Flying Colours: How Guy Myles is bringing holistic advice to the masses
Earlier this year, Guy Myles, former managing director of Octopus Investments, launched Flying Colours, designed to offer low cost advice to consumers using innovative technology.
Here, he explains to Adviser Business Review his mission to bridge the advice gap with the ‘next generation of financial advice’, the type of client the firm expects to attract and the role of technology in bringing advice to the masses.
Adviser Business Review: What inspired you to set up Flying Colours?
Guy Myles: First and foremost, we don’t want investors to be forced to choose between affordability and professional advice. Flying Colours is redefining the meaning of lower cost but full service financial advice and investment management.
The majority of people who could benefit from investing their money do not want to pay the high fees associated with personalised financial advice. This means that most people on lower incomes are either not advised or poorly advised. There are also lots of people out there who could afford the fees, but fail to see the value in it. That leaves just a very small section of society who are able to afford financial advice, understand the value of it and are comfortable with the service they are receiving.
I saw various problems in the advice market and felt now was the right time to create a solution. The advice gap is a well-publicised problem and it’s important that there is a proposition for those who fall into that gap. For me, there are three things we want to address as a business; access to advice, low costs and investment discipline.
ABR: Who do you expect your typical client to be?
GM: We are not seeking to offer robo-advice, we will deliver holistic, life-long planning for our clients but the difference between us and other firms is that we can do it for clients with assets of just £30,000 thanks to our use of technology.
It’s very early days for us, but the average age of our client is 60 and while we don’t have an age limit in place, we are expecting the majority of our clients to be between 50 and 70 years of age. We don’t have restrictions on who we offer advice to, but we do believe those upwards of 50 will be most attracted to this proposition. The value of advice is much greater the older you get, and the needs of older clients are often more complicated and pressing.
ABR: As a new business, how do you plan to attract clients?
GM: We have three strategies we will use to grow our client base.
There is direct to consumer, which involves marketing directly to those individuals we believe would make good clients. We will do this through a mixture of press exposure and producing content for the Internet and we are considering direct mail and an advertising campaign of some sort.
In addition, we are exploring partnerships with large financial organisations and we are seeking to work with those financial advisers who need somewhere to refer clients who don’t meet their requirements.
ABR: How does technology enable you to offer low cost advice to clients?
GM: There are two basic things we do; our advisers work from a central location and do not travel, although we would be happy to host clients at our office if they preferred, and we use technology such as telephone and video calls to engage with clients.
The use of technology in delivering advice enables us to use our time more efficiently. We’ve built a system whereby after we create advice plans for clients, we can update it easily and at low cost to incorporate the changes we see in their circumstances. Clients also have access to their information on the client portal, where they can track their investments and update their information.
Because technology allows us to keep our underlying costs down, we are able to ensure that the costs we pass on to our clients are very low and that’s of huge importance. We know costs are important because we have conducted detailed research into average returns of UK investors.
Our report has revealed that the average UK investor is missing out on 2.1% growth every year, which over 15 years equates to missing out on 35% of additional growth.
So far, the response to our proposition has been fantastic; clients understand that in order to offer advice at a lower cost than traditional financial advice firms as we know them, we need to offer a different kind of service
ABR: What are your plans for the future?
GM: We have a lot of potential clients in the pipeline and we’re ahead of schedule in terms of client numbers. We see big opportunities for a business like Flying Colours – there is a large, untapped demand for advice and low costs so we have created a proposition we expect to grow.
I think we have a great chance to really succeed, but, of course, this type of service hasn’t been offered before so as with anything that tests new ground, you have a to wait and see how the public take to it.
Visit the Flying Colours website