What Advisors Need to Focus on Next with Stephen Langlois

• Beacon Strategies, LLC
• LinkedIn: BeaconStrategies
• LinkedIn: Chip Kispert
• chipkispert@beaconstrategiesllc.com

[00:00:00] Intro: Welcome to Beacon 1% Better Every Day with Chip Kispert, founder of Beacon Strategies. This podcast is all about challenging the norms of wealth management and empowering professionals to make continuous progress and always be curious. Chip knows firsthand how small, consistent improvements can lead to big breakthroughs, and that’s what we’re focused on here, helping you get 1% better every day.

We’ll dive into conversations with industry professionals, share actionable strategies, and explore the mindset needed to overcome industry challenges and create lasting change. Let’s be curious, push beyond what’s always been done, and uncover better ways together

[00:00:51] RJ Malyk: Welcome to the 1% Better Every Day podcast.

I’m RJ Malyk, uh, your producer. Our guest today has spent more than two decades serving [00:01:00] advisors from nearly every angle in this industry. Most recently, he served as president of Kestra Financial. Today, he leads Seaport Consulting Partners. Please welcome Steven Langlois. Chip, it’s all up to you. I’m passing the baton over, so take it away.

[00:01:16] Chip Kispert: Thank you, RJ. Steven, welcome. Thank you. I’m glad to be here. I’m touched that you wanted to talk. It’s interesting ’cause we go all the way back to college, but I found- … you’re one of the people who has- 20 years ago in college … 20 years ago.

[00:01:30] Stephen Langlois: Yeah.

[00:01:31] Chip Kispert: You’re one of the pe- those people that has super insightful things, um, that you think about as it relates to wealth management, and I’m, I’m super excited to have you on the show and, and kind of get into a, a, a Q&A and have some great conversation.

[00:01:48] Stephen Langlois: I am too. Hopefully, I’ll be insightful. I don’t know. I’m not sure my family would agree with you, but that’s okay.

[00:01:54] Chip Kispert: I have that issue as well. But anyway, all right. Hey, let’s, let’s look at the first question, right, I mean, [00:02:00] that I have and it… You know, kind of when I went back and did some research on what you’ve done, I was like, “Wow, you have, you have been at a number of places,” um, you know, LPL, Fidelity, uh, eMoney, um, and you’ve, you’ve wanted all of them, in my mind.

Um, and so but I’m really, really kind of interested in kind of what you think and, and what has that journey taught you about what advisors really need-

[00:02:38] Stephen Langlois: Mm-hmm …

[00:02:39] Chip Kispert: and, you know, if I keep going down that path, um, you couldn’t, you couldn’t have learned any more, um, with your journey.

[00:02:48] Stephen Langlois: Yeah, no, you know what? I, I…

First of all, I love what advisors do. I, I, I really do think there is no more noble profession out there. I mean, these guys and gals are absolutely the [00:03:00] doctors and nurses of finance and do incredible things for mainstream Americans. Um, I, I, I just think it’s am- amazing what they do. And as I think about over time, not only in wea- wealth, in particular in wealth, like one of the things that I’ve learned and seen is, um, there, there are so many ways to win And I used to work with, like, this crazy guy at, at, at LPL, Lincoln Anderson.

He was our chief investment officer, and he would say, “No one has a lock on the truth.” And I extend that to, to ways to win, that there, there is– there are multiple ways to win, and there is no one right way to be successful in this business. I think there… You know, as long as you have integrity and, you know, follow the rules and, and, and…

But, but most importantly, do right by your clients and stay focused on what [00:04:00] is right for your clients. And, and I think you do that by delivering… The people who win are those who deliver tangible value to their clients. Um, and that takes many different forms. For some people, tangible value is outperformance on a portfolio.

For other people, tangible value is, “Help me send my kids to college,” you know, “Help me retire and buy that boat,” or whatever it is. And, and I think that there are… The people that do it well are those that listen to their clients, that serve them authentically and, um, and keep… You know, think about this as a, a, a business.

Um, it– this is definitely a space that we’ve evolved from being a practice to being a business. And I always think, like, you never wanna say, “This is my practice,” ’cause I don’t wanna hear, like, my doctor saying, “I’m [00:05:00] practicing on you,” right? No, this is my business. Um, and so… But, but I think all great b- all great businesses kinda come back to, are you doing right by your client?

You could be providing wealth management services, selling credit cards, selling cars, whatever it is. It’s, it’s are you delivering value to the customer? And I mean, goodness, I learned this way back, you know, in the day when I worked at Bain & Company, the consulting firm, and I worked with this, this guy, Fred Reichheld.

He was the father of this thing, which was novel at the time, that’s how old I am, called the Net Promoter Score. Fred inve-invented the Net Promoter Score. And, and at the end of the day, what they lear- Fred learned was that you can’t say, “Are you satisfied?” That’s not a fair question. It is, “Would you recommend this service, this product, this whatever to your friends and family?

And if on a scale of zero to ten…” And if you gave it a nine or a ten, you were a promoter, and those people that were promoters [00:06:00] grew much more quickly than those who weren’t. And that, that’s what, uh, that, uh, manifests are you adding value to your customers? Um, so I think that’s important. The second thing as I reflect over time is facts and data matter.

Like, you have to build a strategy, build a business around facts and data, not emotion. Not emotion. ‘Cause at the end of the day, um, the path will get revealed by really truly looking at the facts and the data underneath each business situation or, or opportunity. And it takes a little additional work to understand, I think, those…

Us-develop a fact-based strategy or business plan, but at the end of the day, I think it serves people well to push that pencil and, um, and be ruthless about what, what is going on in, in a business. And then I guess the other thing I think about, Chip, is these, at the end of the day, are service businesses.

Uh, financial advisors [00:07:00] are providing services, right? They’re not selling a phone or, uh, some widget. It’s, it’s service, and service is enabled by people. And so I think as important as how you treat your customers, it’s how you treat your people because your customers are gonna feel whether your, your people, your team is feeling motivated, is feeling valued, is learning.

Um, and that, I think, is what separates great firms from mediocre firms is, is firms that really treat their people well. Um, and, and, you know, create a career path, um, enable them to have impact, uh, enable them to really participate in the value creation process, right? I, I love when you see these firms that bring the juniors in to meet with clients.

You know, don’t keep them back in the back room. Like, let them see how the sausage is made, um, what those client [00:08:00] experiences really are, and they will become better professionals as a result.

[00:08:04] Chip Kispert: That was super. You know, one of the things I look at what, what you just said is succession plan, right? Big problem these days.

Um, and getting those junior advisors in the mix, um, you know, not only helps with serving the client, right, but potentially even starting them on their own book in some way, shape, or form.

[00:08:28] Stephen Langlois: Yeah. And appro- when it– where appropriate, I’ve seen this before, like bring in some of the ops people into the client meeting, right?

At the end of the day, who’s filling out the paperwork, right? Who’s processing all that stuff? It’s not just the people that are, that are the advisors or even the junior advisors, it’s the f- the folks who are the CSAs and others and, and have them have exposure to clients ’cause I think that it just also gives people a little more purpose and understand, you know, why we’re asking them to do what they’re doing.[00:09:00]

[00:09:00] Chip Kispert: Absolutely. I’m gonna throw this in, and I’m interested to hear your perspective, but if you looked at the last twenty years, um, how do you see the role of the advisor changing?

[00:09:14] Stephen Langlois: So when I first… When I left Bain and s- came into this space, I went to work for this just wonderful firm called Scudder, Stevens and Clark.

It was, you know, it was described to me by the headhunter actually for this role as this, there’s this stodgy little investment firm downtown in Boston that’s looking for somebody, right? Um, and, and Scudder was one of the first firms that actually invented the mutual fund, but it was an investment management firm.

Um, and, and although, though it did actually have a private client business, you know, it was one of the earliest, it was called Scudder Private Investment Services. Um, and, and so we came at everything ab- it was all about returns, right? It’s, it’s, are, are the returns of the portfolio beating the benchmark?

And that was not only because of [00:10:00] what we did, but also that’s how advisors really, at the end of the day, measured their success. Am I beating the benchmark? You know, and that was in the nineties, um, you know, pre, pre, pre-dot-com. And everything was all about, you know, returns, returns, returns, returns. I think what’s changed is now it’s about, are you helping me achieve my goals?

And, and, and are you… And there’s this construct that, that Fidelity actually built off a Bain concept of, of the c- the value stack, called the advice value stack, and at the foundation of it is investment management. And then it’s, are we achieving your goals? Are you achieving purpose? And then per- leaving a legacy, and those are the higher levels of the value stack.

And the data, funny, we’ll talk, talk about data, the data shows that consumers have di- placed different levels of value on the value stack. They place more value on the higher levels of the value stack. But what’s interesting, and this, I think it’s a [00:11:00] generational thing, Chip I guess we’re bo- I’m a boomer.

Yeah, you’re almost a boomer. Um, so boomers-

[00:11:08] Chip Kispert: I’m still X. Thank you

[00:11:09] Stephen Langlois: You’re X? Okay, good, good, good, good. Okay. Um, the boomers place a disproportionate amount of value on investments, on investment returns, whereas X and millennials in particular, that’s, that’s found not, uh, isn’t as, isn’t as important as a goal achievement, life’s– achieving a life’s purpose and, and leaving a legacy.

And so the value stack is getting flipped, and that’s what’s, that’s what’s changing, I think, is today a- advisors, um, are evaluated on how are they doing to help you achieve those other levels of goals. And a lot of these young k- people don’t really care about the investment portfolio per se. It’s all about the other stuff.

[00:11:52] Chip Kispert: Right.

[00:11:52] Stephen Langlois: Now, the other stuff, though, is where it takes a lot of time. Not– Doesn’t take a lot of time to manage a, you [00:12:00] know, discretionary portfolio, no disrespect to portfolio managers out there. Um, but, but it’s, that stuff is relatively… The time stuff is on the higher levels of the value stack and, and but that’s where the disproportionate value is for younger investors in particular.

You

[00:12:17] Chip Kispert: know, having a financial coach.

[00:12:19] Stephen Langlois: Yeah. Yeah.

[00:12:21] Chip Kispert: I’m gonna shift gears a little bit, Steven. Um, one of the things I found fascinating when you did leave Qestra was that you joined the Holista plan board. Um- And to me that says something, but I’d love to hear how that decision reflects kind of where you think comprehensive planning is heading and, and why it matters so much right now.

[00:12:51] Stephen Langlois: So, I mean, you can tell I’m a big believer in planning. Um, you know, I, I even had the religion before eMoney. But, um, but I think that [00:13:00] there is… Uh, Holistic Plan is exciting to me because they have a very specialized capability or specialized planning capability around taxes, right? And I gotta tell you, you lower someone’s taxes, that is certain alpha.

Um, and, and I– I mean, it really is. It’s, it’s, it’s, it’s dollar for dollar, like real tangible value. Um, and wh- and increasingly, consumers look to their advisors to help them with that, their financial advisors. Like, they want their CPAs to do their taxes and… But, but, but they really, I think more and more they look to advisors to say, like, “How can we, you know, add more value, create more value here by managing things in a tax-efficient way?”

And, um, so I think advisors are in a unique position to add that value, but they need tools, ’cause they aren’t, they aren’t trained tax experts. You know, um, I mean, unless you’re like you were a CPA who [00:14:00] e-evolved into a, into a wealth management role. So I was excited because I thought that the Holistic Plan team had a real clear vision and va- around how you can add alpha through taxes, how you can scale it, importantly, with the s- with software, um, and, um, and make it accessible for advisors it…

who are not tax experts and to their, and, and their customers. So that was it. I also, you know, um… Roger Pine’s the CEO. He was an advisor who had this insight, built the software. To me, it was analogous to what, you know, Edmund Walters was the founder’s, founder of eMoney. He was an advisor. He had a better way of doing it, right, off yellow pads and Excel files into a so- proper software.

So this, this… there were similarities that, that kind of attracted me, um, and I really, really liked the team. So that’s kind of what, what I saw in Holistic Plan.

[00:14:59] Chip Kispert: No, and [00:15:00] it’s, it, it’s fascinating how I’m s- you know, in all our roundtables that we’re having right now, planning is coming up and how to weave more tax optimization services in.

[00:15:12] Stephen Langlois: And it’s an uns- it, it’s a category that has not been that penetrated. So if you look at the last, um, T3 thing, uh, market survey, you know, like less than 50% of advisors use a specialized tax planning tool. So there’s a lot of white space for growth, uh, in the category. I think, and HostPlan is the market leader, um, and they’re, they’re well-positioned for that growth.

So I think there’s a lot more opportunity for folks. It’s kind of where e-money was when, when we bought e-money was at Fidelity. You know, um, I think we had like 25,000 users. That was it. It was a distant number two. Now they’re the number one ahead of MoneyGuide. Um, but, um, it’s ex- it’s exciting. I– It’s a fun space.

[00:15:56] Chip Kispert: It absolutely is. Um, you and [00:16:00] I have both interacted together in the independent channel for the last decade or so. Um, as you’re advising firms and you are seeing the industry move much like I am, okay, very quickly- Mm-hmm … what do you see the next five years looking like for the firms you may be advising?

[00:16:24] Stephen Langlois: I, uh, have a strong belief that is there is always a bull market for financial advice Um, I think the world is– I think we can agree the world is not getting any simpler. Um, and, and American households ne-need support and, and advice. And as we know, you know, the number of financial advisors at best is flat and is generally going down.

I mean, it’s, it’s a shame to me that more people aren’t getting into the business. Um, but I think that creates business opportunity, so for, for advisors to, to continue to drive growth. Um, but the big [00:17:00] challenge is gonna be, you know, a lot of advisors, you know, look like definitely like me and less so like you.

They’re old, you know, men who are getting ready for– to retire. And, and so there– that’s gets to the importance of succession planning, right? Of having successors, of thinking about how can I find the right home if I’m an advisor for my business. This is the, this is the largest single asset that most financial advisors own.

It is their life’s work, so it’s inherently an emotional decision to think about what am I gonna do for my– with my business, and also ’cause many of my clients I’ve gotten to become very good friends with, so I wanna make sure they’re, they’re well taken care of. So, um, so I think that’s– that whole succession planning, how do– what’s the future of my firm thing is really, really important, um, to think about.

The other thing is how do I create more capacity in [00:18:00] my business and in the industry? And that’s where I think AI is just going to have a profound impact on advisors. I think the people need to really keep an Open mind about how to use AI in their businesses because it can create so much capacity and help them meet that demand for financial advice which is out there.

Um, and at the end of the day, if they wanna monetize and sell their firms, the biggest driver of valuation is organic growth. It’s not asset growth, it’s true organic cash flow growth of am I gathering more assets, not am I just riding the wave of the market? Um, and so it’s finding capacity to serve more clients, to find more clients that’s gonna be important, and AI can play in that in a big way.

So I’m encouraging people to be, you know, to experiment, to try some of these new tools, [00:19:00] really be, be vigorous– rigorous about understanding how much capacity it’s freeing up and, and, and taking advantage of that. Now, some guys and gals will use that to go golf more or whatever, but the people that wanna drive their businesses and grow more, they will have more time, and it’ll make it a little easier for them to do their business without compromising the integrity of the solution that they offer their clients.

I would actually argue, I would argue like some of these note-taking apps and stuff like that, it helps you be a better advisor ’cause you actually– I don’t know about you, Chip, but me, I forget stuff from time to time. And so when the, when the AI-generated sum- note summary te- reminds me of the things that are important to the clients, it’s really re– would be really, really helpful.

[00:19:43] Chip Kispert: Yeah. I would add into that guidelines and guardrails for AI-

[00:19:48] Stephen Langlois: Yes …

[00:19:48] Chip Kispert: for wealth firms.

[00:19:50] Stephen Langlois: Yeah. Sorry. Yeah, yeah, yeah. Well, generally, your compliance officer is gonna help you with that, but yes.

[00:19:55] Chip Kispert: I’ve been having lots of questions with firms about this direct subject. [00:20:00]

[00:20:00] Stephen Langlois: Yes. Yeah, and understanding what the, what the software provider is doing around that stuff is really, really, really important.

[00:20:07] Chip Kispert: I always love to ask this question, um- Who are the people and companies that are impress you out in the marketplace today? Um, and what are they doing that other firms may not be doing that folks should pay attention to?

[00:20:26] Stephen Langlois: Well, uh, so this is, this is, this is not an ad for my former employer, but I think James Poore and the team at Kestra are doing amazing, amazing things.

And while I knew of Kestra before I joined the firm, you know, I had met– 10 years before, I met James in the back of a bus at a Fidelity client event. And I knew one side of Kestra serving it at– when we were at Fidelity and Edimoney. But what I didn’t appreciate was the power of focus and what makes that business, whether it be the Kestra [00:21:00] side of the business or the Blue Spring side of the business, great, is a maniacal focus on what we do well and what we don’t do well.

And you foc– you do things that contribute to the things that you do well, and you stay away from the stuff that, that doesn’t help you do well. And I think that’s what has allowed that firm to be, you know, as successful as it is with its advisors and then really importantly with its, uh, private equity investors.

I mean, the returns that Kestra has generated for its private equity investors and the senior management that are there are just amazing. So, um, I think they’re doing really, really well. Um, I think, uh, to get to the AI thing, I think Mark Gilbert and the team at Zocks are doing really great forward-thinking work on how you take this technology and, as you said, in a safe way, apply it to create value for advisors and their [00:22:00] clients.

Um, what, what they do with that software around note-taking and then extending it into other areas, I think is really gonna have a profound impact on, on the industry, uh, and look forward to following that. Um- You know, the other team that I think are doing great stuff is, uh, we all know alternatives, right, are growing in importance in clients’ portfolios, and I think the iCapital team, um, Lawrence Calcano is the leader there, um, they are doing great things to make it simpler for financial advisors to implement alts in cl- appropriately in client portfolios.

Um, again, coming at it from a technology angle, um, but really understanding the advice delivery process. I think may- they’ve done a good, good, good job there. Mm-hmm. I think the Mercer team’s doing good stuff on really building a scale national RIA, um, in, in, in a thoughtful way. I [00:23:00] mean, there’s so much activity going on in the RIA aggregator space, multiple different models out there.

Um, but, but they’re doing a, a great job, I think, uh, as well.

[00:23:11] Chip Kispert: That is wonderful. I love that, that feedback.

[00:23:14] Stephen Langlois: Yeah.

[00:23:16] Chip Kispert: So as we close, we always like to give you, um, the 1% better flash time, ninety seconds, unscripted. You can talk about anything you want in that time.

[00:23:31] Stephen Langlois: One of the things that I think is really important is really recognizing and valuing the fact that what makes a difference in this indry- industry is the people.

And it’s a small industry with great people. Um, and it’s a lot about relationships, you know? I mean, Chip, it’s like how you and I reconnected, right? Absolutely. Having first met [00:24:00] in, in Mayflower Hill in Waterville, Maine, and then we came back for a very memorable evening up in Sonoma that might have involved a fair amount of red liquid.

Um, but anyway.

[00:24:12] Chip Kispert: That would be true. And it

[00:24:14] Stephen Langlois: wasn’t blood. Um, you know, it’s the people that like don’t– T-spend– Take the time to understand what motivates people and what- H-how they make decisions. Uh, if I think about the most enjoyable part of my lo- as you said, long career, it’s been the people.

[00:24:40] Chip Kispert: I did

[00:24:40] Stephen Langlois: not.

Um, okay, that was R- that was RJ. That was RJ, sorry. Um, the, um, i-it is the people, and one of the things I love now, and I’ve tried through my whole career to make connections with people, to learn about them, to ask about, uh, genuinely ask and be interested in not just their work, but their [00:25:00] life. Um, and one of the things I feel really privileged about at this stage in my life is just having more time to reconnect with people, um, and, and learn about all of them, no matter what their station is.

‘Cause, ’cause that’s what, what makes the world go around for me. Um, and I think about, um, particularly as you become more senior and a little more experienced of trying to set an example for the people, um, who are, you know, younger than you, uh, in an organization and in a business. And, and that’s, that’s the thing, I just don’t think you can replace.

It’s, it’s what makes doing this stuff really fun.

[00:25:40] Chip Kispert: One hundred percent agree with you. I love that.

[00:25:42] Stephen Langlois: I d- that was not, it’s not a profound thought, but, like, don’t forget the people. Don’t forget the people.

[00:25:48] Chip Kispert: Well, Steven, we’ve loved having you on the show. Um, and I can’t thank you enough for taking the time with us.

Well, thank you. It’s been a privilege to be here. Thank you so much for [00:26:00] thinking of me. Love chatting with him. He always brings new ideas to my mind.

[00:26:06] RJ Malyk: It was, uh, fun listening to you two talk, knowing that, uh, you have, uh, quite a history. So it was enjoyable to sit back and, uh, just, uh, hear you two discuss what’s going on.

Uh, it was interesting, he– ev- in the very beginning, he compared advisors, financial advisors, uh, to the doctors and nurses. He called them the doctors and nurses of the financial world. And, you know, when I heard that, I was like, “Wow, that’s, that’s an interesting take.” And then you think about it, it’s like, well, yeah, y-you-you’re taking care of our finances and, and, you know, you’re– if there’s something wrong, you’re giving us solutions.

So in a way, that, that was a good comparison. And the other thing I enjoyed listening to you discuss was the challenges that your industry is facing with AI and the fact that you’re– there’s a lack of financial advisors coming [00:27:00] up through the pipeline. I, I thought that was, uh… And that seems to be a theme- Or I shouldn’t say a theme, but I’ve heard that discussion on those topics more than once on your podcast.

[00:27:12] Chip Kispert: That is true. Um, there’s, uh, a great need for young advisors to come up into the business. Um, you know, as… And it’s funny ’cause I, you know I like to draw a couple takeaways from our conversations. One thing that really kind of stuck with me was his comment about good advisors help clients in practical ways and do what’s best for the client.

Um, and I thought that was pretty profound as we get, we focus on all these, you know, whether investments or, you know, how do you service, and I just thought that was a pretty basic statement that really rang true. Um, next, um, you know, [00:28:00] his comment that investor customers are predominantly goal-based these days versus investment return, um, I, I really found that interesting, where focus is on goals, um, tax optimization, and long-term planning and, and being able to match up against those goals.

And then the last thing I took away, um, we circled back to it at the end, but was, talked about succession. Advisors need to plan for the future. Um, and, you know, areas, you know, in figuring out how to take their businesses and basically be able to give them to the next or hand them to the next generation, and then AI’s gonna just kind of change kind of the way advisors work, I think.

But, uh, you know, I thought it was a fabulous conversation. Um, and [00:29:00] as I get ready to do my normal, uh, to everyone listening, Ted Lasso said it best: “Be curious, not judgmental.” Stay curious about the people around you, the firms doing things differently, and the work in front of you. That’s how you get 1% better every day.

[00:29:17] RJ Malyk: Thanks, Chip. And we need to add in a shout-out, as this podcast is brought to you by Beacon Strategies LLC, the go-to resource for round tables, consulting, and services that support wealth management firms and their providers. If you need some industry perspective or help, please visit beaconstrategiesllc.com.

And again, thank you for listening to the Beacon 1% Better podcast. We ask you to share this podcast, rate it, and leave a review because this actually helps others find the podcast. Again, thank you for listening and for Chip Kispurt and everyone at Beacon Strategies. I’m RJ Malyk, and we look forward to you joining us for our next podcast.

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