The wealth channel funnel worked backwards, from the sales target to producing advisors, advisors in scope and the size of the external team.
Work backwards from the target: divide it by what one producing advisor places in a year, then divide by the share of covered advisors who ever produce. At an average ticket of 150,000, five tickets per producing advisor and 8 per cent conversion, raising 100 million a year takes 134 producing advisors, 1,675 advisors in scope and, at 900 touches a year each, 10 external wholesalers.
Worked in full in The Private Wealth Fundraiser by Julian R. Sterling, with every figure reproduced in a free workbook.See the book on Amazon →
Private markets managers entering the wealth channel usually set the target first and the coverage plan later. The funnel runs the other way. Sales are made by a small number of producing advisors, each placing a handful of client tickets, and those producers come from a much larger population of advisors who have to be found, approved on their platform, educated and visited. Every term in the chain is an assumption you can test against your own data.
| Input | Value |
|---|---|
| Gross sales target, one year | 100,000,000 |
| Average client ticket | 150,000 |
| Client tickets per producing advisor a year | 5 |
| In-scope advisors who produce, steady state | 8% |
| Touches an external wholesaler can deliver a year | 900 |
| Fully loaded cost of one external | 300,000 |
Producers = target / (ticket × tickets per producer)
100,000,000 / (150,000 × 5) = 100,000,000 / 750,000 = 133.3, so 134 advisors who
actually place money. Behind them sit 667 client tickets. In Excel:
=ROUNDUP(Target/(Ticket*TPP),0).
In scope = producers / conversion = 134 / 8% = 1,675
Each in-scope advisor is worth 59,701 of sales a year on average, which is the number to hold against the cost of covering them.
Not every advisor gets the same attention. A tiered plan concentrates touches (meetings, calls, events, webinars) on the advisors most likely to produce:
| Tier | Share of in scope | Advisors | Touches a year each | Touches |
|---|---|---|---|---|
| Top | 15% | 251 | 12 | 3,012 |
| Middle | 35% | 586 | 6 | 3,516 |
| Rest | 50% | 838 | 2 | 1,676 |
| Total | 1,675 | 8,204 |
At 900 touches per external a year, 8,204 touches need 9.1 externals, so 10, each covering about 168 advisors. That is 61 touches for every advisor who ends up producing. At 300,000 each the team costs 3,000,000 a year: 30,000 per million raised, or 300 basis points of the first year's sales, which the recurring fee on those assets must repay over several years.
| Conversion | Ticket 100,000 | Ticket 150,000 | Ticket 200,000 |
|---|---|---|---|
| 4% | 5,000 (28) | 3,350 (19) | 2,500 (14) |
| 6% | 3,334 (19) | 2,234 (13) | 1,667 (10) |
| 8% | 2,500 (14) | 1,675 (10) | 1,250 (7) |
| 10% | 2,000 (11) | 1,340 (8) | 1,000 (6) |
| 12% | 1,667 (10) | 1,117 (7) | 834 (5) |
The two inputs nobody controls, conversion and ticket size, move the required coverage by a factor of six across this grid, from 834 advisors to 5,000. Tickets per producer matter as much: at three a year the plan needs 223 producers, 2,788 advisors in scope and 16 externals; at eight, 84 producers, 1,050 advisors and 6 externals. Deepening existing producers is the cheapest lever on the page.
Conversion is not a constant. It builds month by month after a platform goes live. If year one averages half the steady-state rate, 4 per cent, the same 1,675 advisors raise about 50 million, and hitting 100 million in the first year needs 3,350 advisors in scope and 19 externals: almost twice the team for a year, or a target that admits the ramp.
Because the target is a product of three inputs, a shortfall can be traced to one of them, provided each is tracked monthly against plan. Sales short with producers on plan means tickets are smaller or fewer per producer: a product or suitability problem, usually solved with the advisors already producing. Producers short while touches are on plan means conversion is below 8 per cent: a narrative or platform problem, and more visits will not fix it. Touches short means the team is under capacity or spread too thin, and that is the only miss that more externals solve. Hiring wholesalers to cure a conversion problem multiplies the cost and leaves the funnel exactly as leaky as before.
Starting from the top: "the platform has many thousands of advisors and a tiny share of their assets would be 100 million". That sentence has no conversion rate, no ticket size and no coverage capacity in it, so it cannot be wrong and cannot be managed. The second mistake is counting approved advisors as in scope. An advisor whose platform has approved the fund but who has never been touched converts at close to zero; only covered advisors belong in the denominator.
The coverage model of a platform tier by tier, and the triage of a target list against what a salesperson can hold, are in the blank set on the companion page of The Private Wealth Fundraiser, beside the free forecast workbook for its worked case. For why gross flows from such a channel keep rising long after its growth rate has peaked, see why gross flows rise as growth falls.
Your own, measured as the share of covered advisors who place at least one ticket, and modelled as a ramp rather than a constant. The required coverage is very sensitive to it: in an illustrative plan to raise 100 million with 150,000 tickets, 4 per cent conversion needs 3,350 advisors in scope and 12 per cent only 1,117.
It depends on how many touches each advisor needs, not on a fixed ratio. With a tiered plan of 12, 6 and 2 touches a year, averaging 4.9 per advisor, and a capacity of 900 touches per wholesaler, one external can cover about 184 advisors at full capacity. Raise the touches per advisor and the coverage per external falls in proportion.
Because conversion builds month by month after each platform goes live. If year one averages half of a steady-state 8 per cent, an illustrative coverage of 1,675 advisors raises about 50 million instead of 100 million, and hitting the full target in year one would take 3,350 advisors and 19 externals.
This article is one calculation from The Private Wealth Fundraiser. The book takes the same case from first principles to the decision, chapter by chapter, and every figure it prints is a live formula in the free companion workbooks.
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