completed business plan for davidson wealth group

Davidson Wealth Group


Business Plan

3664 Coolidge Court

Tallahassee, FL 32311

[email protected]

(863)-608-0769

Cole Davidson

April 2016

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Table of Contents

Mission Statement and Company Description…………………………………………………3

Research Questions……………………………………………………………………………5

Executive Summary………………………………………………………………………….12

Industry Analysis……………………………………………………………………………….14

Target Market…………………………………………………………………………………..16

SWOT Analysis…………………………………………………………………………………20

Strategic Position and Risk Analysis……………………………………………………………22

Marketing Plan…………………………………………………………………………………..23

Operations and Technology…………………………………..………………………………….25

Management and Organization………………………………………………………………….28

Social Responsibility and Sustainment…………………………………………………………31

Finances…………………………………………………………………………………………

Appendix……………………………………………………………………………………….38

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Part I: Company Description

Description

Davidson Wealth Group is a financial and investment services company providing ways to better execute financial growth and transactions for individuals and companies. We want to a distinguished team of managers, advisors, and analysts to not only give you the tools you need for your own financial prosperity but to also help your company make the correct allocation of its resources to expand and prosper.

The Company Mission

The mission of the company can be summarized in one word: positivity. In the world of finance, making a gain on an investment is not just important but it’s a top priority to you and us when you are seeking out a return on your investment. Davidson Wealth Group is dedicated to have strong relationships with clients so that we can that build trust and get referrals from other people and companies that would be interested in our services.

We would start small with maybe one staffer and two financial representatives. With less workers meaning a smaller payroll we can focus more on trying to pay off other initial start up costs.

We aim to become profitable but we also want to pay off debts. What we want is a debt paid off in three years. Even though this is contingent on a couple factors we would like to eliminate debt as early as possible so that we can enjoy higher profits that can be reinvested into expansion. By five years at the latest, want to be earning higher profits after we’ve paid our investors off and have probably double up on employees.

Services

Anyone can find a variety of various services offered at Davidson Wealth Group. We offer all kinds of help and resources with knowledge on the current affairs of the financial markets and the tools to make your optimum choice. The services that we offer for both companies and individuals such as: College savings planning, Traditional & Roth IRA planning, life insurance, mutual funds, real estate, and general asset management services. But as mentioned, Davidson Wealth Group also provides services for companies such as: consulting, budget and cash flow analysis, financial statements, auditing, investment advisory, and mergers & acquisitions. If it can be managed in the future, the firm looks to add on CPA’s to be able to conduct full accounting services.

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Initially, we like to meet with the person or company first to discuss their goals and financial strengths before diving into business. We want to have healthy clients or at least ones that are motivated to make advancements. Such as a teacher who makes $33,000 annually who needs to invest early for good retirement planning. Or a big scale company like Burger King buying Tim Horton’s for example. The joyful benefits about working in the world of finance is that there are so many types of business to bring. Diversification is big in the industry because when you think about investing stocks, a lot of people will say to themselves that it is probably good not to put all of your eggs into one basket. It can be the same way with clientele in the market. Working and advising to different demographics builds company strength and it also brings in a lot of connections and referrals that bring forth more growth and incentives for the firm.

Development to Date

Founded in January 2016, owner Cole Davidson decided to write his own plans to start his own financial firm after time spent working at one in his college career. He decided early on to make James Dever his Vice President of Operations where the daily movement of assets and calls were handled in his department while Cole, as CEO of the company, would handle the financial analytics and economic forecasting to make suitable recommendations to the clients and businesses. By April 2016, the planning for Davidson Wealth Group is projected to be complete with operations beginning in August of 2016.

Legal Status and Ownership

The firm is registered under an S-Corporation entity. Of the 15,000 company shares, Cole has an ownership of 8,500 shares while Dr. Dever owns the other 6,500 shares. The capital raised for the initial start up is funded from both Cole and Dever after their savings from years that made them able to buy into the venture of financial services.

As of now, the new and upcoming firm is looking to seek more capital funding from outside investors and are currently location scouting for a good area in the city of Tallahassee that has people in need nearby.

Part II: Davidson Wealth Group Mission Statement

Mission Statement: The mission statement of the Davidson Wealth Group is to provide you with a strategy that is optimal for you and your financial security.

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Business Plan Research Questions

Industry/Sector:

1. How many other financial services companies are in the area?

A: Competition is fairly large in Tallahassee as the town has over 20 firms that deal with financial

services.

2. Will the needs for financial services increase?

A: More and more people are seeking help to manage their finances so that they can make

substantial growth out of them to have better savings for retirement. Indeed, it would be fair to

say the needs will be increasing.

3. Can a local firm take on a corporate finance firm?

A: Yes, my former roommate who is from the area, has a father who owns Wealth Management

Corporation right here in Tallahassee

4. What is the future outlook for independent fee-based financial advisors?

A: Independent fee-based advisors are good because they have their own personal network of

people in their town that helps not only get referrals through the ones they know, but also a

strong reputation from word of mouth advertising.

Products/Services:

1. What kind of products/services can I offer that other financial services firms do not offer?

A: A possibility I have thought of is specialized help in real estate investment. Although that may

be tricky, I have thought about a firm that can also make recommendations to renting out real

estate instead of buying out properties.

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2. Which specific financial service is most popular?

A: In an interview I had with Forester Financial in Tampa, FL I had an interview with the Vice

President and Branch Manager Jeff Voehll. He told me something that surprised me and said

that a survey claims “Americans biggest fear is not death anymore, it’s running out of money for

retirement. Essentially, the fear of going back to work.” Once he told that to me and the other

candidates in the room that was when I learned retirement planning is the most popular of

services because people want funds to be secured with.

3. What is the need your business exists to satisfy?

A: The existing need to satisfy customers at a financial firm is to make sure that they’re wealth is

not only protected, but strategically invested and utilized. Some advisors may offer that instead

of investing in the market with 40% stocks and 60% bonds that you would switch the ratio to an

even 50/50 because of market volatility (just an example).

4. How will your business satisfy the need?

A: Providing services that offer an optimal ROI and protection of assets to help build integrity to

our clients who will refer more people that they know to us. The key to clientele management I

have learned is understanding and relationship building.

5. What are the flaws in some of the services offered in financial services firms?

A: An issue in this area is a lack of integrity a lot of bigger firms will take on clients and give them

a policy that works out for their own personal gain.

Target Market:

1. What are the demographics of the clientele for a financial firm? (socio-economic status, gender,

ethnicity, age)

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A: Though it may depend on the town, I have noticed that clients of both genders, and many

other races come through financial services. Although they are general 30 or older from what I

have seen and asked other advisors. Some are also business owners and some may be high

school teachers.

2. What are their lifestyle preferences?

A: Most of the time, clients who are trusting themselves with a financial firm are looking at their

money in more of a long term view. Since this is the case, clients will usually live more of a

conservative lifestyle. This may not mean that they are a “penny pincher”, but they also do not

choose to live above their means either.

3. How do they choose to treat their money?

In this day and age, the term “passive income” has been a popular term these days. Passive

income is better known as money that you don’t work for, it works for you. Financial services

can help you make bigger earnings of passive income if done right. So clients will focus less on

spending and more on investing.

4. What are the occupations typically for clients in financial services?

A: As I have briefly mentioned before, some are business owners, some are teachers, and many

that I have begun to observe are also state and local government employees too.

5. What is a minimum requirement of assets needed to work with clients if there is one?

A: There is not much of a minimum but some firms handle it differently. I have heard some firms

say that they won’t talk to you unless you have a certain salary but I have also heard some say

they won’t work for you if they’re not insured either. Other firms also like to take low income

employees because maybe that is their niche. Low income workers would not be a problem to

me as long as the client is safe with good credit and insurance.

Competition:

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1. What is the financial strength of the other financial firms?

A: The financial strength of firms is something that depends highly upon their assets under

management.

2. Does each firm have a niche of its own? If so, what is it?

A: No, each firm will try to exploit everything in the market to be an ideal competitor. Although

individual advisors might have their own, a firm usually does not seem to.

3. Are customers content with the other financial firms?

A: Not always, I have over heard clients complain to advisors on there being a shorter ROI from

another firm on their assets while expressing their gratitude to another advisor. A lot of firms

out there do a good job, but they do not please the needs of every person either.

4. How big is the clientele of other firms and how much in assets do they manage?

A: That depends on many things some firms are local and have not as many clients and handle

millions. But there are firms who are nation wide with thousands of clients that can manage

billions of dollars for instance.

Marketing and Sales Strategy:

1. What are the issues my financial firm can satisfy that I could truly and clearly say mine satisfies?

A: For some firms, the issue can be clarity. The customers will come to firm if they cannot

understand how to handle their finances and need the help of an expert. But if even an expert

can’t simplify the issues or uses of their assets to the customer then this causes problems.

2. How much needs to be allocated towards advertising?

A: Sometimes advertising will not be needed if a firm is getting referrals from other clients and

going out to various trade shows.

3. What is the key to a good website to advertise all the key services of a financial firm?

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A: Displaying your values and showing everything you do broken down to a simple explanation is

very important to show clients that you can get results and get them easily.

4. What will be the most effective promotional strategies?

A: What I have learned from Forester Financial in Tampa is that referrals are by far the most

important tool because it is a form of word of mouth advertising.

5. What are some big trends in sales with other financial firms?

A: Although this may not apply to all firms, I know that my firm, North Florida Financial, is well

versed in insurance policies because they are a subsidiary of Guardian Life. Life insurance

policies are still very popular in the industry.

Operations/Technology:

1. How much capital is needed?

A: While it may be tricky to find an exact estimate right now, the Small Business Administration

has given tips on their website on how to calculate a few of these things. After you understand

what kind of needs your costs will be, assessing your assets, and allocating your costs, their

website uses a Costs Estimator Calculator to then understand a number needed for initial

capital.

2. How big does the operations division need to be?

A: As I have observed so far with interning, interviewing, and networking at career fairs, the

operations and finance divisions work together in harmony. Therefore, size of the financial side

and assets under management are what play a role in size and growth.

3. What are the resources needed to run smooth day to day operations?

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A: Important resources needed for day to day operations is human resources. With human

resources, the department can be regulated with a code of ethics and assist in the helping and

recruiting of new workers.

4. What are the key requirements for customers to gain a clear understanding from company

website?

A: An important factor in customers understanding a company website is simplicity. The

financial service firm I intern with (North Florida Financial Corporation), uses a tool of their own

called the living balance sheet. It is a simply digitized balance sheet that neatly organizes their

assets and liabilities and paints the front of the sight with its easiness to gain understanding.

Long-Term Conditions:

1. What is the economics of the financial firm?

A: To summarize, the economics of the financial sector work in a way that helps expand

economic opportunity to individuals with lower income so that even low income workers have

an equal opportunity to invest and protect their assets and finances.

2. At what point will we need to expand?

A: If there is too many clients in one firm or a target market people of other people in another

neighborhood or city that has yet to be targeted, then expansion may be a good move.

3. How many financial advisors will be needed for the years to come?

A: The amount of financial advisors that are needed is very contingent upon the growth that it

picks up from clients and investments. If there less assets under management, then not as many

advisors will be necessary.

4. How long will it take to make a return on the initial investments of starting up the firm?

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A: If I am to go about this on loans then there’s a specific way it can be paid off in a timely

manner. According to the Small Business Administration (SBA), each loan has a maximum loan

maturity: real estate is 25, equipment is 10, and working capital is 7

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Executive Summary

The Company

Davidson Wealth Group is a diverse company that provides a wide array of financial, accounting, and investing services to individuals and businesses. If a person needs financial advise for a retirement plan or large portfolio, they are referred to one of our advisors, of if in need for accounting help, they are referred to one of our CPA’s. The same is also done for our company’s who need assistance in managing their funds or for helping them raise capital. With market of financial services experiencing rapid growth, we are striving for a different business model in the industry. The majority of stocks are held by the company’s CEO, Cole Davidson and the rest is held by the Board of Directors.

The Company’s Mission

At Davidson Wealth Group, we keep our mission statement to one word to summarize our company: Positivity. At our firm making positive gains with on our clients’ funds for is a top priority to us because it is top priority to them too. In the world of finance and investing, a top priority is making a return on your investment (ROI). That is what we tend to do with all of our clients in Tallahassee, the rest of Florida, and possible other states.

Products and Services

The most popular products and services the firm offers is financial advising and building portfolios. Although we have analysts who help us gather data to make recommendations for a company to make strides in the long run, accountants organize the finances, and a Director of Operations for mergers and acquisitions, the service that is in highest demand has been financial advising because of more and more people seeking the best advice from the top advisors. Financial advisors have advantages because they work in office they are flexible to work in the office and travel too, which gives them the opportunity to build their clientele as big as they want. Sometimes a lot of advisors will get so many clients, that they will break off into an umbrella company of DWG and have their own practice which benefits because while they’re doing the expanding for us, we can focus on the betterment of our other services that we offer.

Marketing and Sales Strategy

Besides typical strategies like social media, billboards, or sponsorships, our most effective and cheapest method of marketing the firm will be through word of mouth. Typically, many asset management firms have the incentive to do their best for the clients because a lot of advisors will use the referral system to get more clients. Once appointment are done, the advisors will ask if there is anyone else they might know who could benefit from their help. A lot of times, this can bring much more business to the firm and the best part about this system is that it is free and sometimes clients can be rewarded for their efforts.

Clearly conveyed language will also generate success and interest from others through our plan. It is good to be optimistic but also realistic. Therefore, using terms like “the best”, “unbeatable”, “amazing” and so on, are not the best methods because they are not factual and can reduce your credibility. Rather, say something attractive yet true such as “Our product has x and y features that the other products in this market do not, giving us a competitive reach in the market”, would work much better and will really

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magnetize the attention of your interested investors. Using fan reviews and positive survey feedback is also another effective method because we will gain more interest in investors if they see some credibility behind what your product and services are.

The Competition

The financial services industry is large so there is a lot of competition. One of our biggest leaders that we compete with is Raymond James, but our diverse model has services they cannot provide. For their institutional and corporate services, they do not provide mergers and acquisitions, which is one of our specialties. Along with that we provide a wide array. Firms will provide all kinds of services that they see useful, so DWG is taking on the ones that are seen best fit for all types of different clients.

Management

President and Founder Cole Davidson brings years of qualified financial experience working in the past as the senior financial planning manager at Raymond James. He started at the bottom as an entry level junior analyst where he moved up the ranks over time after seeing the CFO’s limitation of reach by the rest of the board, he decided to break away into his own practice where the Board of Directors creates their

Industry Analysis

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In this section of my business plan for Davidson Wealth Group (DWG) I will provide a clear view of the finance industry, where it’s going, and why DWG belongs there. Many entrepreneurs will seek to find an industry that they think they belong to but will not always dive in with enough research on the industry. Maybe that’s another reason why more new businesses fail then succeed.

Many many years ago, banks were merely local institutions governing city and state transactions. Today however, things have made some big changes now because the financial industry has gone global now. Money has the ability to travel across the world in seconds. Offshore accounts have also become a popular (yet frowned upon) form of investing and saving. For as long as we can remember, people have been looking for ways to invest their money and make it grow. The financial market has become a vehicle of the highest popularity for investment.

As I have stated before, I have mentioned that I belong in this business because of connections that I have made in Tallahassee. As mentioned earlier consumers are looking for ways to invest their money but don’t always know what the advisors and wealth managers would do to make an optimal return on investment. But with the experience and enthusiasm I have for this sector I plan to bring my own firm in.

The economic cycle of the finance industry wasn’t that great not too long ago. In 2008, the US economy experienced the financial crisis, which gave us the worst recession we had since the great depression. It all started when Wall Street began bundling home loans and selling them to big investors (banks). The banks began making bigger profits of the loans they sold to people. Enough that they started lowering their standards to those with bad credit scores too but when housing prices unexpectedly went up everybody starting defaulting on their mortgage loans. Banks knew bad mortgages were risky which is why they all bought default swaps so they can insure these bad losses and not have them on a financial statement. But the problem was that they all bought up high amounts, especially AIG which caused them to almost go under. Afterwards, this crisis caused a recession that we have been working hard to recover from for 8 years.

While the financial market is a mechanism that ticks and operates year round, there are also seasonal changes in the markets with stocks and government which is supposedly linked the economic activity and cycle in the US. The same can be said in Canada (since the market is global). An investing behavior showed us that in Canada if investors had invested in more risky securities on a more consistent basis (Canadian government bonds in this case) in the November to April period and pulled out everything together for the May to October period, there could have been an average annual rate of return of 21% over the last 47 years. (http://www.bengrahaminvesting.ca/)

The size of the financial market is also very big. It is global but it is also very big in the United States. In fact, our financial markets happen to be the largest and most liquid in the world. In the year 2014, finance and insurance products happed to account for 7.2 percent of the United States’ gross domestic product (GDP) which is an estimated monetary value of $1.26 trillion (http://selectusa.commerce.gov). In this economy, our exported manufactured and agricultural goods have a lot of assistance in being financed thanks to the sales of financial products. A lot of economic benefits are contributed through the financial industry. According to selectusa.commerce.gov, the United States was recorded with exporting $92.5 billion worth of exports in financial services and had a $23 billion surplus in services and insurance trade. With the recession mentioned earlier, obviously the firms took a

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big hit along with the people of the US meaning that there was a need to make a progress of recovering before being able to expand. This could mean gathering more clients or hiring more employees. But the financial sector has most certainly been experiencing positive growth. In 2014, the financial services and insurance sectors employed close to 6 million people with the securities subsector of the industry showing the greatest chances for growing its workforce with an expected 12 percent increase by 2018 which is certainly above average. With more people also deciding to advance their education for the future as well, we can only expect to see more growth that will make the sector competitive with its growth rates.

High levels of enthusiastic investment behavior would offer firms like DWG good advantages in the market. In 2012’s listings of fortune 500 companies, 132 of them moved their headquarters to the United States to take advantage of its creative and most competitive financial services sector. The industry offers the greatest selections of securities and products for consumers to pick from so that they may insure themselves and gain a good return on their investment (ROI).

The financial services company is so big and broad however. The industry is known to be a lot bigger of course. There are four main sections that make up the financial industry. The first and biggest one of them all is banking, The US banking system holds an aggregate amount of $14.45 trillion in assets. The banks are backing the worlds largest companies and are very diversified in the investment side of banking and the highest concentration of private credit. The next one is asset management. In the United States, asset management is a part of the sub sector that is unrivaled in its abilities to make optimal investment choices. Asset managers, or financial advisors, are currently meeting the pension management necessities of 55 percent of the global retirement market. Essentially, this sector has a big focus in retirement planning. Pension assets got high up to $18.9 trillion in 2012 (http://selectusa.commerce.gov/). If insurance policies and mutual funds were also included, the amount would be nearly double that. Insurance is also another sector. In 2012, the insurance industry was reported to have net premiums that totaled to $1.27 billion (http://selectusa.commerce.gov/). The last subsector of the financial industry is the oldest and the most dominant of them all, venture capital. Companies that were financed by ventured capitalists did good in the year 2012 as well, employing more than 12 million people and generating nearly $3 trillion in revenue which made up 11 percent of the private employment in the US and generated revenue that would equal out to more than 20 percent of the GDP.

In conclusion, we can see that the financial sector has a lot of its own characteristics that are unique and unpredictable but if the right people help consumers, it is attractive and lucrative. The market itself will also be growing and will be needing jobs, making the opening of Davidson Wealth Group a good time to enter the market.

Target Market

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Market Description

Davidson Wealth Group is a private financial institution that specializes in services that tend to the

financial needs of businesses and individuals. The firm is currently operating in Tallahassee, FL. Although

we are isolated to one location for now, the firm is still able to recruit clients from other cities and states

(some advisors at the firm I work for have clients in Texas and New York) because of client referrals that

extend into the family network. As long as advisors apply and pay fees to FINRA (Financial Industry

Regulatory Authority), they are allowed to operate out of state with clients if they desire to. But what

we want is to have as much reach as possible. After securing strong clientele in Tallahassee, Davidson

Wealth Group will seek to reach out to other clients through multiple resources like client referrals and

trading shows. Not only would we like to target other high income cities in Florida but we are also aimed

at other states that are economically strong. Our intended targets would be:

West Palm Beach, FL

Miami, FL

Indian Rocks Beach, FL

Palm Beach Gardens, FL

Texas

New York

Massachusetts

Maryland

If Davidson Wealth Group can penetrate some of these states enrich our potential and even create

opportunities for expansion to some of these areas if we were to build more clients with referrals,

events, and community outreach. The beneficial gain for the industry is that the geographic market is

not very limited to locations in the United States.

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Market Size and Trends

A lot of growth for the job market in the finance sector has grown exponentially and will continue to.

This is a good sign for the industry because it tells us that more people are turning to financial firms to

handle their assets. After the 2008 financial crisis with low housing prices soaring through unanticipated

levels that caused two investment banks to go under along with AIG almost going under, people have

been more scared of lending their money to banks without the proper knowledge and use of the

resources they could use. Because of this, the market for financial advisors is growing. While people

work tirelessly for decades before retirement, everyone wants to have a good retirement plan so that

they don’t run out of assets during retirement and not have to go back to work.

These growth trends are giving us and multiple other firms such as Raymond James and

Foresters Financial to expand drastically. According to the Bureau of Labor Statistics there were 249,400

financial advisors in the US (http://www.bls.gov/ooh/business-and-financial/personal-financial-

advisors.htm#tab-2). These were recorded nearly two years ago, which means there is likely to be

positive growth since it also cites that the the employment change from then until 2024 will projected to

an additional 73,900 advisors which is close to a 30% growth.

Target Customers

Davidson Wealth Group targets a variety of clients that gives us a strong diversity of services as a firm.

Our large demographic into two categories with multiple sub-categories: Individuals and Businesses.

Here’s the defined sub-categories:

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Individuals:

Low income clients

High net-worth clients

Government employees

Business owners

Businesses:

Government entities (sometimes through Private Public Partnership agreements)

Private Companies who need financing

Companies that are in need of Mergers and Acquisitions

Real Estate firms

Extending our reach into all of these types of businesses makes us a very diverse company that is able to

provide a strong list of services that can provide assistance to clients from low income individuals, to

high thriving businesses. Even though it’s a client with low income or a business with great success we

would prefer that no matter the amounts of their assets, that they would be more fiscally responsible

and dependable clients that hold accountability for their word to us. Having rich clients is not always

attractive if there is too much volatility in the mix.

Strategy for Success

In the realm of finance, the market is always changing, not much about it is fixed or constant. The

market is not just local but is also global. Everyone who makes a paycheck usually chooses from a

regular set of decisions repeatedly made: spend, save, or invest. People realize they can make their

money grow, but they do not realize that there is always a much better choice providing the optimal

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outcome. People will always want the financial maximum for themselves which is why the market is

expanding healthily. That therefore, is what will give Davidson Wealth Group the means and opportunity

to thrive upon entering the market.

SWOT Analysis

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In this section of the plan we will present a SWOT Analysis where we discuss our strengths, weaknesses,

opportunities, and threats for Davidson Wealth Group.

For our strengths, a good first question to ponder is what advantages does our firm have? DWG

has the advantages to offer a mixed variety of services such as M&A’s, management consulting, financial

advising, and other services catering to individuals and businesses. A lot of financial firms either cater to

one or the other but our firm chooses to work with both instead to widen our reach and have more of a

diverse clientele. That is what consumers will also come to see as a strength in the market.

Every firm can be likely to have strengths along with weaknesses though. The positive economic

growth of the financial services market is good but it also means that there is a lot more competition to

deal with. A popular phrase that advisors do not like to hear from individuals I have learned is when a

customer says they are “shopping advisors”, meaning they are looking for the right advisor to choose. A

lot of cases, some customers will feel safer with bigger corporations instead of trusting a local firm. This

is why we also developed the business advising and financing approach to cover the risk of any customer

losses so we could expand the type of clients we could gain through various services we would offer

them.

Opportunities are becoming so vast in the market for financial service firms. The reason why

comes down to this: digital access. Digital access has been changing the pace and interface of the

industry. It works well for the stock market, it works well for commercial banks when a customer simply

wants to check the balance of a checking or savings account, and it certainly can have the same effects

for checking a brokerage account or life insurance policy with an advisor through the simple use of a

username and password. With access being so quick and easy due to rapidly changing technology,

customers can access their account information and examine all parts and learn much easier with their

advisors. The simplicity that these innovations provide will open up business much more in the market

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and customers will seek to hear advice from licensed advisors who can instruct clients or businesses how

to navigate their assets and or personal balance sheets so simply.

Industries all have other variables that can certainly come across as a threat. What we also must

do is examine the weaknesses we have and ask are they truly a threat to us? Well competition is not

necessarily threatening but it means that you are not running a market and selling your services to

another client in hopes they will remain with you, making the affair a matter of pure competition.

Competition is not necessarily a threat, but certainly applies pressure to the standards we uphold

because brand-name integrity is very important. So far we also know that changing technology doesn’t

harm us either, it does the opposite.

In conclusion, this brief SWOT analysis provides the implication that there is weaknesses with a

large market of competition because customers and businesses will shop advisors and or go to advisors

based on referrals of other colleagues sometimes too. This can stand as a threat, but the threat of

competition is always inevitable. Despite this, Davidson Wealth Group faces heavier advantages with the

strengths of a wide array of services to offer to not only people, but businesses too. Along with that, the

opportunities for better business is ever increasing with the newest of innovations of technology taking

place.

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Strategic Position and Risk Analysis

Davidson Wealth Group’s mission is to provide financial services to customers that not only offer the

most optimal choice and return on investment to a customer, but also to provide these choices with

pure simplicity because the financial system is very complicating. In order to do so this requires a labor

intensive environment where the employees have been tested sharply and have studied rigorously to

earn their Series licenses through FINRA that authorizes them to sell securities. Steps we would take to

help tap into an employee’s full skill set include:

Starting as an associate representative or research analyst to complete duties requested under

an advisor while studying the Series exams. These tests will become easier with the hands on

experience in addition to working with hands on experience.

Training employees in the latest financial software and how to navigate the new interfaces of

the technology so that it may be used to show clients clear results

Provide free referrals to the new advisor when they are only just starting to get warmed up to

building their own clientele

The technology for the market of financical services is rapidly changing. Back then, people used to not

have emails, and now they can make forecasts based on the balances of their assets and insurance

policies. This means that employess must be very adapatable to change because if not, the firm could

potentially lose business or mislead a client which can cost additional business even fi the mistake was

an unintentional one.

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Marketing Plan

For most companies, a marketing plan is very important because successful marketing has a positive

relationship with more successful sales. In order for there to be prosperity and life for Davidson Wealth

Group, we must have clients. Our employees would not have much work to do without having clients

because they are the key component that drives the firm to its success.

At DWG, we understand the importance of good marketing because we must be able to relate

to a customer so that we may build relationships and capture their attention. Ways that we do this is to

make the customers aware of the many services we offer that make us helpful and diverse as we pride

ourselves on that characteristic. But in order for us to truly capture their attention, they need to

understand the message we are trying to deliver top them. The message we want to be clarified to the

individual or to the business is that we are dedicated to finding and researching solutions to help us

track what your optimal choice is whether it be an investment into a treasury bond or a merger. Having

a genuine message to convey to clients why you would be their best choice is important because a big

marketing tool that we also value is word of mouth. In this business, referrals have the potential to build

our clientele in a much bigger network than before.

An important point of understanding about good marketing is going over the four P’s of

marketing and at Davidson Wealth Group we know how our four P’s can be explained. The first P is

Product. We sell products and services that are mostly intangible unless you decided to liquidate your

investments. Products and services range from life insurance, stocks, bonds, mergers, IPO’s, writing

financial statements, and retirement planning are part of what we offer and through our consultations

with each client based on your financial history and what you are seeking we will advise what is right for

you. The second P is Price. You are going to want some type of cost advantage with our products of

course, that being an ROI (or return on investment). Through our consultations we will show you why

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you get the best ROI on the products we recommend along with why it’s right for you. The third is Place.

Where ever we may be located there is always some advantage because no matter what community we

are located near, they will always need advise on their finances and based off of where we develop our

office site, we will tap into that community. The fourth and last P is Promotion. As stated earlier,

referrals have potential to really make a network grow positively. Besides involving ourselves in

community events, trade shows, online advertising (social media and affiliate marketing), and

sponsorships, we look at referrals as our most important tool of marketing. The great thing about

referrals is that it is word of mouth marketing which is also cost effective and a big variable in our

performance driven values.

In order to really succeed in quality marketing, we need a well put together staff. An effective

way, although it may be required is some areas, is sponsoring and encouraging our employees to get

more designations through FINRA to be able to sell certain securities. The more designations they gain,

the more they are able to do for our company and our clients too. We will also need workers who have

taken their CPA’s and acquire an experience accountant who can have oversight of all budget services

under a small group of other accountants. This structure would be added in the same fashion for the

analysts and advisors as we would appoint them as senior level employees with the CEO and chairman

of the company handling oversight of the teams.

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Operations

This section will cover in detail how Davidson Wealth Group operates mechanically, the production

process of services, and how the employees are trained.

Employee Training:

At Davidson Wealth Group, our operations structure has a strong foundation of training that we

use to develop every new entry level employee to our standards of performance. Junior analysts will

start out on a training program for six months where they work alongside the senior analysts to

understand our own code of ethics and analytical software and techniques of financial modeling. A

similar concept is used for our financial representatives. While training them to get enough experience

to meet the legal requirements to become a financial advisor, they will spend their first six weeks

studying for their Series 7 and Series 63 so that they can begin recruiting clients and legally licensed in

the state to sell securities and make recommendations. But the recommendations are limited since they

are not a fully certified advisor. They will then spend the next few years making sales, recruiting clients,

and assisting in casework with financial advisors because they must acquire 4 years of work experience

before getting certified. This is a rule required by FINRA. After the 4-year requirement, they can get

their ChFC (Chartered Financial Consultant) designation where they can begin working with their own

network of clients that they have recruited on the advising level. There are no training processes when

bringing on any accountants because we only need a few of them. With that being the case, we would

prefer CPA’s with more experience so that we don’t have any training costs.

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Production Process

When our advisors start dealing with new clients, the client will begin filling out paper work so that we

can make an assessment of their assets and decide a good step for them based upon income, assets,

and occupation. They will fill out their NETX paper work online which will be automatically into

transferred over to our balance sheet application. All of these services are done through a third party,

our registered broker, Park Avenue Securities in New York.

For our business consulting services, we have analysts that will perform due diligence when

initially starting to do business with them. We will then sign confidentiality agreements with our client

and also waive ourselves of liability whenever it comes to helping a business raise capital, organize

financial statements, make investments, or perform mergers and acquisitions. For our business clients,

third party involvement usually involves lawyers we hire when doing contract work for a merger. We do

not need third party for financial statements or auditing, as we have our own CPA’s.

Competitive Advantages

Although there are bigger companies that perform these services such as Raymond James,

Goldman Sachs Group, and Deutsche Bank, our firm does not lose out since our local relations give us a

foot up in the community. With our firm also operating on a smaller level, we incur fewer costs and our

services to companies and individual are less costly. Not to mention, our advisors being able to operate

independently outside of Florida gives us a big advantage that eliminates the need to pay for having

more buildings because the clients each advisor has is their own practice. Our business model makes us

a more elite firm because we can help a firm invest, raise capital and do mergers like some investment

banks do (even though investment banks still have plenty of other services like IPO’s). But we can also

work like an accounting firm by organizing financial statements and auditing. Our biggest function

however, is our asset management section where we have many financial representatives and advisors

recruiting, networking, and advising with many clients on the optimal choices for investment strategies.

This hybrid business model gives us a competitive advantage because we are addressing many needs for

people and businesses.

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Technology

An organizational key that makes the investment processes work for DWG is our financial software used

to organize clientele and business assets or compile data sets. We use software applications such as

NETX, Living Balance Sheet, and Gretl. Having these help us tremendously to organize and compile what

we need. The financial analysts will use software programs Gretl or Stata to run regressions and

forecasts to track and analyze investment patterns and behaviors for companies based on variables like

their historical prices or their investing habits.

The other side of the firm that deals with individuals uses different software programs like NETX

and the Living Balance Sheet. These financial apps are provided by our registered broker firm Park

Avenue Securities. Even though they manage our software, the advisors will manage and facilitate the

data given by their own clients. NETX is simply done to where the client fills out a request form, lists out

their finances and accounts all into one easy form of access along with a trading account opened with

DWG. The data is then also entered into the Living Balance Sheet where we can calculate your net worth

and examine each variable that goes into the calculation of your assets and liabilities.

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Management & Organization

Key Employees:

Cole Davidson, President/CEO. Before he founded Davidson Wealth Group, Cole Davidson made his

start working with financial advisors as a consulting intern at an asset management firm in Tallahassee,

FL upon finishing his degree at Florida State University. After achieving a masters in finance one year

later, he then went straight into working for the financial corporation, Raymond James as a junior

financial analyst advancing to the senior level within 3 years after countless work and making proper

recommendations and unseen error predictions to the seniors. As a senior analyst, Cole was very selective

about who his team was so that there could be little room for error.

About 6 years later, he became the financial planning manager for another 5 years where he was

in charge of the oversight of the senior analysts. But with realizing he could become the CFO, their CFO

was limited in his reach over what transactions he could make with the other executives having control

over other specific operations and that some were not even being utilized such as cost accounting,

auditing, and capital investment. When he realized that he could do everything Raymond James already

was doing and more, this is what essentially stimulated and peaked his interest start his own financial

firm.

The credible experience that Cole gained from Raymond James gave him the knowledge to know

what it took to get started and what he needed to do to be effective in the market. Davidson Wealth Group

is an S-Corp type business entity where Cole owns the majority of shares of his company and serves on

his board of directors as President/CEO.

Robert Evans, CFO. Robert Evans is our Chief Financial Officer. Before coming to Davidson Wealth

Group, Robert served as the CFO H.I.G. Capital, a venture capital firm in Miami, for over five years. The

CFO’s job is very challenging and requires experience with accounting, taxing, financial modeling and

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forecasting, mergers, and capital investment. Year end closes for all transactions with businesses and

clients are also a more stressful time for the CFO as his entire team under him can be busy.

Michelle Watson, CTO. With so many so many financial software applications that we use for various

business operations through our brokerage firms and partnerships with other tech firms, our Chief

Technology Officer Michelle oversees all technology related operations. With her 10 years of managerial

experience in General Electric’s IT Department, Michelle manages the relationships with tech firms we

use our technology with like the Living Balance Sheet or with our brokers in New York, Park Avenue

Securities so that we can have safely assure that online account operations.

William Ericson, Director of Agency Operations. The Director of Agency Operations has a very

tedious but important role for the well-being of the company. Requiring managerial and structuring

experience, William graduated with an MBA from Princeton University where he then worked with

Boston Consulting Group for over 13 years as an administrative management consultant. William

controls the training programs for the finance, accounting, and IT department and reviews them with the

trainers for each department.

Another key responsibility in Williams position is writing our financial and general business

policies along with the shaping of the human resource program.

Board of Directors

Cole Davidson is the Chairman of the Board and the CEO/President. Along with the CFO, CTO, and

Director of Operations, the company’s lawyer Kaitlin Bowe also serves on the board along with an

outside investor.

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President /CEO

CFO

Manager of Financial Planning

Senior Financial Analyst

Director of Operations CTO

Software Analyst Programmer

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Social Responsibility & Sustainability

Since Davidson Wealth Group has made it clear that we pride ourselves on better community relations

since we are not so much as a giant corporation, that also means we are proud to be involved in our

community. Since Davidson Wealth Group has different types of services offered through the firm to

people and businesses, we offer three different types of community help programs.

Our financial advisors are especially involved in the community with our program called “Save

Advice”. Every other Friday, we send our advisers to the local Boys and Girls Club chapters where they

teach the youth attendants there the importance of saving to make the first step towards financial

prosperity. The program gives us the chance to help this part of the community because the majority of

this group come from low income families. So by teaching these little bits of knowledge over time, the

children and parents accumulate free advice of basic financial principles that can benefit them one by one,

eventually generating some positive economic and financial growth.

The second is with our CPA’s and it’s called “Breaking Tax”. With this program we have two of

our CPA’s go to Tallahassee Community College once a week to instruct young part time workers or

young professionals how to do their taxes by themselves. When younger workers first get their tax

returns, we understand it can be easy to be mislead by longer and complicated processes of H&R Block

and Turbo Tax. So we think it would be best to freely demonstrate some of our knowledge to the young

employees so that their knowledge may grow and that hopefully they will also come to us for their own

financial handling or business consulting one day.

The third is our annual participation in the city’s Relay for Life event. Davidson Wealth group is

an annual sponsor to the non-profit organization to help provide some funding for cancer research. Every

year the company pays for a campsite and then pay extra to put our name up along with an extra addition

exclusively for the cause of cancer of research.

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Our goals for sustainability are kept pretty simply. Our firm is implementing a green initiative

where every trash can is required to have a recycling bin next to it and typically 60% less the amount of

paper we used is not printed and just used electronically instead. So far most printed papers we have are

just documents or contracts that need a signature of confirmation or authorization. This is not just a big

save for the environment, but it is also a big save for the company check book as it will save our company

a recognizable amount of money.

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The Finances

This subject area will be covering the financial forecasting’s and historical data sets for Davidson Wealth Group. At Davidson Wealth Group, we take success on making a profit on our first year since over half the businesses that are opened in America either fail or go negative on their finances because of larger overhead costs. The steps we took were no more than finding a reasonable investor and testing the needs for the new type of local firm in the industry.

INCOME STATEMENT

2015 2016 2017

IncomeGross Sales $525,000 $705,00 $1,200,560

(Advisors' Commissions) $28,000 $41,000 $101,000

(Returns and allowances) $0 $0 $0

Net Sales 497,000 $66,400 $1,099,560

(Cost of Goods) 56,000 $77,000 $99,720

Gross Profit $441,00 $587,000 $999,840

EXPENSES: GENERAL AND ADMINISTRATIVE

Salaries and Wages $152,000 $205,000.00 $275,000

Payroll Taxes $11,000 $21,000.00 $32,500

Professional Services $13,500 $21,000.00 $23,000

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Marketing $13,200 $15,000.00 $17,500

Rent $18,300 $28,000.00 $28,000

Equipment $21,000 $25,000.00 $29,000

Business Insurance $8,000 $9,200.00 $9,300

Utilities $3,200 $3,900.00 $40,200

Events $2,000 $1,700.00 $1,800

Travel $1,800 $2,200.00 $2,100

Maintenance $500 $970.00 $1,100

Technologies $7,500 $6,900.00 $7,100

Broker Fee's $2,500 $3,400.00 $3,900

TOTAL EXPENSES $254,500 $343,270.00 $470,500

Net Income before taxes 186,500 243,280 529,340

Provision for taxes on income 1,700 4,500 152,440

NET PROFIT $184,800.00

$238,780.00 $376,900.00

Our income statement has proven to show positive growth year by year as we begin with $184,800 and then grow to $376,900. With growing sales due to a client base that increases over time, our goals are to cut back on regular costs as much as possible even if the amount is smaller. We do this simply so that we can maximize our net profit after all expenses are factored out.

Balance Sheet

For Davidson Wealth Group

For Year Ending: December 31, 2015

ASSETS

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Current Assets

Cash $85,000

Accounts Receivable 33,880

Inventory 3,900

Other Current Assets 24,00

Total Current Assets $122,780

Fixed Assets

Land 0

Facilities 0

Equipment 24,550

Computers & Telecommunications 0

Less accumulated depreciation 2,100

Total Fixed Assets $22,450

Other Assets 0

TOTAL ASSETS $145,230

LIABILITIES

Current Liabilities

Short-term notes payable 29,600

Income taxes due 5,300

Other current liabilities 700

Total Current Liabilities $23,600

Long-Term Liabilities

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Long-term notes payable $34,000

Other long-term liabilities 0

Total Long-term Liabilities $34,000

Net Worth

Shareholder's Equity $56,800

Retained Earnings 0

Total Net Worth $56,800

TOTAL LIABILITIES AND NET WORTH $145,230

Our second visual representation shown about is of our balance sheet after closing out our first year.

SOURCES AND USE OF FUNDS

Total Dollar Amount Being Sought: Our firm is seeking $100,000 with a stake of 10%. Davidson Wealth Group is seeking only one investor with the privilege to serve on the Board of Directors and the assistance of guiding important and executive choices.

Funding Rounds: Davidson Wealth Group is planning on receiving just a singular funding round for financing. The company however is open to another investment should we expand.

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USE OF FUNDS

Capital Expenditures

Leasehold Improvements $10,000

Purchase of Equipment and Furniture 15,000

Total Capital Expenditures $25,000

Working Capital

Purchase of Inventory 10,500

Staff Expansion 40,500

Additional market Activities 14,000

Other Business Expansion Activities 10,000

Total Working Capital $75,000

TOTAL USE OF FUNDS $100,000

For starting up, Davidson Wealth Group is going to need $100,000 in up front financing initially. With our model being more service and transaction based, we have somewhat smaller costs to pay out unlike other businesses like manufacturing for example. The one investor needed would be able to secure their spot on our Board of Directors not only so that he may have influence with his investment, but so that he or she may be trusted.

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Appendix:

Work Hours: Standard hours of operations for Davidson Wealth Group will go from 8am until 5pm

Market Research: With a growth in demand, our market research shows that the excessive economic growth and demand for financial services are growing as the need for financial advice

Lists of Contracts Include: Employment, trading agreements, mergers, life insurance policies, accounting purposes, brokers agreement with Park Avenue Securities, Confidentiality of financial information

Works Cited: Some questions were taken and inspired from these additional sources.

Forbes. Forbes Magazine. Web. 14 Jan. 2016. <http://www.forbes.com/sites/thesba/2012/08/06/top-10-

questions-every-business-plan-should-answer/#2715e4857a0b21c7acab2561>.

"Going Solo – The True Costs of Starting Your Own Financial Planning Firm." Good Financial Cents. Web. 14

Jan. 2016. <http://www.goodfinancialcents.com/start-financial-planning-investment-business-firm-practice/>.

"10 Essential Questions to Ask Your Target Market." 10 Essential Questions to Ask Your Target Market. Web.

14 Jan. 2016. <http://www.foxonlinelearning.com/117.htm>.

"7(a) Loan Repayment Terms | The U.S. Small Business Administration | SBA.gov." 7(a) Loan Repayment

Terms | The U.S. Small Business Administration | SBA.gov. Web. 21 Jan. 2016.

http://www.hks.harvard.edu/m-rcbg/CSRI/publications/report_19_EO%20Finance%20Final.pdf

"How to Estimate the Cost of Starting a Business from Scratch | The U.S. Small Business Administration |

SBA.gov." How to Estimate the Cost of Starting a Business from Scratch | The U.S. Small Business

Administration | SBA.gov. Web. 21 Jan. 2016.

- http://selectusa.commerce.gov/

- http://www.tandfonline.com.proxy.lib.fsu.edu/doi/pdf/10.1080/13504851.2015.1078437

http://www.bengrahaminvesting.ca/Research/Papers/Athanassakos/Professional_Portfolio_Rebalancing.pdf

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http://www.tandfonline.com.proxy.lib.fsu.edu/doi/pdf/10.1080/13504851.2015.1078437

http://selectusa.commerce.gov/

http://www.hks.harvard.edu/m-rcbg/CSRI/publications/report_19_EO%20Finance%20Final.pdf

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completed business plan for davidson wealth group

Documents