Episode Thumbnail
Episode 3  |  24:14 min

John Wortman dives into the evolution of teams and leaders

Episode 3  |  24:14 min  |  08.20.2021

John Wortman dives into the evolution of teams and leaders

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This is a podcast episode titled, John Wortman dives into the evolution of teams and leaders. The summary for this episode is: <p>John Wortman, Co-Founder &amp; CEO of Valeo Financial Advisors makes his podcasting debut. John and Tim discuss growing a team, the evolution of a leader, and the importance of communication and being on the same page.</p>
Takeaway 1 | 01:08 MIN
Growing the team and taking off hats
Takeaway 2 | 01:11 MIN
Evolving as a leader
Takeaway 3 | 00:47 MIN
A team that continuously works to get better
Takeaway 4 | 01:07 MIN
Communicate and keep the end goal in mind
Takeaway 5 | 01:01 MIN
John's edge in life

John Wortman, Co-Founder & CEO of Valeo Financial Advisors makes his podcasting debut. John and Tim discuss growing a team, the evolution of a leader, and the importance of communication and being on the same page.

Guest Thumbnail
John Wortman
Co-Founder and CEO, Valeo Financial Advisors
John is the Co-Founder & CEO of Valeo Financial Advisors, a fee-only advisory firm that is ranked as one of the largest financial advisory firms in the Midwest. He has over 25 years of experience in the industry. Very active in the Indianapolis area, John has served on numerous nonprofit boards include Gleaners Food Bank, Lids Foundation, Second Presbyterian Church, and currently with Brackets For Good.
Connect with John

Tim Leman: Have you ever felt like you're on the edge of something great? You've put in the work, you've done the hard stuff most people aren't willing to do. And now you can just sense a magical run, lies ahead? This season, we'll talk to leaders across the wide variety of industries, to learn what it's like to ride the edge and own it. We'll hear what separates those special teams, from the more ordinary experiences. The kind, if we're lucky, we get to be a part of maybe three or four times in our life. Join me, Tim Leman, chairman and CEO of Gibson, as we discuss leading on the edge. Welcome to The Edge podcast. I'm your host, Tim Leman. On this episode, we have John Wortman. John is co- founder and CEO of Valeo Financial Advisors. John, I've had the pleasure of getting to know you and Valeo through YPO, over the years. And I'm excited to have you on as our guest. Welcome.

John Wortman: Yeah. Thanks Tim. Look forward to our conversation, excited to do it. I've never done one of these before, so looking forward to seeing what mistakes I might make.

Tim Leman: No, I doubt it. John Wortman's first podcast. Well then, this is really a special day for us. So tell our audience a little bit about Valeo, and your role there.

John Wortman: We are a comprehensive financial advisory firm. And so, we're unlike most in that we don't sell anything. So our job is to work like an attorney or an accountant would, delivering a fee for service, type of an approach. Where we're helping people, all of our clients, on a comprehensive basis. So insurance investments, tax, estate, we don't file people's tax returns. We don't draft their estate documents, but we coordinate that whole process. And so, it's easier to give good advice, we think, if you're doing it on a comprehensive basis. Because if you're making, say an investment recommendation without knowing someone's tax situation, it's hard to know what the impact might be. Same thing for making an investment, if you don't know how it should be titled, and owned in their estate plan. Or you can make all the investments in the world, but if you don't have your umbrella liability coverage in place, and something happens where one of your kids has an accident at school that they were responsible for, now you're suddenly getting sued, and those great investments you've made, get taken by someone else because you didn't have your coverages. So that comprehensive aspect, and a lot of people think that, that's harder to do than something like just investment advice. But we say financial advice is greater than investment advice. Investments are a part of that, but financial advice is really the whole picture, and you've got to be able to do that on a holistic basis.

Tim Leman: Yeah, and being familiar a little bit with your model there, estate planning, taxes, certainly the investments, even personal risk management, but what's maybe, one of the more unique stranger, odder requests that some of you guys have been involved with over the years, when you're helping clients? Something you might give some advice to them on.

John Wortman: I think that, we get asked to help people lose money from time to time. I'd say one of the most interesting ones, had a client send me an investment opportunity. And the people behind the investment opportunity, we knew for a fact were unscrupulous characters, for a host of reasons. And so, called back and said, hey, just wanted you to know that this is probably something we should stay completely clear off. And he said, oh, this is great. I said, what do you mean? He goes, well, I'll have them send you the paperwork to make the investment. I said, did you hear me? I said that this is without question, going to be something where your money will be gone very quickly. He says, no, this is great. He goes, my brother has been running his mouth for years about how great everything he touches is, and this is his idea. And if this is going to be one that I can lose 50 grand on, he'll shut up for the rest of my life. So give me the paperwork. And so, I'd say that was one of the more interesting ones where the dollars and cents of what you should do, don't match up with the psychology behind how certain people make financial decisions. So in that case, buying his brother's silence was worth 50 grand to him. And he genuinely made the investment, and he genuinely lost the money.

Tim Leman: Wow. And John, with this kind of a model too, and we've been talking a lot about teams and so on, this year. How do you staff for a model like this, internally, from a Valeo standpoint? In terms of all the people it takes to take care of a client. What does that look like? And how has that maybe, unique or different from other places?

John Wortman: Yeah. I think that we have a model where we're believed that we can build the next generation of advisors. And so, bringing people in, helping them with a skill set to the point where we're actually at the university level, trying to encourage certain curriculum, so that kids come out of school more able to help us. And then when they come out, we assign them to an entire client, they have their own clientele, whenever they first come to Valeo. And so, they're getting to sit in meetings right away and so forth. Now they're sitting in a secondary or tertiary capacity, so they're not the leading advisor and whatnot, but they at least get a chance to see the game played before their eyes. And it makes a whole lot more sense whenever they can see things being done that way. So, we'd like to say that essentially, it's grad school, but instead of paying, you get paid to go to grad school. And that work, a lot of the work is looking backwards, and getting things to where we are. And then as that progresses in their skill development, they start to then be able to look forward. And so, what the work is that they're doing for folks like myself that are advising clients is, they're helping make sure that we reconcile everything from the past, so we're ready to be able to look forward. So I don't have to spend my time looking backwards as to what happened and reconciling it, I can spend my time looking out the front dashboard, to make sure that we're giving the clients the best guidance that we can. And so, we're developing that next generation. And then we'll have certainly other advisors that join us from other firms. The career path at Valeo is so defined, that if someone's at another firm and they keep being told certain things are going to happen, and they just over a long enough period of time don't happen, then they can come and spend some time with Valeo, and see that all these different people along the way are all on that same career path and trajectory. One of the other things that's really important to us, is transparency. So from the day we started the firm, we put our fee schedule directly on our website. And looking at the statistical data, it is the most popular page on our website. So all those other firms who won't put it out there, they don't have the most popular pages that people are looking for. And not that these are the end all be all, but you got to be willing to tell people what you charge. Secondarily, internally, all of our advisors are compensated the same way. And so, I as the co- founder of the firm, I'm being compensated the exact same way as anyone else who's coming in. And so, if I can play the game and succeed by the rules and you're playing by those same rules, then we all have the chance to succeed. And I think that makes these younger advisors really willing to put in the time and effort, because they feel like the rules are fair, and they can see the success that those rules have generated for others. And they're willing to put their time and effort to that. So we have 35 year olds making less money than a 27 year old, and that's okay. Because there's different skillsets and levels, and everybody knows why that's the case, if that's the case. And we certainly have successful 35, and 45, and 55 year olds. But knowing that we're all playing by the same rules and being treated the same way, it makes them willing to work as hard as it takes to do that good work.

Tim Leman: So John, thinking about your role a little bit. Based on what you said there, it sounds like you still work with clients personally.

John Wortman: I do. I think that it's hard to lead the firm in a business like this, if you don't know how to do the work. And the work evolves over time. And so, the tax cuts, the jobs act at the end of 2017. I mean, if you don't understand what's going on in the tax law, I say, that's the good news for our younger advisors. The tax law completely changes every few years. And so, whatever someone knew in the'80s or'90s, those rules have changed several times, so you have a chance to catch up. And same thing with say opportunity zones. I mean, that came out of nowhere, and now suddenly you need to be an expert on it because if you don't understand, while it may only apply to certain unique situations, it's a huge opportunity that you could miss, and not be very good at the job yourself. So I look forward to the day, whenever we've got advisors that are all trained in all those different areas. That someone like me who's been around for a long time, can be interchangeable. But at least for now, I have to stay in that advisory game as we keep leading the firm forward.

Tim Leman: So John, with that and being in that CEO role, but also being active and in the game with clients. How are you all structured from a leadership team standpoint, so that you can keep driving the firm forward and take advantage of different skill sets and all that?

John Wortman: So looking back, we've gone from about 15 of us, to about 130 of us over the last 10 years. And so, at each step along the way, we keep taking hats off of financial advisors who are in those leadership chairs, and putting it on to full- time leadership, work chart type folks. So recently, we've brought in a full- time trainer, a full- time recruiter. Now we've got someone that's overseeing the advisor development programs we've met. These are not advisors, but they're taking over chairs that have genuinely been built by financial advisors. And so, the future of our industry, we think, you've got to have it crafted by people that know the industry itself. But ultimately, once they've got that documented, we've got to peel those hats off, for those specialists to be able to be full- time working on the business, as opposed to working in the business. So we're getting there. And we've got still, lots of financial advisors wearing lots of hats, that we need to peel off before that org chart gets built out. So ultimately, there's probably 30 or 40 people in leadership here at Valeo. Today, there are more like a dozen. Well, we've got to keep taking hats off financial advisors that are doing certain roles, and putting it on others.

Tim Leman: And bring in professional managers. So, I can relate to a lot of that in terms of our business model at Gibson. So I'm curious then as you make some of those decisions, how do you work with your partners to talk about having a professional manager in the long run is going to be a better deal, than in the short run? It's probably some margin erosion, when you bring on talented people.

John Wortman: It is. But I think a firm, as I mentioned earlier, that's as transparent as we are, also can look in the mirror and see realities. And success and growth cures a lot, what ails you. Because if you're trying to cling to something, but the firm around you is growing and succeeding at a level that was beyond your wildest dreams, it's okay to give some of those things up, because you felt like you've been a part of something special. And so, for me I would say, for the evolution of the firm, my job is that, I've got to keep getting better as a leader. Otherwise, the firm's success is going to overtake my ability to stay in that visionary chair. And so, that's the fun part about my role right now is that, I have to keep evolving. Because the same person that was leading the 15 person organization, isn't the same skill set it takes to lead 150, and then 1500, and things like that. So, I think there's enough success and growth occurring, that people realize when they're not great at things. Because you've got all these people who've been brought in from college, and have grown up now. And they're 30, 35 year olds that are really successful, that ask really good questions. And they want to make the firm better, because that's what we've instilled in them. And if you don't have the time, energy, effort, or capability to tackle those projects anymore that get us to the next level, you don't want to hold the organization back just so you can keep sitting in the chair that you've been in for a few years.

Tim Leman: Yeah. I appreciate that. I get where you're coming from and all that. So John, over the years, I think people learn a lot about teams. Maybe it's through team sports, some team sports, as I think about my kids being on a sport like track, or cross country. There's a collective team of scores added up together, but some individualistic performances in between. And then work teams and all that. But if I was going to ask you broadly overall about the best team you've ever been on, what would you say?

John Wortman: Yeah, the sports, the work side of things. I grew up playing sports every season there was to play, always. Keeps you out of trouble, keeps you active, learning sportsmanship, things like that. I guess in hindsight, I was blessed to never be on a great team. I was always on, and I was never on a terrible team. And I think that probably has impacted who I am, and where we've gone as a company. Because if you have enough success that you realize that you can play the game, but never so much success that you don't have to keep working to get better, then it keeps you driving forward. And so, probably the best team is the team I'm on now, here at Valeo, with the leadership team we have. But we sit around with all of our insecurities and the things that we've got to do better as an organization. And so, I think that, as I'm sitting here thinking, I'd say the best part of teamwork for me, is to have never been on such a bad team that you wanted to give up or didn't think you could compete. But never be so good that you were just winning, and didn't have to work at it. I had some good friends that were good, and played some high level athletics. And I think also growing up, speaking of sports, I grew up in Evansville. And at the time I was growing up, Don Mattingly, who had been drafted out of high school and was playing for the Yankees, was the American League MVP. And so as a kid who's growing up, I was probably 12 years old when Don was the MVP of the American League. He didn't get drafted by the Brewers, or the Royals. He got drafted by the Yankees. Who at the time, had George Steinbrenner, had Billy Martin, it had a lot of huge personalities on the grandest stage. And then at the same time, Calbert Cheney was a senior, whenever I was in high school playing basketball. And so, to see then Calvert Cheney turned into the all- time leading scorer, still to this day in Big Ten history. So it made it possible for me to believe that you can come from Evansville, Indiana, and you might just be the American League MVP, playing in New York city. Or you might become the greatest scorer in the history of the Big Ten, and that was possible. And so, I think that also played in from a team standpoint, to say, and those are both obviously team sports with individual accolades for them, but that factored in as I think about teams. Watching the success that those people had coming from a smaller place like I came from, to know that you can have success on a national, or bigger stage, is part of that as well.

Tim Leman: Yeah. I want to go back to something you said earlier too, in the role that you take with your clients. Oftentimes, you're putting together teams of experts for your clients. So you're in this coordinating, facilitating role. I can imagine a lot of these experts sometimes come with egos involved, part of being, maybe great at what they do, is they know it as well. How do you play that coach, facilitator role to keep your client engaged with it and get the best out of...? It's almost like an outside team that you bring together. How does that all work?

John Wortman: Yeah. Communication is huge. So, if you can make sure that everybody is getting the same meeting summary and understands what the next tasks are that we need to do, and the why behind what we're doing, that's helpful. And in terms of the personalities, sometimes there are big personalities, sometimes there are smaller personalities on the team. But if we can keep that end goal in mind and keep the communication level high, that tends to work pretty well. And I find that the more skilled and experienced an advisor as well as being an attorney, an insurance professional, an accountant, so forth, their confidence in their skill level. They don't have to be the star of the show, because they are the star of the show. They know that the star of the show. You know it when they answer a question, because of the depth and the clarity in which they can respond, and so forth. You do have that, I'd say, the AAA or AA level where people are still trying to prove that they're in the majors, but for those clients where they already have a major league advisory team, there's really a lot of harmony in there, and people are willing to expose what they don't know and ask questions. And the learning just spirals forward at that point, because you're learning so much at that high level. Because you're getting to learn around other professionals who are willing to expose the continued learning process they're involved with, as well.

Tim Leman: Any tricks or things you've learned over the years to help with communication, when you're coordinating a large group of people inside, outside, and so on? How do you keep everybody on the same page?

John Wortman: I'm a believer in simple bullet form, grouped by topic, or who's going to accomplish it. And so, formatting is to me. I don't know if you're the same way, but if you get a long list of completely unspaced, run- on sentences all together, I'm just not a person who can pick out of that, what I need to know. But if I can open up an email and I can see, here's the five bullets. And in those two bullets, here's the underlined and italicized version that I'm supposed to be taken advantage of. So I think framing it. But then also once it's been framed, highlighting what it is that needs to be accomplished, and keeping it short. I would much rather get five emails with one thing that needs to be done in each of them, then one email with five. Because I find that it will bog down the entire process. Because busy people, don't have time to ever do five things, but they'll always have time to get one thing done. And so, they can delete that email once they get one thing done, and tackle the rest of them later. But I think breaking things up that way, does help.

Tim Leman: I'm on the same page with you on that, I try to really do the same thing of breaking out in bullet points, putting some bold headers on things. Because I know how I'm reading things, very quickly, skimming through and get the highlights done on that. So I, and inaudible just bogged down, just getting blocks and blocks of information there. I think I read this, but which paragraph was that in? And my gears lock up on all of that. No, that's really, that's good stuff. John, thinking about your advisors too, and as they grow their businesses and we're talking about, that was a trick to use for communication. How much do you guys get into teaching, and training some of those, I mean, I guess people call them softer skills, around how to communicate or time management, and those kinds of things? Is it something they just have of learn and figure out? Or is that something where some of you who have figured that out, help share that with some of the younger people?

John Wortman: Yeah, we coach it. And so, we have an advisor development team, and their job is to take people through a process. So we have L1, to L10. L1 is an internship, and L10 is retirement. And so, we try to teach our advisors at each stage of the game, what's it feel like at this stage? Level two, you've just started in your career. Level three, you're going to be overwhelmed with these issues, and here's what you're going to face. But you're going to get through them, and here's what it's going to feel like. And then, as you have these groups of people that move through each of those phases, it's easier to go grab lunch with them again in a transparent organization, that's got a well- defined career path. It's easy to talk to an L4 when you're in L3 and say, how did you get through this part of it? And so forth. And so, that also then translates back to the softer skills like, hey, I seemed to run into an issue with this, and how would you attacked that? And I also say that, whenever someone comes in, a newer advisor, they get assigned to 40 relationships, because we think 40 is about the number of clients that any advisor is able to really serve well. And so, if you're assigned to, let's say eight to 10 clients, across four to five advisors, you now get to witness four to five different styles of delivering communication. You get to watch four or five different styles of written, or verbal, or body language reading, or things of that nature. And what ultimately happens is, what I am is, I'm just a product of all the advisors that I've worked with over the years, because I've heard them, and now I watch it. I was sitting in a meeting yesterday, and here's one of our very best advisors. I'm like, that's my story, man. That's mine. And he delivered it better than I did, because he improved upon it, and so forth. And I guess that's a piece of it as well. So getting exposure to all those other advisors, hearing them do it well. And then, now obviously there's coaching available if you can't pick those things up and put them together. But this is very much an entrepreneurial culture. We don't have a salary and bonus type of a deal. You don't go complain to the branch manager if something's going wrong, we're business partners. If I bring in a client that ends up working with another advisor, that advisor and I, are in a business partnership in perpetuity. That's another unique aspect of our model is, we're aligned forever because our compensation goes on forever. So as an advisor builds their practice, we pay them indefinitely as long as the client's still part of the firm. And so, what that then does, is it means that anybody who is in that kind of a relationship where they've originated a relationship for someone else, there's an internship that happens naturally. Because you can't afford to have that person not do a great job. And so, if they're not articulating something well, if they're sending an email, I would say, if you've replied an email twice, pick up the phone. Stop. There's something about this that's going back and forth, that needs to stop, just grab a phone. And this younger generation, they're so used to electronic communication, that calling someone is out of line. And so, that mentorship occurs because I want to make sure that they're doing a good job, because I want to protect my pension. Because my pension is, if that client stays here longterm, I get paid forever, and the same for them. They get the opportunity to originate their own relationships off of that. And I want them to have that same opportunity, to grow their careers like I did mine.

Tim Leman: Oh, that's cool. All right. So, final question before we go to rapid fire. John, for you personally, what would you say is your edge in life?

John Wortman: I was thinking about that earlier, as I tried to come into this year with the word intentional. I want to be more intentional. So much of what, I feel, happens around me, is somewhat unintentional. And then I got about three months into the year, and I realized that maybe my unique ability is being unintentional. This podcast, never done one. You asked me to do it. Why did I say yes? Because it felt like the right thing to do. When I take advantage of those things that just come through and then figure out how to piece those things together, I think that one of the things that's made me successful, is taking advantage of things that randomly are put in front of me, and figuring out how to put them together. I always said that there are a lot of opportunities of dimes, but you can't spend dimes, you got to spend dollars. And someone's got to find the duct tape to put those dimes together, to make them into dollars, and make out of it. And so, I think I've tried to teach other people that, I can look around their offices and see 25 dimes, but they don't have a dollar yet. And so, just how to take those little pieces of opportunity, and put them together into something more special. And I think there's a lot of unintentional activity in that. And I think that maybe is something that I'm good at.

Tim Leman: That's really interesting. It's different than anything I've heard from anybody else. And so, I can see that. I mean, I think intentionality is good. And go in with a plan, but be able to read, react, adapt, and so on, coming out of it. And for some people that really gets them flustered and they can shut down, and for others, they can thrive on some of the uncertainty, and do something with it. So, really cool. Okay. Let's shift gears to rapid fire. This is always my favorite part of the show. Okay. Well, we'll start with some easy ones here on the rapid fire piece. What's your favorite color?

John Wortman: Blue.

Tim Leman: What was your first car?

John Wortman: A 1985 red, Chevy Blazer. And I flipped it, and nearly killed my two best friends. Sorry.

Tim Leman: Oh man. Wow.

John Wortman: Yeah.

Tim Leman: What's the most memorable concert or performance you've been to?

John Wortman: Hamilton.

Tim Leman: Hamilton? All right. Where did you see that?

John Wortman: Saw it in Chicago at the, whichever theater it was performing in. And then I saw it a second time, I was like, wait, Aaron Burr is different. And fortunately Aaron Burr that time, was Wayne Brady. So I'm like, I recognize that guy. And so, I saw it twice, but I got a different experience, because Wayne Brady, turned into Aaron Bird. So it was cool.

Tim Leman: Oh wow. That's really cool. Yeah. We went to Chicago for my wife's birthday, a few years ago with the kids. And had a great time there, Hamilton as well. John, what's something about you, that very few people know?

John Wortman: I don't think most people know that my sister lives just a few doors down from me, and is the head of the Indianapolis Motor Speedway's legal department.

Tim Leman: Oh wow. That's really cool.

John Wortman: And then my dad's been to the 500, seventy years in a row. And his daughter ends up being involved at the Indianapolis Motor Speedway. And I'm the one who loves sports.

Tim Leman: That's really neat. And you guys get along well enough to be in the same hood together. That's good.

John Wortman: That's right.

Tim Leman: Which actor would you have play you, in a movie about you?

John Wortman: It's not Will Ferrell and it's not... it's more a Will Ferrell, or the guys from Wedding Crashers, than it is anything else. Yeah, because just not taking yourself seriously.

Tim Leman: Yeah.

John Wortman: I've learned slowly over time, to take myself a whole lot less seriously.

Tim Leman: That's great. Three people you'd like to have dinner with?

John Wortman: Goggins. I like that guy. I just think he would just come across the table, and get after me, which that would be cool. Coming off of Hamilton, I think that would be a cool guy to sit at the table with. And obviously, I mean, you got to get Jesus at the table somewhere. So I'd be just hearing some of those stories. And I guess maybe three inspirational people would be...

Tim Leman: What's something big you want to do before it's all over?

John Wortman: Aren't kids the biggest thing? I want to make sure that they've turned into the best thing that they can turn into, based on my input and guidance of things that I've learned, but let than their mistakes as well. So I think that's when you know it's over. I always say that, whenever I get on an airplane when I'm with my kids, I don't ever say a prayer. But when I'm on my own on a business trip or whatever, I say a prayer every time. Because if this is how it ends and we're all together, that's okay. But if I'm gone and I haven't given the level of input that I want to give to help them become who they are, then that scares me a little bit. So I'd say the thing, I want to do more than anything else, is to be here long enough to give my kids enough input, that they can have awesome lives doing whatever they're passionate about.

Tim Leman: That's cool. It doesn't get any bigger than that with family. Well, John, thanks so much for joining us today. I enjoyed hearing about your story a little bit, your background. I always learn something new when I do these too, and we just really appreciate your time for being on the show.

John Wortman: Thanks for having me. Look forward to my next version of this.

Tim Leman: Thank you for tuning in today. I'm Tim Leman, and remember to own your edge. Subscribe to The Edge Podcast on apple, Google and Spotify.

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