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With two new CEOs at Loan Market Group, the aggregation and brokerage group leaders have revealed their vision for building a multi-model offering.
Last month, aggregation and brokerage group Loan Market Group completed its leadership restructure by appointing Ewen Stafford as executive director and CEO of its wholesale aggregation arm, LMG.
The move followed the group’s decision to appoint two separate leaders for its wholesale and brokerage offerings, with David McQueen leading the brokerage as Loan Market CEO.
Sitting down with The Adviser at its Growth conference in the Gold Coast last week, the two new CEOs outlined their vision for their respective channels and the three service propositions under the group: 100/100 Flat Fee, Partner, and Loan Market.
Speaking to The Adviser about his first six months in the Loan Market CEO position, McQueen said he believed the group was unique in offering three separate models to brokers.
He said: “Our overall proposition is so compelling. Our overall proposition, where we have all three models, including the consumer brand, is a really unique place in the market. This is a really unique place in the market. Nobody else does that. Nobody else has a franchise, consumer brand (Loan Market), a whole support model (Partner), as well as a wholesale aggregation base (100/100 Flat Fee). That’s a key differentiation.”
The Loan Market CEO said that brokers choosing the brokerage route typically want a “more hands on support model” through the Loan Market and Partner offerings.
“On the brokerage side, to me, it’s about how we can actually play an active role in helping them [Loan Market brokers] be the most productive and profitable businesses,” McQueen said.
“We’ve got a hands-on role in the business,” McQueen said, noting that Loan Market has a support ratio of 1:50 plus a marketing coach, recruitment services, and business coaching, while LMG has 1:150.
“That is the difference between the aggregation and the brokerage component to me; we [Loan Market] are a partner to enable you [a broker] to achieve those goals, whereas I think LMG aggregation is an enabler to that.”
According to McQueen, after “getting out listening” to both brokers and head office staff to understand what was most wanted from Loan Market, he found that those choosing the brokerage routed typically wanted “a huge amount of business support in terms of business coaching” and marketing support.
“Coming into the role, I was surprised by how much brokers really value that support and how much they want that support; whether it’s marketing, whether it’s [a six-month development program for business-owning brokers servicing 75–100 customers a year, led by Michael Karpathakis], whether it’s TalentForce (which is supporting them to recruit), and how much they actually need a partner,” McQueen said.
“I was surprised how much they really value that support, and they don’t necessarily want to run that race themselves,” he said, adding that it had welcomed 15 businesses into the Partner model over the previous week.
“So having a business partner to do that with them is really, really valuable.”
McQueen said he believed the scale of the group as a whole enabled it to harness “valuable performance insights” to “go and look at the best businesses out there and understand how those businesses are successful … the cost of those models, the efficiency of those models, what can go wrong, what can go right, and provide those unique insights to tilt into those spaces”.
Similarly, newly appointed LMG CEO Stafford said that the wholesale aggregation offering is typically attracting brokerages that want less hands-on support on how to run and grow their businesses.
While they may use the MyCRM Diversified platform, they may also want to use technology and services from outside of the group or have developed them themselves, he said.
As such, LMG is focused on providing technology, compliance, cyber protections, and diversification support (including to Loan Market brokers as well as sub-aggregation brands Nectar Mortgages and MoneyQuest), while Loan Market also had additional specialised services.
Despite having been in the CEO position for less than a month, Stafford said he had been focused on the aggregation group’s operating model for delivery and the opportunities to “enhance and evolve the education and confidence and competency” of brokers aggregating through them.
One part of this was education and learning and development on diversification and “the ability for businesses to tailor their own learning pathways to their own business and where they’re at at a particular time in their growth and their maturity”.
He said that he was also looking at the technological backing of the aggregator and how to evolve the systems and support by using AI in technology to “lift those service levels, quality, and speed”.
Stafford said: “Technology is a huge part of our investment.
“It’s always been our ambition to be at the forefront of technology. So whether that’s providing the MyCRM platform – and a large percentage of our investment goes into technology, engineers, data scientists, data and analytics, product managers and cyber security specialists – but now also artificial intelligence. We’re looking at it everywhere – from compliance to operations.
“With this change with the two CEOs, this has also actually freed Sam White [executive chairman] to spend even more time looking at the world of what those possibilities might be.”
Stafford said his main priorities for the coming months are to provide services to the highest quality and as efficiently as possible, ”get that tech adoption up further” and “continue to champion diversification”.
[Related: LMG appoints new CEO]
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