Whose advice are you buying?
June 7, 2019
In 1992 I co-founded the UK’s third independent international advisory firm. I did this just as the City was entering its fastest period of growth, fueled by the Big Bang of ’86. I did this because I knew then, as I know now, that systems will burn when independence is eroded from their structures; that the only advice is independent advice; and that independent advice can never come from the ones pushing the products.
These days, as the FT’s special report notes, the boutique model has exploded, and now commands up to 35% of all M&A fees. When it comes to advice, big is no longer beautiful. Partly, this is circumstantial: as heavy regulation and scrutiny renders City life less fun than it used to be, experienced hands are leaving in their droves to seek more amenable conditions. But boutiques deliver on other fronts too. They’re about mutuality. They operate on partnership, small trusted teams, and real skin the game – qualities that yield value for everyone. For this reason, between many other ventures, I’ve always returned to the boutique market – co-founding Time Partners a few years ago to be a home of independent advice for entrepreneurs , venture capital and families worldwide.
Though boutique banking might be booming, in today’s world, independent thought and advice is our scarcest resource. Our chances of accruing either are vanishingly small.
Consider the cognitive burden on every individual to grasp the complexities of today’s world. In the first place, we must be lucky enough to possess critical skills (either innate or taught). We must be able to vet and select our sources of knowledge and consult them daily. We must be able to trust those who mediate our facts to do it with integrity. We must have the will or the interest to seek opinions beyond those of our peers, and to consult with open ears those that would counter everything we believe to be true. We must do all this every day, in whatever time we have, in the full knowledge that what we know, and the opinion we’ve formed, may only last as long as the 24-hour news cycle.
Consider all of this, and then consider the point we are at as a country. We are in the midst of our own intellectual Big Bang. Information is no longer regulated. Knowledge has been compromised. Once again, the world is burning. But this time, there will be no quick bail outs. When independent advice and independent thought has become so hard to extract we know our institutions are failing us.
In these strange days, the BBC has a weighty responsibility to explain the world better. To be impartial – not to ‘balance’ one misinformed voice with another. To properly enquire who exactly is pushing the products, to what audience, for what gain. And it must do this quickly, while we have the stamina to seek understanding. This is the only route back to reason.