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Building the Business 101: From Home to Virtual to a Real Office

As their office evolved, two advisors had to make decisions that countered their goals.

Veena A. Kutler and Annette F. Simon, 04/06/2006

This monthly series of articles will describe the steps and occasional missteps we took in building our financial advisory business, Mosaic Wealth Management. This is the second in the series. The first discusses how we became partners.

Mosaic is a fee-only comprehensive financial planning and investment management firm located in Bethesda, Md., a suburb of Washington, D.C. At this writing, we have about $50 million under advisement, 40 plus clients, two employees, an 1,100-squar-foot office suite in a Grade A building, and the two of us--Annette and Veena--the principals and equal owners of the firm.

Starting Out: Our Home Offices

Like many new advisors entering the field midcareer, both of us were attracted to the profession in part for the flexibility and ability to set our own schedules it offered.  Neither of us was eager to take on either a daily commute or the responsibility of an office and a staff.

Moreover, leasing commercial office space is an expensive proposition: initial deposits, build-out costs, monthly rent, furniture, computers, parking, and don't forget the utilities. At first glance, none of this expense directly benefits clients, but it does come straight out of our pocketbooks. While we were committed to paying for high-quality software, computers, and other tools necessary to produce for our clients, we balked at paying for an office.

We merged our practices in early 2002 and chose to work from our respective home offices. Both of us were lucky to have family homes that could easily accommodate our decision. We did not have to convert spare bedrooms or lurk in the basement; each of us had a separate room in our homes designed as an office. We each also had a second phone line dedicated to the business and broadband Internet service. We decided to complete all analysis, trading, and planning from home. Communications with each other took place by phone, e-mail, weekly lunches, and other meetings. We met with clients in their homes or at their offices. And they loved it! Clients were more than happy to have us come to them. And although we were not happy traveling to every meeting, we had to concede that a home visit provided valuable insight into a client's life.

This type of operation lasted only a few months. Clients often demanded weekend and evening meetings (since that is when most people are at home) and created a schedule that disrupted our family time and reduced our control over our own work hours. It was from the lifestyle changes we were seeking to achieve. In addition, we found it challenging to maintain the needed professional tone during a home meeting. Kids, dogs, cats, phones, doorbells, televisions--in a few short months, it felt like we saw it all.

Getting Control: The Virtual Office

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