There’s a band of aggregators who believe they offer something different to the larger operators. MPA catches up with some of the key challengers in this market for their thoughts on the state of aggregation, industry consolidation and what they can offer to the broking community
There’s a band of aggregators who believe they offer something different to the larger operators. MPA catches up with some of the key challengers in this market for their thoughts on the state of aggregation, industry consolidation and what they can offer to the broking community
There’s no doubt that the large, established aggregators are performing a valuable service for mortgage brokers. They have the size, scale and service proposition to match. Plus, with several of the larger players having been acquired in part or in whole by banks who are hungry to take a slice of the distribution pie, the resources on offer to these aggregators are increasing.
But speak to representatives of Australia’s band of challenger and boutique aggregators and the message coming from these quarters is loud and clear: competition in the aggregation industry is not dead, and the challengers in this market are providing compelling and innovative solutions to brokers who are interested in looking beyond the big boys.
MPA caught up with representatives from several challenger aggregators to get their take on the state of the market – and present their case for the challenger proposition.
What do challenger aggregators offer in points of difference from the larger operators?
Tanya Sale
One word springs to mind – and that is ‘independence’. Boutique aggregators have the ability to quickly respond to industry change, and realise opportunities. Members have accessibility to senior staff, more personal relationships, and more resources per quota. We can, and do, work to manage things swiftly.
Gerald Foley
We all see value in dealing with any business that has a boutique or ‘smaller’ feel. The issue then becomes, do I need to pay more to receive the boutique service? With nMB it is the best of both worlds. We have built a strong reputation for consistency in service and for being the home to many quality and successful brokers. Now being part of a larger, stronger group through our Aussie (and ultimately CBA) ownership adds another dimension to our value proposition.
Brendan O’Donnell
We’ve got these large aggregators just looking to build scale, and because of that they tend to lose sight of what brokers ultimately want. Whereas you’ve got emerging, new, challenger or boutique players out there who recognise what they’re looking for. And if they’ve got a differentiator in their proposition, they tend to do exceptionally well.
What do you think of major banks buying into aggregation?
Brendan O’Donnell
Almost one in two Australians use a broker. The banks can’t ignore this and therefore need to look at strategic ways in which to benefit from broker success. By owning or having a significant share in any particular aggregator, they are able to influence outcomes to benefit their ROI and equally own market share.
Tanya Sale
I have never been a big supporter of this for the sole reason that the mortgage broking industry was created by people who were attempting to lead the way into a landscape that was competitive, fair and gave the consumer a choice – thereby aggregation was born. When the lenders say, “Oh we do not interfere”, if someone is paying millions for a slice of or the whole of an aggregation group do you honestly believe they would not have a big role in the way that business is run?
Gerald Foley
Banks buying into aggregators is a clear validation that the broker channel is here to stay. Aggregator ownership doesn’t influence where a broker directs their clients’ business. It just provides greater comfort that, as the broker’s business grows, their loan book and the trail commission that it generates is more secure.
Frank Paratore
They’re seeing aggregation as a viable channel. And what it’s also doing for them, rightly or wrongly, is shoring up distribution. We get approaches [from buyers]. But we’re running our own independent race. We’re not interested in selling. If anything, we’re looking to make sure that we go the other way to make sure that there are some independents that remain in the market as independents.
How do you see challenger aggregators evolving over the next year?
Frank Paratore
I don’t know that we need to do anything really significantly different. From an evolving perspective I’d be turning around and saying that we are probably the most evolved aggregator in the marketplace – call it boutique or major.
Brendan O’Donnell
Some may merge/join larger aggregator groups, while others that are able to invest in their business will continue to carve out a healthy network and be successful. Key to success is the ability to be able to invest in technology, effective processes and effective marketing. Boutique offerings are in many cases more attractive and competitive, and are able to harness the benefits of belonging to a small yet effective network of like-minded individuals.
Peter Andronicos
A lot of the challenger brands are starting to move towards a franchise model, and they’re trying to evolve into a brand. In an effort to minimise broker losses, they’ll provide more and more services to retain that business. The issues with that, though, are that not everyone can be a good marketer, not everyone can drive leads, not everyone can provide the tools and systems that a broker wants as part of a franchise offering.
Tanya Sale
We will see those who have strong models go from strength to strength, with more lending professionals looking for a true independent offering – then they will look no further than the boutique!
Gerald Foley
The challenges being faced by boutiques are similar to larger aggregators. It is all about getting more productive brokers on board at a sustainable commission-sharing model. Boutique aggregators are more often available to get a closer understanding of their brokers’ businesses and provide tailored business support.
What are the key challenges that challenger aggregators face?
Peter Andronicos
Probably the biggest one’s going to be margin, and then profit. It seems aggregators are chasing volume and then hoping that the profit will follow somehow – or hoping that by chasing volume they’ll be able to start flogging other services to the brokers, like marketing campaigns and lead buying.
Gerald Foley
There are pressures building on all aggregators to provide a broader range of services to their broker business partners. If there are any pressures on the larger aggregators then maybe these are more widely obvious to the marketplace. The true impact on the challenger brands is hard to see from the outside. I sense some smaller aggregators are struggling to hold on under increasing pressures to broaden services, increase payout rates and maintain lender relevance.
Tanya Sale
Opportunities will come and the challenge will be how that aggregator can deal with the challenge of it – ie resources, systems, processes – ensuring that they keep to the mantra that got people to join them. The challenge will be not to lose focus on their initial strategy that made them successful; focus will be the key component.
Frank Paratore
Consolidation is still going to be a challenge or a threat, but an opportunity for us to certainly still grow because of the way that our model is predicated. We don’t have a ‘bums on seats’ type mentality. Ours is more of a structured approach with regard to who actually fits our model, who makes sense to our model, and who can we work with to help them grow their business.
Brendan O’Donnell
One of the key challenges is having the ongoing capital to be able to invest and grow the business. Building a broking business is not a short-term initiative; it takes time, focus, patience and a sound value proposition to succeed. As larger groups focus more on scale, volume and top-performing brokers, they often lose sight of the average broker writing $1m per month. These brokers are part of the reason the industry is where it is today.
What type of broker is suited to challenger aggregators?
Frank Paratore
Certainly the more experienced broker – somebody looking at integration for their business model; somebody looking at growth of their own model. And certainly someone that’s relationship focused, not transaction focused.
Tanya Sale
Complete professionals who have adapted to the new landscape and are taking the role as mortgage professional to another level.
Gerald Foley
A boutique aggregation model, such as nMB, suits the person looking to build a full mortgage broking business and sees value in their aggregator’s systems, support and strength. What type of broker is suited to challenger aggregators?
Brendan O’Donnell
As larger groups focus more on scale, volume and top-performing brokers, they often lose sight of the average broker writing $1m per month. They are the ones that require the support and high touch in order for them to increase their performance and also sustain their business for a longer period. Boutique aggregators are well positioned to provide this.
Peter Andronicos
For eChoice it’s about the broker who wants to be settling $3m–$5m per month. It’s a broker that wants help in becoming their own franchise, or in their own brand, or part of eChoice. And they need tools, mentoring and support that they don’t currently have. It’s brokers looking for assistance and support to grow beyond the norm.
What do challenger aggregators need to do to remain viable?
Gerald Foley
All businesses, irrespective of size, to remain viable have to be able to show that they can offer a strong business proposition at competitive remuneration levels – including receipts from lenders and payout rates – whilst being able to reinvest in and grow their business.
Brendan O’Donnell
There is a new emerging model – a hybrid between aggregation and retail branded model – where you get the best of both worlds, ie where the economics are as good as what an aggregator offers, but so is the support you would get in a branded franchise model. This is what LNS offers.
Tanya Sale
It doesn’t matter if you are boutique or large; it will come down to the model: how it is managed, focusing on your core business. I often use the analogy of ‘sticking to your knitting’ – looking at your overall business and making decisions that are going to be viable. Don’t fall in the trap of watching what your competitor is doing – if you do this you will lose focus on what your own goals are. And remain independent!
Peter Andronicos
You’ve got to price it right. Not everyone can offer 100/100 [commission split]. If you want 100/100 then expect a level of service, support and quality that comes with that. We’re a business that’s about building and supporting, helping you become a success and actually putting in place a path to help you get there.
Frank Paratore
The banks operate on a situation of multiple services or products per customer type mentality – we’re no different in approach. I do believe that we need to have independence in the marketplace in order to provide a true broker proposition which leads to real impartiality where there’s no structured bank ownership. Everyone’s fighting for business at this point in time, and it’s coming down to who’s going to provide the cheapest aggregation fee. For me, we don’t play the cheapest aggregation space; it’s more about what our value proposition is.
#pb#
IN FOCUS: OUTSOURCE FINANCIAL
Tanya Sale
CEO, Outsource Financial
MPA: What are your strengths?
Tanya Sale: Outsource has always positioned itself in acting as a true business partner to all of its members. We find we are able to also achieve more because we actually have a relationship with every one of our members and know what they want, thereby being able to go out and create tools/processes/systems to meet their needs. Outsource is very robust in lead generation from our referral sector. We are so strong in this area we have been able to help loan writers that are good at what they do but don’t necessarily have the business savvy to grow and prosper.
MPA: What type of broker would you encourage to join your ranks?
TS: This is twofold with Outsource Financial: as we have a large number of financial planners/accountants who are adding lending to their core business and are wanting to do this in-house, we find we have a lot of new entrants in this space – thereby we have had to create and build a mentoring program to cater for the ‘newbies’. This has been a huge success as we do not charge for it and we have the relevant people who work with them ongoing. The other type of brokers are quality individuals/groups that are serious about lending as a profession, and want to work with us in assisting them in building a multifaceted business.
MPA: What are your plans for the year ahead?
TS: We will keep on doing what we do best and focus on strategies that have been put in place for the next 12 months. Outsource continues to grow, and we will ensure that growth will include a greater focus on training and education for our members and writers to assist them in their growth and strategy patterns. Growth, whilst it will also be in numbers, will not be the sole indicator but also a facility to what we provide our members and writers.
IN FOCUS: nMB
Gerald Foley
Managing director, nMB
MPA: What are your strengths?
Gerald Foley: For over a decade, nMB has provided mortgage brokers all the help they need to succeed and excel. Our basic proposition is that we are singularly focused on providing aggregator services to mortgage professionals who want to build a solid mortgage broking business and understand the value in dealing with a strong, focused business partner.
MPA: What type of broker would you encourage to join your ranks?
GF: Whilst able to support individual brokers, the nMB business model best suits the person looking to build a full mortgage broking business – with multiple loan writers, support staff and referrers – and sees value in their aggregator’s systems, support and strength.
MPA: What are your plans for the year ahead?
GF: To continue our growth trajectory whilst maintaining the high level of business support to our brokers.
MPA: How do you support brokers to grow their business?
GF: nMB is always responsive to our brokers’ needs and requirements. All senior management are available to assist with whatever is required: whether it’s some strategic planning, goal setting, helping design a marketing plan or even just creating a Facebook page. Through access to a number of suppliers, we are able to offer our brokers affordable websites to assist in the marketing of their business. We also have an iPhone app that can be branded to the broker’s business needs. Along with the nMB software, this is constantly evolving to meet our brokers’ needs.
IN FOCUS: BALLAST
Frank Paratore
CEO, Ballast
MPA: What are your strengths as an aggregator?
Frank Paratore: Full integration of services – we understand that. We actually partner with our members to grow their business, which means that we know what it’s like to talk about income and spreading risk, because we’ve done it ourselves.
We’re helping our members build their own revenue streams. We’reviewing their business in the same way we’d view our business. And what we’re starting to do is work more with business owners.
The more integrated a financial services offering, the stickier your customer is. A lot of the market is still transactional focused. They haven’t cottoned on to the integration of financial services, which would drive a higher multiple for their business. They’re still seeing themselves as a transactional broker; they’re still not valuing what their true business proposition is.
We want to work with individuals and deliver better quality and more services to them. And what they’re going to get is a bigger multiple when they eventually sell their business.
MPA: What are your plans for the year ahead?
FP: We’re going to continue to go down our path and consolidate our model. There are still plans for us to look at acquiring for the right sort of options. But certainly there’s no intention to sell. We want to encourage more independents into the market and continue our growth.
MPA: Are a lot of your brokers looking at following an integrated model?
FP: They are, because we’re making it easy for them. It’s not a situation where everyone has to be a master of all. We offer a structure where people can either refer via our customer-connect lead management platform – and then one of our in-house people will take care of it for them – or they can build it into their own business model.
IN FOCUS: LIBERTY NETWORK SERVICES
Brendan O’Donnell
Managing director, Liberty Network Services
MPA: What are your strengths as an aggregator?
Brendan O’Donnell: We have five key strengths where we differentiate against what the market offers:
Technology
We won the innovation of the year award at the end of the year due to our technology platform, Spark. There’s no one else yet that I know of that do what we do. You can run your entire broking business off the iPad – it’s an end-to-end system.
Marketing
We have a very strong central team which drives a lot of digital marketing for advisers at a local level. We do a lot of local branding that’s localised, as opposed to national. So we really do deliver on that.
Diversification
Our advisers obviously offer traditional residential mortgages, but beyond that we have a very strong motor proposition. On the commercial side, our advisers have progressed into SME business. They’ve also progressed into SMSF business. And then through the course of next year we’re looking to launch our insurance range of products.
Support
When you’re smaller you can have high touch. It’s important for our advisers to succeed, because if they don’t we don’t. Because we’ve got less people, we tend to make sure that everyone’s going to be successful.
Economics
If you’re part of a franchise business or branded business, they take a significant proportion of your commission, and they claim to then put that back into marketing your business. So you’ve got to write two or three times as much as you would anywhere else. We wanted to avoid that. Equally we recognised that aggregators offer very sharp pricing at the other end. I’ve got no doubt our economics is the sharpest in the market when it comes to a branded proposition.
IN FOCUS: eCHOICE
Peter Andronicos
General manager, eChoice
MPA: What are your strengths as an aggregator?
Peter Andronicos: Our strengths are in our service, our support and the flexibility in our business model. If you’re having a slow month, you can turn on leads for a month, take 20 appointments, show us that you can convert those appointments, and then we’ll help you work those appointments into building a self-generation business.
MPA: Which type of broker would you encourage to join your ranks?
PA: eChoice looks for the broker that wants to take their business to the next level. If you want to settle $4m-plus per month, we’ll get you there. On top of that, we’re looking for graduates that want to break into the industry and need quality mentoring, support and training – as well as a guaranteed path where brokers are given leads and appointments, and how to leverage those into self-generation where they get higher commissions.
MPA: What are your plans for the year ahead?
PA: We want to push hard into the market as a quality aggregation and direct-to-consumer brand. We are aggressively recruiting new brokers now who are looking for a career or assistance to grow. We really want to be positioning eChoice as the modern brand for the modern broker, servicing a modern market.
MPA: How do you support brokers to grow their business?
PA: We provide constant mentoring and support. We provide marketing and retention tools that are plug and play – branded as eChoice, or white labelled as their own brand, or a hybrid of both. We also do quarterly product development days. And very intense one-on-one training on self-generation, conversion and best practices. Those sessions are held and managed by existing and recent brokers – and those brokers were settling $4m–$6m a month each themselves.
There’s no doubt that the large, established aggregators are performing a valuable service for mortgage brokers. They have the size, scale and service proposition to match. Plus, with several of the larger players having been acquired in part or in whole by banks who are hungry to take a slice of the distribution pie, the resources on offer to these aggregators are increasing.
But speak to representatives of Australia’s band of challenger and boutique aggregators and the message coming from these quarters is loud and clear: competition in the aggregation industry is not dead, and the challengers in this market are providing compelling and innovative solutions to brokers who are interested in looking beyond the big boys.
MPA caught up with representatives from several challenger aggregators to get their take on the state of the market – and present their case for the challenger proposition.
What do challenger aggregators offer in points of difference from the larger operators?
Tanya SaleOne word springs to mind – and that is ‘independence’. Boutique aggregators have the ability to quickly respond to industry change, and realise opportunities. Members have accessibility to senior staff, more personal relationships, and more resources per quota. We can, and do, work to manage things swiftly.
Gerald FoleyWe all see value in dealing with any business that has a boutique or ‘smaller’ feel. The issue then becomes, do I need to pay more to receive the boutique service? With nMB it is the best of both worlds. We have built a strong reputation for consistency in service and for being the home to many quality and successful brokers. Now being part of a larger, stronger group through our Aussie (and ultimately CBA) ownership adds another dimension to our value proposition.
Frank Paratore
We provide a structured service and business advice-type model, which is more interactive where we work quite closely with a lot of our members. We’re very much relationship focused, not transaction focused.Brendan O’Donnell We’ve got these large aggregators just looking to build scale, and because of that they tend to lose sight of what brokers ultimately want. Whereas you’ve got emerging, new, challenger or boutique players out there who recognise what they’re looking for. And if they’ve got a differentiator in their proposition, they tend to do exceptionally well.
Peter Andronicos
Not everyone can compete on price, and our business model is not a price model. Challenger brands need to focus on boutique services and boutique support propositions. The bigger you get, the less margin is made and the more people are required to support those networks. So I think one of the other big things is being treated as a business, and as a broker, not as a number and a settlement volume.What do you think of major banks buying into aggregation?
Brendan O’Donnell
Almost one in two Australians use a broker. The banks can’t ignore this and therefore need to look at strategic ways in which to benefit from broker success. By owning or having a significant share in any particular aggregator, they are able to influence outcomes to benefit their ROI and equally own market share.
Tanya Sale
I have never been a big supporter of this for the sole reason that the mortgage broking industry was created by people who were attempting to lead the way into a landscape that was competitive, fair and gave the consumer a choice – thereby aggregation was born. When the lenders say, “Oh we do not interfere”, if someone is paying millions for a slice of or the whole of an aggregation group do you honestly believe they would not have a big role in the way that business is run?
Gerald Foley
Banks buying into aggregators is a clear validation that the broker channel is here to stay. Aggregator ownership doesn’t influence where a broker directs their clients’ business. It just provides greater comfort that, as the broker’s business grows, their loan book and the trail commission that it generates is more secure.
Frank Paratore
They’re seeing aggregation as a viable channel. And what it’s also doing for them, rightly or wrongly, is shoring up distribution. We get approaches [from buyers]. But we’re running our own independent race. We’re not interested in selling. If anything, we’re looking to make sure that we go the other way to make sure that there are some independents that remain in the market as independents.
Peter Andronicos
I think it’s fantastic because the banks see value in the aggregators, and they’re now starting to see the fact that the aggregator can offer distribution and product sales. I think it’s becoming increasingly competitive, and we have probably two to four lenders a week that come to us and push us for more volume. At the end of the day, eChoice is trying to maintain an agnostic approach when it comes to lenders. It’s about what’s right for the consumer.How do you see challenger aggregators evolving over the next year?
Frank Paratore
I don’t know that we need to do anything really significantly different. From an evolving perspective I’d be turning around and saying that we are probably the most evolved aggregator in the marketplace – call it boutique or major.
Brendan O’Donnell
Some may merge/join larger aggregator groups, while others that are able to invest in their business will continue to carve out a healthy network and be successful. Key to success is the ability to be able to invest in technology, effective processes and effective marketing. Boutique offerings are in many cases more attractive and competitive, and are able to harness the benefits of belonging to a small yet effective network of like-minded individuals.
Peter Andronicos
A lot of the challenger brands are starting to move towards a franchise model, and they’re trying to evolve into a brand. In an effort to minimise broker losses, they’ll provide more and more services to retain that business. The issues with that, though, are that not everyone can be a good marketer, not everyone can drive leads, not everyone can provide the tools and systems that a broker wants as part of a franchise offering.
Tanya Sale
We will see those who have strong models go from strength to strength, with more lending professionals looking for a true independent offering – then they will look no further than the boutique!
Gerald Foley
The challenges being faced by boutiques are similar to larger aggregators. It is all about getting more productive brokers on board at a sustainable commission-sharing model. Boutique aggregators are more often available to get a closer understanding of their brokers’ businesses and provide tailored business support.
What are the key challenges that challenger aggregators face?
Peter Andronicos
Probably the biggest one’s going to be margin, and then profit. It seems aggregators are chasing volume and then hoping that the profit will follow somehow – or hoping that by chasing volume they’ll be able to start flogging other services to the brokers, like marketing campaigns and lead buying.
Gerald Foley
There are pressures building on all aggregators to provide a broader range of services to their broker business partners. If there are any pressures on the larger aggregators then maybe these are more widely obvious to the marketplace. The true impact on the challenger brands is hard to see from the outside. I sense some smaller aggregators are struggling to hold on under increasing pressures to broaden services, increase payout rates and maintain lender relevance.
Tanya Sale
Opportunities will come and the challenge will be how that aggregator can deal with the challenge of it – ie resources, systems, processes – ensuring that they keep to the mantra that got people to join them. The challenge will be not to lose focus on their initial strategy that made them successful; focus will be the key component.
Frank Paratore
Consolidation is still going to be a challenge or a threat, but an opportunity for us to certainly still grow because of the way that our model is predicated. We don’t have a ‘bums on seats’ type mentality. Ours is more of a structured approach with regard to who actually fits our model, who makes sense to our model, and who can we work with to help them grow their business.
Brendan O’Donnell
One of the key challenges is having the ongoing capital to be able to invest and grow the business. Building a broking business is not a short-term initiative; it takes time, focus, patience and a sound value proposition to succeed. As larger groups focus more on scale, volume and top-performing brokers, they often lose sight of the average broker writing $1m per month. These brokers are part of the reason the industry is where it is today.
What type of broker is suited to challenger aggregators?
Frank Paratore
Certainly the more experienced broker – somebody looking at integration for their business model; somebody looking at growth of their own model. And certainly someone that’s relationship focused, not transaction focused.
Tanya Sale
Complete professionals who have adapted to the new landscape and are taking the role as mortgage professional to another level.
Gerald Foley
A boutique aggregation model, such as nMB, suits the person looking to build a full mortgage broking business and sees value in their aggregator’s systems, support and strength. What type of broker is suited to challenger aggregators?
Brendan O’Donnell
As larger groups focus more on scale, volume and top-performing brokers, they often lose sight of the average broker writing $1m per month. They are the ones that require the support and high touch in order for them to increase their performance and also sustain their business for a longer period. Boutique aggregators are well positioned to provide this.
Peter Andronicos
For eChoice it’s about the broker who wants to be settling $3m–$5m per month. It’s a broker that wants help in becoming their own franchise, or in their own brand, or part of eChoice. And they need tools, mentoring and support that they don’t currently have. It’s brokers looking for assistance and support to grow beyond the norm.
What do challenger aggregators need to do to remain viable?
Gerald Foley
All businesses, irrespective of size, to remain viable have to be able to show that they can offer a strong business proposition at competitive remuneration levels – including receipts from lenders and payout rates – whilst being able to reinvest in and grow their business.
Brendan O’Donnell
There is a new emerging model – a hybrid between aggregation and retail branded model – where you get the best of both worlds, ie where the economics are as good as what an aggregator offers, but so is the support you would get in a branded franchise model. This is what LNS offers.
Tanya Sale
It doesn’t matter if you are boutique or large; it will come down to the model: how it is managed, focusing on your core business. I often use the analogy of ‘sticking to your knitting’ – looking at your overall business and making decisions that are going to be viable. Don’t fall in the trap of watching what your competitor is doing – if you do this you will lose focus on what your own goals are. And remain independent!
Peter Andronicos
You’ve got to price it right. Not everyone can offer 100/100 [commission split]. If you want 100/100 then expect a level of service, support and quality that comes with that. We’re a business that’s about building and supporting, helping you become a success and actually putting in place a path to help you get there.
Frank Paratore
The banks operate on a situation of multiple services or products per customer type mentality – we’re no different in approach. I do believe that we need to have independence in the marketplace in order to provide a true broker proposition which leads to real impartiality where there’s no structured bank ownership. Everyone’s fighting for business at this point in time, and it’s coming down to who’s going to provide the cheapest aggregation fee. For me, we don’t play the cheapest aggregation space; it’s more about what our value proposition is.
#pb#
IN FOCUS: OUTSOURCE FINANCIAL
Tanya SaleCEO, Outsource Financial
MPA: What are your strengths?
Tanya Sale: Outsource has always positioned itself in acting as a true business partner to all of its members. We find we are able to also achieve more because we actually have a relationship with every one of our members and know what they want, thereby being able to go out and create tools/processes/systems to meet their needs. Outsource is very robust in lead generation from our referral sector. We are so strong in this area we have been able to help loan writers that are good at what they do but don’t necessarily have the business savvy to grow and prosper.
MPA: What type of broker would you encourage to join your ranks?
TS: This is twofold with Outsource Financial: as we have a large number of financial planners/accountants who are adding lending to their core business and are wanting to do this in-house, we find we have a lot of new entrants in this space – thereby we have had to create and build a mentoring program to cater for the ‘newbies’. This has been a huge success as we do not charge for it and we have the relevant people who work with them ongoing. The other type of brokers are quality individuals/groups that are serious about lending as a profession, and want to work with us in assisting them in building a multifaceted business.
MPA: What are your plans for the year ahead?
TS: We will keep on doing what we do best and focus on strategies that have been put in place for the next 12 months. Outsource continues to grow, and we will ensure that growth will include a greater focus on training and education for our members and writers to assist them in their growth and strategy patterns. Growth, whilst it will also be in numbers, will not be the sole indicator but also a facility to what we provide our members and writers.
IN FOCUS: nMB
Gerald FoleyManaging director, nMB
MPA: What are your strengths?
Gerald Foley: For over a decade, nMB has provided mortgage brokers all the help they need to succeed and excel. Our basic proposition is that we are singularly focused on providing aggregator services to mortgage professionals who want to build a solid mortgage broking business and understand the value in dealing with a strong, focused business partner.
MPA: What type of broker would you encourage to join your ranks?
GF: Whilst able to support individual brokers, the nMB business model best suits the person looking to build a full mortgage broking business – with multiple loan writers, support staff and referrers – and sees value in their aggregator’s systems, support and strength.
MPA: What are your plans for the year ahead?
GF: To continue our growth trajectory whilst maintaining the high level of business support to our brokers.
MPA: How do you support brokers to grow their business?
GF: nMB is always responsive to our brokers’ needs and requirements. All senior management are available to assist with whatever is required: whether it’s some strategic planning, goal setting, helping design a marketing plan or even just creating a Facebook page. Through access to a number of suppliers, we are able to offer our brokers affordable websites to assist in the marketing of their business. We also have an iPhone app that can be branded to the broker’s business needs. Along with the nMB software, this is constantly evolving to meet our brokers’ needs.
IN FOCUS: BALLAST
Frank ParatoreCEO, Ballast
MPA: What are your strengths as an aggregator?
Frank Paratore: Full integration of services – we understand that. We actually partner with our members to grow their business, which means that we know what it’s like to talk about income and spreading risk, because we’ve done it ourselves.
We’re helping our members build their own revenue streams. We’reviewing their business in the same way we’d view our business. And what we’re starting to do is work more with business owners.
The more integrated a financial services offering, the stickier your customer is. A lot of the market is still transactional focused. They haven’t cottoned on to the integration of financial services, which would drive a higher multiple for their business. They’re still seeing themselves as a transactional broker; they’re still not valuing what their true business proposition is.
We want to work with individuals and deliver better quality and more services to them. And what they’re going to get is a bigger multiple when they eventually sell their business.
MPA: What are your plans for the year ahead?
FP: We’re going to continue to go down our path and consolidate our model. There are still plans for us to look at acquiring for the right sort of options. But certainly there’s no intention to sell. We want to encourage more independents into the market and continue our growth.
MPA: Are a lot of your brokers looking at following an integrated model?
FP: They are, because we’re making it easy for them. It’s not a situation where everyone has to be a master of all. We offer a structure where people can either refer via our customer-connect lead management platform – and then one of our in-house people will take care of it for them – or they can build it into their own business model.
IN FOCUS: LIBERTY NETWORK SERVICES
Brendan O’DonnellManaging director, Liberty Network Services
MPA: What are your strengths as an aggregator?
Brendan O’Donnell: We have five key strengths where we differentiate against what the market offers:
Technology
We won the innovation of the year award at the end of the year due to our technology platform, Spark. There’s no one else yet that I know of that do what we do. You can run your entire broking business off the iPad – it’s an end-to-end system.
Marketing
We have a very strong central team which drives a lot of digital marketing for advisers at a local level. We do a lot of local branding that’s localised, as opposed to national. So we really do deliver on that.
Diversification
Our advisers obviously offer traditional residential mortgages, but beyond that we have a very strong motor proposition. On the commercial side, our advisers have progressed into SME business. They’ve also progressed into SMSF business. And then through the course of next year we’re looking to launch our insurance range of products.
Support
When you’re smaller you can have high touch. It’s important for our advisers to succeed, because if they don’t we don’t. Because we’ve got less people, we tend to make sure that everyone’s going to be successful.
Economics
If you’re part of a franchise business or branded business, they take a significant proportion of your commission, and they claim to then put that back into marketing your business. So you’ve got to write two or three times as much as you would anywhere else. We wanted to avoid that. Equally we recognised that aggregators offer very sharp pricing at the other end. I’ve got no doubt our economics is the sharpest in the market when it comes to a branded proposition.
IN FOCUS: eCHOICE
Peter AndronicosGeneral manager, eChoice
MPA: What are your strengths as an aggregator?
Peter Andronicos: Our strengths are in our service, our support and the flexibility in our business model. If you’re having a slow month, you can turn on leads for a month, take 20 appointments, show us that you can convert those appointments, and then we’ll help you work those appointments into building a self-generation business.
MPA: Which type of broker would you encourage to join your ranks?
PA: eChoice looks for the broker that wants to take their business to the next level. If you want to settle $4m-plus per month, we’ll get you there. On top of that, we’re looking for graduates that want to break into the industry and need quality mentoring, support and training – as well as a guaranteed path where brokers are given leads and appointments, and how to leverage those into self-generation where they get higher commissions.
MPA: What are your plans for the year ahead?
PA: We want to push hard into the market as a quality aggregation and direct-to-consumer brand. We are aggressively recruiting new brokers now who are looking for a career or assistance to grow. We really want to be positioning eChoice as the modern brand for the modern broker, servicing a modern market.
MPA: How do you support brokers to grow their business?
PA: We provide constant mentoring and support. We provide marketing and retention tools that are plug and play – branded as eChoice, or white labelled as their own brand, or a hybrid of both. We also do quarterly product development days. And very intense one-on-one training on self-generation, conversion and best practices. Those sessions are held and managed by existing and recent brokers – and those brokers were settling $4m–$6m a month each themselves.
