where during the days I would sit down with the owners of some of the restaurants I'd be working at. And, you know, these are typically lawyers or trust fund kids or what, you know, people with money and, and we'd be sitting there in the daytime, just chatting and, you know, drinking coffee and smoking. Because everybody smoked back then too. They'd be sitting there talking on their phone to their broker or reading the stock section of the Financial Times. And so, you know, I had no idea what the heck any of that stuff was. It was just so far removed from my reality. And so we just started chatting about it and, you know, I took a more and more of an interest in it.
I always wondered I'm like, why is this just, you know, this world just for this super wealthy group of people? You know, how come that's not I think accessible to people of like, you know, every class, every economic situation? And so that got me kind of interested in that. I also realized too, that once I started talking with a few people who work in the industry that, you know, you're essentially building your own business and working for yourself.
So all of your blood, sweat, tears, and effort actually go back to your bottom line and not somebody else's. And so that was really interesting to me. And so it forced me back into school. Four years later, a degree in finance came out into the world saying well where do I want to start? You know? And so started out in retail banking. Did that for a few years.
Realized that that wasn't my life goal to be an employee again, I just want it to have that self-employed piece to it. And so came out into wealth and I interviewed about three or four you old school crotchety, stockbroker guys. And I took a bunch of guys to lunch at separate times and asked them about, you know, what got them into the industry.
What was their biggest successes, biggest failures. And if they could do it again at this time, would they do it the same way or what would they do differently. As a result of those lunches, I got job offers from three of them, which I didn't really anticipate. I just wanted to get my information to find out do I start off as a rookie or do I start off as an associate working for a senior established book? I ended up going the path of going on as a associate to a senior established book. That partnership lasted for about two years. I realized quickly that it wasn't going to evolve into some sort of true partnership.
It was more of a master and employee relationship. And so I moved on and then I found myself at another independent brokerage firm working with another team to establish a wealth management practice because that's what we had done at the previous firm. You know, in the span of a year I think I put on 22 seminars, I invite partners from tax, trust, and estate planning.
These are all things that these guys had never done before. So I built up their wealth management practice and said, okay, well instead of having 10% of a client's money, how about you look after their full financial picture? I can get and attract all of the funds and do the right things at the right times for people.
And that was a different model for these guys. And so after, under a year, I quickly realized that they never really had any intention to build a wealth practice. They just wanted more accounts to trade with.
Eric: Yeah. So I said, well you can't say you're going to do wealth and then kind of do the old switcheroo and just stick to transactional stock business.
So I quickly left that behind, put my hat in the ring. And then I said, okay, you know what? Enough working for, you know, old crotchety guys. Time for me to do this by myself. Right?
Art: So you could become an old crotchety guy?
Eric: Yeah, exactly. Why not, right? So I started out as a rookie at Scotia McLeod, just about 10 years ago.
So came over with zero assets. Because, you know, everything we did I left. You know, I didn't want any of that issue. I did bring all my marketing and all of my prospect pipeline that I'd built over the previous three years. And so I wasn't that much of a rookie. I knew what I needed to do. And I knew that at the time that this business wasn't about being the best broker, wasn't about being the best portfolio manager.
This business is asset gathering. And so I knew at that time you could have the greatest, the best model. You know, there's a few guys I know who, you know, are CFA/CA types. You know, they're so smart running the smartest portfolio models. But they had the tiniest books, you know, and it's like, wow, you guys are like rocket science smart, you know, when it comes to options, strategies and derivatives and risk management and laying out these incredibly complicated portfolios. But you don't have anyone to sell that to, and that's failure, right? That's why you struggle the whole time, but you have to realize that maybe you're in the wrong business.
Maybe as that, you should start to turn on fund and sell that back to the investor channel. But you can't say you're going to be an investment advisor, a wealth advisor, and then also try to do that other hat at the same time. So for me, I knew right along, it was all about understanding the client is it's all people driven, conversations driven.
It's not product driven. And that's how you attract assets.
Rod: That's fascinating, Eric. It's a terrific glimpse into the early part of your career. So how has your thinking about the entire practice changed over the last 10 years of being independent? As well as how you're approaching the whole asset gathering world?
Because I think you do some very innovative things and you're in the community significantly.
Eric: I brought some bad behaviour, bad habits, with me when I was working as an associate for those other more established books. One of them was the idea that you need to build a pitch book. And so I had spent, I don't know, probably like a few hundred hours, if you look at the thing, building a pitch book. And the pitch book is something that you would bring to a new prospect client meeting, sit down with them and start walking through page over page of your philosophy. The Dow of portfolio management. I had it all, you know, I had all these quotes and everything. It was awesome.
And I was so proud of it. It was double page glossy. It was awesome. I spent so much work and I was talking to a CFO of a oil company. This is my first year as a rookie here at Scotia. And then I finally got down in front of them, and I was pitching, I was going through the book and the charts and everything. And he actually nodded off to sleep in front of me.
And it was funny. I saw him do it just kind of nod straight off. I kept pitching! I kept talking. I kept going through. Because I loved what I had built so much and I would like move charts around and whatever, you know.
Rod: That's classic.
Eric: Then he woke up kinda, and snorted and put his hand on top of the book and he pushes it away and he goes, yeah I don't want any of that.
He goes, you know, the reason why I took the call is because I have a lot of my company public stock and I want to buy more of it. So I'm going to give you a bunch of it. And then you're going to use that as collateral to margin and give me more and buy more of my company stock. And I said, oh! I was already an hour and twenty into the meeting and going like, that was the valuable lesson.
After that, I'm like, no pitch book. Like, how can you start pitching before you even actually ask someone why you're there? Why you're speaking with them in the first place? What do they need? Right? So I left the pitch book world behind, which is what I was trained at earlier. You have to have a good pitch.
Always be closing, you know. But just bring in a red notebook. That was it. And so I went every single meeting after that was just this. That's it. I have nothing else on me. I had no other sales material. And I'd just sit down and just open page, ask them about them. And listen. Like what a concept. How are things going?
What are your biggest fears right now? Are you working with someone like me? You know, how's that worked out for you? They'll tell you everything that they're looking for. And then you take that information away and you promise, okay, I'm going to use all my resources and I'm going to come back with some ideas.
And we're going to work those ideas into what you might be looking for, you know. Like what a concept, you know? And so when I flipped the script and started doing that, people started signing up, you know. And I found like I was closing probably most all of the conversations I was having. That was a big aha moment for me was you can't product pitch.
You know you've got to find out what someone needs and then you can come back with the solution. And what I love about that is sometimes you might see things read between the line that they don't know that they have a exposure to or a weakness to. And that's where you can bring back the solution and then bring a couple other ideas. And they look at you completely different.
They go, I wasn't even considering that. I believe it's not what you make. It's what you keep that counts. Especially nowadays, too, if you look at the trends of taxation ever increasing, and I bet you after this COVID crisis is managed we're going to be paying for that for a very long time, which means I think an ever increasing taxation model from governments around the world. So I think that having a focus on tax efficiency and effectiveness is going to be paramount to success going forward. In my conversations with people, I find that, you know, the rational process, you know, here's portfolio management. Like here's the risks that you're taking on.
Here's the standard deviations in your portfolio. Your correlations in your portfolio. What you're paying for, it makes sense, right? And people nod their head but you're dealing with them up in their heads. But you're not dealing with them from an emotional standpoint. So I've found like you could put so much common sense up here and they're going like, wow, what I'm doing is totally wrong.
I should be doing that. And then when you go to sign the paper to bring them on they're nowhere. Cause they haven't had that emotional decision response. And so I find that when you speak to things like, okay, how much did you pay last year in taxes to CRA? You know, you could see people their shoulders go up, and their head goes down, and they get visibly angry in front of you.
You know, it's an emotional response. And if you get that emotional response then you can say, well, how about I alleviate that pressure for you? You can keep doing the exact same thing you're doing, but let's talk about making sure that you're not sending a dime more than you should. Or that you have been doing for the last 15 years.
So that's a bit into my story and philosophy a little bit.
Art: I think you've hit on something there. And it's something we talk over and over about in this podcast. Our insight's worth or not worth something. And using an analogy is if I wanted to lose weight, if I didn't know that I needed to cut down on calories and exercise more, that'd be a tremendously valuable insight.
But people know that now. And it's kind of meaningless. When people are successful with a lot of things it's because they start to build not just an insight, but actually an emotional connection to the thing itself. And they get an endowed effect theirselves and they actually start to understand it in a way that is not just, you know, the typical insights. On the other side of emotion what have you learned about investors?
Eric: Thanks to guys like Ken, who I met early on in the industry, Ken McNeil. He's the one that kind of introduced me to behavioural biases that we all have when it comes to investing. And he introduced me to Schiller's books. Animal Spirits, which was a book that I started to give out to all my clients because it was actually a really good read and it did a great job of explaining all of our biases. And explaining that, okay, retail investors, you know, the DIY guy at home, professional money managers, institutional guys, pension men, everybody is the same when it comes to behavioural bias. If anyone's out there saying that they're different, that they're going to be, you know, selling high and they're going to be the ones to buy low, like that is like a strange defect in human behaviour to be able to actually do that successfully all the time. Just because it goes against our internal, like who we are and how we respond to things. So what I try to put in place when it comes to the investment management side of the business, or when I'm talking to clients about how we put things together, you know, I want to put as many things in between us and that big red button, which is the button that makes us do the wrong thing at the wrong time, pull the parachute, sell out a market bottom, do whatever, because, you know, we're all bombarded with all of the same information. When the world is falling like, for example, the financial crisis in 2009, we are all getting that same information. We didn't know what the recovery is gonna look like. All we saw was two major banks fail, and we had no idea how we were going to get out of that. You know, I saw crotchety old senior advisors under their desks. That's why guys stopped coming into work. And I'm going like, wow, you guys are 30 years in the business and you don't even know?
I'm like, nobody knows when we're in these environments. In hindsight, we look back and we could be, like, well obviously I put all my money and stocks in the bottom of 2000. I'm like, no, you didn't. You wouldn't. We didn't have a clear path ahead for another year and a half, you know? And even then it didn't feel great.
So when it comes to building the portfolios, management, you know, I always try to look for those things that are kind of separate the human emotional response from us having to make a decision at that time. So having things like an auto computer, unemotional unbiased trigger like an auto rebalance is amazing.
Eric: It's rules-based and it's one of the only, I think, free lunches, you know, in this business, if you could just have something that is basic, is that set up, you're going to do so much better than a lot of people who are kind of winging it and you, know, at the mercy of their emotions.
Rod: It makes good sense, Eric.
It's fascinating that, you know, you've landed on this whole rules-based philosophy. Notwithstanding your friendship with Art, and Art being at Scotia, and you're looking at this crazy guy who is an early innovator in all of this academic quantitative investing. How did you start to get interested in learning more about the science of investing in finance and extend beyond an auto rebalance to start to investigate some of the academic world.
Eric: It's a natural extension when you start to look at rules-based. Look at a behaviour management and putting things in place that remove the human from a lot of those decision making moments. And so for me, I came from that into multi-asset multi-managed type of portfolios. Very pension style, investment management for clients.
And honestly that that's what led to a lot of deep and long conversations withArt. When he came to Scotia at that time, you know, he'd call me at every ... well, because our offices were so close too, I'd go walking by then he would go, hey I got something to show you!
Rod: He's always got something to show us.
Eric: So of course I loved talking about this stuff, you know, like even with like Ken, where we meet monthly to talk about what he was building out. And so Art's conversations were quite deeper and a lot more involved, I suppose, into the different components of where return is derived from.
And so that was quite interesting to me. Another thing that Art used to do, which I thought was really cool was when we looked at adding value, what advisors were adding value for their clients. And you can track this on a monthly basis just through what the firms produce, which is their kind of their score cards, which is like, okay, each month over month.
Here's your AUM. How is it growing? Here's what a balanced portfolio returned for the year. You know, say it was like 6%. If you just started off the year, January 1 with this much in AUM, and then December 31st you had this much, and if you just grew it at whatever the market balance return would have been, that 6% or whatever, most people should have grown by that much.
You know? So what we found is a massive chunk of advisors who are running more of a transactional based business, at least what we assumed they were doing, they would just constantly be hemorrhaging money throughout the year. And then we could look at these other advisors and be like, well, yeah, they're actually growing. You know, they're growing up that rate of what the market grew at, what a balanced return should have been for that year. So they are adding at least value to their client base, right?
Art: Yeah. I know guys they would destroy wealth with their stock picking was what you noticed very quickly.
And when Eric and I would look at that, and we know this intuitively, but you know it was really I decided to do this because I would argue with management over resources all the time. So it was one of the best tools had to say, you know, like I thought you guys were supposed to be adding wealth to these clients and it looks like these guys are getting the yachts.
When you go to wealth, you have a holistic view, but that old transaction model, what was even worse than those numbers, probably the top 20% of the guys actually maybe beat the market. But 80% of the other clients underperformed massively. So not only was the number horrible, but in those numbers you just intuitively knew.
Because we had been in that, you know Eric had started in our practice. I had been in the practice for a long time and really your job is to find, you know, 15 to 20 stock addicts, junkies that will continually turn over the portfolio. And some may be successful or not. But the ability to do what Eric was trying to do as a young advisor that was so attractive to me because we had gone to Scotia as well to build out our wealth business.
And he was just adamant in his belief and it was wonderful to watch. I was trying to say, you know, that's great but also make sure that if you can get into money management in the right way, you're going to scale all these wonderful decisions you're going to do. Not like the old business. So, yeah, that was a fascinating look at a brokerage firm.
Eric: You know, I'm not here just to maximize my trading revenue, even though firms love that. But, you know, I think, you know, if you care about the long-term growth and effect on your client then you should be looking for the best solutions at that time. The factor based conversations were really interesting.
They're really heavy. You know, for me again, my whole mindset was get the planning in place, make sure you're doing the right thing for the right reason, and then use a managed money approach, or bring in like the institutional players, or the right type of automated portfolio of management that handles that for you.
And then it's just a matter of checking on that portfolio and making sure it's doing what it's supposed to be doing.
Rod: So Art, you often talk about two camps in the advisor community, those that have come from an investment focus perspective and those that have come from a planning focus perspective. I think what I'm hearing you say, Eric, is that through time and through your journey, you sort of become more planning and service oriented.
And have your portfolios and investment side of things, more or less in a rules-based system or on autopilot based on the best practices that you've learned.
Eric: Yeah, exactly. You know, and I find if you find the path to the most efficient type of solution, if you can get there. Then it's just a matter of keeping clients aware of what's going on under the hood of the car.
It's one of the dangers I've found with managed money is that you're not contacting clients as frequently as they were trained to be contacted before to talk about trading ideas. I never hear from my broker, you know. The dangers of the managed approach are there, you know, so I find you have to shift topics of conversation and stuff to something else, right?
Because you're not calling them all the time about making these trades. And that was another thing that I thought was really interesting in Art's approach. It was very science driven. You know, I call it the white lab coat conversation. So if a client really did want to go down that rabbit hole, like if you had a few engineer type clients, they would appreciate that. So for me I was at that point in time where asset gathering, planning based, managed money, not a lot of frequency of contact on a monthly basis to talk about what the mechanics what's going on within the portfolio as a result of managed money. I had to find some other way or some other excuse, I guess, to up my contact frequency with clients. So I figured, well, this is something else. This is something new that most people aren't being made aware of. And so for me it was like, oh here's another avenue. Here's another conversation.
Here's another excuse or reason to reach out and talk about why we're doing what we're doing with their money.
Art: One of the seminal events, I guess, in a smart beta quant factors was in 2009. The Norwegian Pension Plan after the financial crisis that Eric had alluded to earlier, and my God, what an event for me after all these years in the business, like, to see companies like Merrill Lynch and these cornerstones that you would watch on Louis Rukeyser, which is an old show on PBS.
Like these, you know, Lehman brothers were these stalwarts of the industry were no longer in business. So post that the Norwegian Pension, which is very transparent and run and has to talk to the Norwegian people. They did not do well in the financial crisis. And this is one of the biggest pensions in the world.
So, if you're in the asset management business, you would actually probably go give your best ideas to them for nothing, just for the reputation to say that you're dealing with them. So they could get anyone in the world to run their money. And they brought in three academics. What happened is they looked at the factors that Eric kind talked about in this podcast.
And at that time the kind of idea was coming out of academia. This was getting a bit bigger, but what happened in the pension is these were kind of considered styles. You're a market aficionado of funds. You know, you go onto Morningstar and they've kind of got a style box and they'll say, you know, you're a growth manager of value manager.
And they were thought that they were not as a big deal. And these academics went into that pension and they said, actually, your active managers are only using these factors to produce the returns. And so the Norwegian Pension fired all of their active managers and started to build out factor portfolios.
So when Eric and I were talking I was saying, you know, you're using these kinds of institutional managers, you're on the right track. But I guess the disconnect for me was that these institutional people are actually using the same stuff we're using, but they still have the human bias in it. And you're back to selling that this guy's a good manager and that. Where if you could change the color to where returns come from and why the market works you have much better control over the planning and outcomes and the goals you want.
So that was a huge part of the conversation. And that was a huge event for people in our world when that whole pension plan switched over. Can you talk a bit about our conferences that you've been to? You got to see some of the scientists we work with and you got fully immersed in the smart view world.
What have those been like for someone coming into this world?
Rod: I thought the hikes were the best part of the conferences, myself.
Art: Actually, Patty and Nicole organizing all the wonderful things is the best part.
Eric: Yeah. The beautiful settings of Lake Louise. No, you guys do a great job on that and just the caliber of speaker and talent that you guys bring to these things. I've never seen something like that before. It's not like a Fidelity Conference where they're bringing in all these rockstar managers of the moment, you're bringing in some of the best minds. You're also bringing in, you know, people, like from the finance and mathematics departments of the University of Calgary to come along and hear the story. And they get to talk about what they're working on for this next batch of students that are coming through. And so you're hitting it on both angles, right down from that educational piece at the university level and straight through to people who are in the seat, managing money or making decisions on behalf of clients. And then people who are, you know, very well known writers and finance bloggers and you know. So you've definitely done a great job of covering all the bases at these conferences.
Art: How did the scientific approach help you when you saw it in person?
Rod: What were your takeaways?
Eric: Being up here in Calgary, Canada, you know, we're, you know, tiny little pond up here, I guess when you compare it to like the United States. And you guys are bringing up the guys who are leading the charge in factor based investing, rules-based investing, in the United States. And I always find that, you know, Canada, we're a few years behind on that pickup. And so I always leave your conferences with a lot more ammunition and a lot more conversations to have the clients that aren't actually taking place right now in the brokerage world, in the advisor world.
At least here in Calgary at any sort of large scale, that's kind of one of the great benefits that I've gotten from the SmartBe Conferences is bringing a lot of those new concepts and ideas that people, our clients, aren't actually being presented.
Rod: Less out of the marketing sphere and more into the scientific method and academia sphere.
Eric: The white lab coat scientist, you know, heavy, heavy, heavy science approach to this. It's my job to take that information and repurpose it, I suppose, and rebrand it into something that general public can understand. Rod, you always do a great job at those conferences of summarizing, you know, a very highly technical presentation into very simple language. Because we can go so deep down that rabbit hole. But if you lose your client, who you're trying to explain the concept and philosophy to, they either A, are stunned into I just trust you. Go ahead and do it. Or, B, I have no idea what you're talking about.
Rod: Or like your CFO they're falling asleep as you're getting into the weeds.
Eric: Yeah, leaving the conference, listening to some of the greatest minds that are kind of in this space and then taking that verbiage back through my marketing and my communication back to my clients and my centers of influence. So I could do a pretty good job speaking with, you know, a few people I know and trust and estate lawyers and tax advisors here in Calgary.
But I think the next step for me, I was thinking, would be to actually invite them out to one of your conferences, because I think they need to also see it firsthand.
Rod: Art often talks about, as he talks about raising two twin teenage daughters, that with all of the innovation, with all the technology, there is a very interesting space for the type of individuals that has the ability to take in the deep dive scientific.
So not put the light white lab coat on whether it's in finance or AI or machine learning or whatever space that is, but has that unique ability to be able to walk in that world, understand it, but moreover communicate it to the masses in such a way that's palatable and gets through the biases and creates that emotional connection.
So it seems, Eric, that you do a fantastic job of that in your practice. And my next question is, you know, you've got a really healthy business and it's growing and you're out in the community a lot. Tell us, and tell the other advisors that are listening to the podcast, your secrets to having successful capital campaigns.
Eric: You cry a lot, no.
Art: You beg.
Eric: Beg, cry, anything you can. No. What I've found with most clients, or people out there in the world, they've been pitched to death. So if you're actually going to go out there to a prospect and say, hey you know what, I'd love to talk to you about this. They're going to be like, well, I got 30 calls a day to talk about that.
There's no interest. So what's really worked for me is kind of doing more experience driven events. And so what I mean by that is well, okay if we want to talk about the, you know, the future of AI and how AI is being incorporated into your portfolio and investments, you know, I'm not just going to say, okay, come to this presentation on AI, because people are gonna be like, well, there's 20 other guys out there inviting me to something similar.
Instead we did, well, we're going to host something at the Tesla dealership and we're all going to go test drive Teslas for the day. But I'm flying in the PM from Horizons ETFs or something from Toronto to join us that morning. And he's gonna give us, as we're having coffee, he's going to give us a history of robotics and AI and automation, and to get to where we are today. I would tell anyone on the street, any doctor, any prospective client, like that's what we're doing.
They'll all show up for that, you know? Because they're getting something of an experience. They're getting a connection with the underlying story, you know, i.e. the whole Tesla and electric car thing. They got a unique experience, but then they also get a very smart presentation on not a product, but just like the history and what innovation is happening in that industry.
So you make those two connections. I found that the closure rate on that was incredibly high. The participation rate in that is really high. So again, I think being pitched to death, lunch presentations, knife and fork presentations, you can get a lot of people out but no one will have any buy-in, you know. But if you have a neat experience set up for somebody, but they also feel a bit smarter leaving it, and the two tie into each other, that's been a big reason why I've been able to drive a lot of new assets in the door. So again, you know, you just want to create that story in which people will go and then tell their friends and their networks about what they were up to.
Rod: You also use the volunteers sphere a lot in that piece that may be interesting.
Eric: That's been the second thing.
I've been nominated for a lovely award this year from Wealth Professional. For excellence in philanthropy and community service, and that gala is taking place next week. So we'll see if I get across the finish line for that.
Art: I think you're already across the finish line, just in focusing on service, I think, in a business where a lot of the times you're in your own head.
And I've learned this from you, Eric, and I do it myself, but service is one of the only times that you're actually not thinking about yourself and you're doing stuff for others, and it's probably one of the purest gifts you can give yourself. So I want to hear more on that.
Eric: What a concept, hey? You know, so I'm the current president of the rotary club of Calgary this year. Been a member of the Rotary, the downtown Rotary Club for 10 years. So I found that early, when I was 30. And that was at a time when I came, you know, just to come over as a rookie starting from zero and all these other rookies, I think in our rookie club with 35 of us. Now, I think there's four of us in the industry now.
But at that time, everyone was like where are you going every Tuesday? How can you give away all these hours. You should be out there closing business and blah, blah, blah. I'm like, well, I kind of am. I found Rotary through a prospect. I was prospecting and he said, hey meet me at the Palliser for lunch.
And I showed up there and there's a big group of people, a couple hundred people in this big crystal ballroom and they sang O Canada and we marched in and, you know, I got to meet all these businessmen from Calgary and businesswomen and the guest speaker that day was the chief technical officer for Virgin Galactic.
So that was Branson's space travel company. And I'm sitting there going like, oh this is our guest speaker? And she's talking about the future of space travel and, you know, afterwards I got to hear a little bit more about what Rotary was and what they did in the community and what they did around the world.
And I was like, oh, so it's just a volunteer service club. You guys meet up and, you know, I looked around the room and I'm like there's the owners of the Calgary flames. And I'm like there's the president of that major oil company and there's that and there's this and there's that.
And I'm looking around the room going like, huh, this isn't a bad place for someone like me. Who's just growing a business just to hang out. You know? So I thought I found it first from a truly selfish point of view to prospect these guys. I learned so quickly that it was so far from the truth, you know, I don't think I prospected a single Rotarian. There's actually quite a few members of the club who are clients of mine, but that was a result of me inviting them to join the club and showing them what rotary was. So I used that forum, a service club, to invite prospective clients to join me for certain guest speakers and certain lunches. And to explain to them about all this projects that I'm involved in, you know, and they get to sit there and look around the room like I did before.
And they look around like who Eric's hanging out with every Tuesday, who aligns with his moral compass and so on. And that was just another thing which allowed people to feel a little bit more confident in looking at me as someone as a professional partner. So I closed more business that way indirectly instead of actually prospecting a group like that. Which a lot of people join service clubs like that to prospect the membership. And you can see it. I think there's, you know, there's a bunch of advisors in and out at one time, they usually last like a year. Then they fade away. They're there for the wrong reasons. They just want to close business immediately and they find out you're in that it's not lucrative to them.
So they move on. You know, I stuck it out and I've been involved with all these different projects and been involved with running the club, been involved with booking the speakers, you know, so it's just been a way for me to really shrink Calgary into like less than a degree of separation, you know?
Because when I reached out from the Rotary perspective and say, you know, would you like to come and be a guest speaker? Mr. So-and-So we meet Tuesday at the Crystal Ballroom at the Palliser, you know, we have a couple of hundred people in attendance and yada, yada, yada. I'm not calling them, prospecting them above their money like 99 other people calling from an investment firm would be talking to them about. I'm bringing them out to something. And then when I follow up with them, you know, a week or a month, the circles just shrink. You start to see these people out and about in the community. And now I have a relationship with them.
We're kind of on an even level versus someone trying to get through their secretary or whomever to sell them something. I meet them out at a restaurant and I go, Oh, hey Mr. So-and-So or whatever. And then people are looking around going, how do you know that guy? You know, he's my boss or whatever.
And it's like, you know what? I invited him to this and that and whatever. So that's been a massive expander for me.
Rod: It's a long game. It's a very long game. And it speaks a lot to your character.
Eric: It's a life game, you know, and that's what I realized, you know, being around these people it's a good thing. It is like a community building thing. It's something that's not regular in society anymore. And then that it stands out. And I think it's even more important now because everyone is so involved with their, you know, communicating this way or through their phones right? So you have less of that personal engagement interaction within your city and community.
And so when you have these sort of clubs that exist and have those options, you know, like it's just an amazing thing. Like if I missed a meeting or two I'd be getting a call from someone, you know, like George Brookman. Hey Eric, I haven't seen you at meeting, at Rotary, for a couple of weeks.
You okay? You know, I'm like, wow. You know, the president of this is calling me directly just to see if I'm okay? How cool is that? You know, like what a family, what a community involving yourself with a service club. And so it's also that ability to give back into a community, but it's also that fellowship and camaraderie that you're building.
Which, again, is such a rare thing in our digital age now, you know. I think that these types of clubs are going to be more important than ever to maintain that actually human relation, right? Yeah. What a concept.
Rod: Yeah. That's awesome. Eric.
Art: Let's face it. We're in sales and there's a part of us that is selfish as well.
Because we're humans. And there's part of us that's magnanimous and gracious as well. We're all of these things, but it's fascinating, Eric, how along the way what is so attractive about you as a person is there is just a goodness and a trusted advisor to everything you do. And even the self-recognition that you went into Rotary selfishly.
I mean, you know, people can't even recognize that, but it's wonderful to have someone like you in financial services and you represent the best of, kind of what this business can create. And then also in the Calgary community to have someone as enthusiastic as you. Community is such a hard thing to get in this world now yet you can just see how vital it's been to you and it's vital to all of us.
I think your journey has just been fascinating to hear.
Eric: In this world, or at least what I've been seeing, media is becoming less and less reliable. You know, how can you communicate a theme or a concept through a five second soundbite? And so now there's like the big fights of the big news media outlets out there to who's fake and who's not.
And I honestly think the form of the podcast is the saving grace going forward. You know, having long form free form conversation like this, like a podcast. People love to see this, you know, they love to see real people having true conversations. Speaking about concepts and ideas and working through challenges and problems and finding solutions in a proper way, versus just like a derived five second soundbite that you get through a newspaper as you get through your BNNs and CNNs and Fox News' and everything like that.
So I honestly think that right now, like what you guys are building here is, you know, just the start of it. And I think for people to get real information this is the forum where they'll come to.
Rod: It's such a pleasure, Eric. If I'm taking away a few things from our conversation today, pretty early on you realize that rules-based was critically important to cover off on your behavioural biases.
I really liked that point. And the other point of shifted from your pitch book to your red book. Listen, listen, listen. And, you know, we had a conversation with Mark Miller from Constellation Software in another one of our forums. And he was just all about patience and listening. So you're reiterating a common theme that if you're going to get into this service world, you have to be good at listening to what the needs of your clients are.
And I really liked your perspective around using a social platform of service in the community. Not necessarily for direct prospecting, it felt more like an alignment of values where you're able to build trust and establish relationships with people outside of business, because you're genuinely interested in them that has enabled you to be successful in growing your book and making things tick for you.
Art: It's really important that at the end of the day it's not even the return. It's what you're going to keep. So if you lower your fees, if you buy factors that actually have a reason why you're going to get a return. All of these little things add up. If you focus on, you know, ETFs are extremely tax efficient, that's Eric's appeal to them.
All of these little things, the things that you can control, are going to have probably a bigger impact than trying to do all the things that you thought you should do. When Eric, you know, went from being a chef to this, I mean, he probably thought it was all about these other things. And then in this massive journey, he's learned no, it's actually about what you get to keep after all of this crazy stuff. And I believe that's why, you know, it was always about that in our conversations. And then the other big thing that I always loved about our conversations was he recognized that this is such a behavioural journey for people.
That having the right ability to communicate in an empathetic and understanding way, how behaviour derails your investments, and it's just coloured every part of his life. So it's been just a great conversation.
Rod: Thanks so much, Eric. And to our listeners today, you've been listening to Modern Investor Journey.
I'm Rod Heard, co-founder of SmartBe Wealth. I'm here with my partner, Art Johnson. We've been talking to Eric Bennett. Who's a senior wealth advisor at Scotia Wealth. Eric, it's been such a pleasure. Thanks so much.
Eric: Thanks for having me guys. I look forward to the next conference.
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