Becoming a business owner rather than simply an adviser is one of the hardest lessons of setting up a practice, according to G Financial director Michael Grammatico.

“It is about adviser versus business owner and I had to come to terms with this concept,” he told the Association of Financial Advisers conference on the Gold Coast last week.

“I wanted the choice and freedom of running my own business. I wanted the flexibility but did I have the experience to run my own business? That was the hard decision.”

Mr Grammatico has worked in the corporate financial services industry for a number of years and observed how adviser practices function.

“I had to look at how to set up a practice, the costs, and would I work from home initially or rent an office?” he said.

“These were all big questions I had to face before starting. Another decision was whether to buy an existing practice or build a book.

“I did a lot of due diligence on client age, demographics, single or multiple policies when looking at books.”

Mr Grammatico says there was also the question of financing the book purchase and what value he could add.

“I wanted to add 50% value to a book I bought during a three-year period.”

He says a bought book can generate leads, which is the lifeblood of a practice.

Mr Grammatico also targets “centres of influence”, to generate business from family members, and sells himself as a specialist.

“There is nothing wrong with being a specialist – I am an insurance salesman,” he said.

“From the client perspective, I was providing independent advice. From the business perspective, I was delivering trust, transparency, excellence and respect.”

On the future of the business, he says “it is important to set targets and meet them. Now my future is making sure I have the right model to go ahead.”