Refresher Course

The imminent launch of a new restricted advice business by SimplyBiz will revolutionise a “tired” sector, according to its founder Ken Davy. Subject to FSA approval, the Huddersfield-based compliance and business-support provider is preparing to launch the new proposition by late summer. Codenamed Refresher, the business is the subject of an initial £2m investment by SimplyBiz, and will create up to 30 new jobs - with further expansion promised as its membership grows.

Matt Timmins, joint managing director for SimplyBiz, said Refresher will be a national advisory business and will compete with the likes of St James’s Place and Openwork. He added: “It will help take away the burden of regulation for advisers with an attractive price structure. We hope we can cater for the many advisers out there who want to give advice but who also want to be kept on the right track regarding regulation and compliance.”

Steve Braidford has been appointed as managing director of the Refresher project and will relinquish his role as group sales director of SimplyBiz and as managing director of the company’s New Model Business Academy to concentrate on the new business.

Ken Davy said the company was looking to support the restricted sector post-RDR with a “market leading” and “exciting” enterprise which would deliver benefits for advisers who chose not to become directly authorised. He added that Mr Braidford was the best candidate to lead their new venture as he had “driven the outstanding membership growth of both SimplyBiz and the NMBA”.

SimplyBiz serves in excess of 2000 IFA firms and more than 5000 advisers, while the not-for-profit NMBA offers financial services training and development to 12,000 registered users.

Mr Davy who is also chairman of rugby league team Huddersfield Giants, and life president of Huddersfield Town FC, said: “SimplyBiz is recognised as the standard bearer for independent advice and we are confident that the great majority of the firms we serve will continue to operate as directly regulated IFAs post-RDR.

“Indeed our latest membership survey shows that 93 per cent of firms intend to remain independent after December 2012. Nonetheless, SimplyBiz has always stated that we will not turn our backs on the restricted sector, and we believe that this part of the market is currently underwhelmed with old-style offerings which have gone stale and deliver little value.

“We aim to change that and launch the most innovative and successful national in the market. Make no mistake we are not following the market, we aim to lead it. When we launched SimplyBiz we said we were going to light a fire under the financial services sector by breaking the mould on compliance and support costs while delivering high quality services.

“We have done this in spades, and have now identified this major new opportunity which will enable us to deliver fantastic benefits to the many high-quality advisers who prefer not to be directly regulated.”

Despite being coy on the specific mechanics of their new offering, Mr Davy added: “Refresher will reach parts of the market which have not been touched before in terms of service for both advisers and their clients. The feedback we have got from restricted advisers is that they need a fresh start.

“We’ll be releasing further information in due course but there will obviously be a big emphasis on compliance. It’s at the heart of everything we do. One phrase we always use here is that everything needs to be regulator-friendly and client-focused.

“We have a history of making a big difference when we get involved in something, and this new enterprise will be no different. We broke new ground with the NMBA, and it’s no accident that it is the market leader, while the SimplyBiz model of charging a monthly fee of 2.5 per cent has overcome a lot of sceptics to attract a huge membership.

“This new venture has the potential to make a bigger impact on the sector than the launch of SimplyBiz itself.”

Mr Braidford said: “Having worked with thousands of advisers over the years I have seen all too often that their growth is hampered by the very organisations which should be helping them succeed.

“I am determined to provide advisers with the opportunity to prosper by doing what they do best which is spending time with clients. I am equally determined to dramatically reduce their administration and compliance burdens. We will be giving advisers the opportunity to enjoy the benefits of a national brand, while reducing costs and significantly increasing their profitability in the post-RDR world.”

Mr Braidford added that the new company’s application with the FSA was being processed, and that he had started to recruit his new team. He said: “We will be trading from a separate headquarters to SimplyBiz and as a completely new enterprise, from the paperclips upwards.

“We expect to scale up the operation as we attract our client base and we’ll avoid overstretching ourselves. Services are often sacrificed for membership growth in our sector. When that happens any hopes of offering good service backfires. We expect it to become a significant player in the restricted market.”

Harry Moore, the proprietor of Bedfordshire-based Harry Moore IFAs, said: “It is no surprise to me that they are looking at the restricted sector. You can’t ignore restricted, and there is always a place for different advice models.

“Personally, I plan to remain independent post-RDR, but if that changed and I had to look at the restricted model I would obviously look at their new venture. If the service is anywhere near what SimplyBiz offers to independent advisers they would be an obvious choice. Good luck to them.”

Kevin Hopwood, director of Berkshire-based the Hopwood Ash Financial Planning Consultancy, said: “What Ken Davy is trying to do for the sector is pretty much as good as it gets. He had great intentions for the IFA sector, and SimplyBiz’s proposition is absolutely excellent. Such praise from people in our line of business is rare, but the service they provide is difficult to criticise.

“Going restricted is a good move for some advisers, and if they do transfer to that space any proposition for something like SimplyBiz would be very good .”

Nigel Speirs, the chief executive of Denbighshire-based Sanlam Private Wealth, said: “We recently undertook a client survey, and only two respondents said independence was the thing they looked for most. The important thing for them was simplicity and transparency at a reasonable cost.

“Sanlam Private Wealth employ a similar proposition. We are obviously owned by Sanlam and they are our first port of call. We then look at the whole of market if required, so you could say that we have a part-restricted model.

“I’m delighted SimplyBiz has joined the camp, and it makes me think, especially given the huge amount of compliance required, why a sole trader or small IFA firm would not consider adopting a restricted model. Our restricted offering has a simplified charging structure with one fee and is very popular.

“There is a lot of emotion attached to remaining independent but I’m sure once we have settled down post-RDR people will realise it’s a good, transparent option.”