Joanne Goodrich and Rick Livingstone are rarely more than a pocket door apart.

The two RBC Dominion Securities Inc. advisors are 50/50 business partners. An apt symbol of that partnership is the pocket door between their adjoining offices at the DS branch in Burlington, Ont., just west of Toronto. The door gives both partners a chance to step into the other’s office during client visits to illustrate points, or simply to iron out kinks in their business.

“I’ll say, ‘If you need anything, just holler at me’,” says Goodrich, 52. “Rick will say the same thing.”

Adds Livingstone, 44: “There are times when we are both in the review meetings; there are times when one of us will step in and out for 10 to 15 minutes as needed. We try to match the process with what the client wants and needs.”

Goodrich and Livingstone, who both have been in the financial services business for 10 years, have been in a formal partnership for the past five years. Their approach to running a business together and providing financial advice to clients has proven successful — in terms of revenue, efficiency and client satisfaction.

It’s not unusual for advisors to work in teams, but the specifics of the Goodrich/Livingstone business are rare, as far as they know. Goodrich and Livingstone share everything 50/50: revenue, costs “and every error,” they joke. The details of their business model and their success were in the spotlight during their presentation at the 2008 Top Advisor Summit in Toronto in June.

On paper, each client is assigned to a lead advisor, based mostly on the early affinity the client shows for one or the other advisor. A client meeting generally begins with both partners greeting the client, at which point the lead advisor takes over for the remainder of the meeting. The other partner may add occasional input.

Livingstone and Goodrich both unequivocally attribute their success to the partnership, which began first as informal non-revenue-related teamwork when they started at DS in 2000 within six months of each other. “It was simply that Joanne needed help with a client, and I would say, ‘I can help you’,” says Livingstone, who obtained an MBA with a specialization in finance from Concordia University in Montreal in 1996.

Help then travelled in both directions for months. Livingstone, the hard-core number cruncher, can find fine-tuning an Excel spreadsheet relaxing. His expertise is in tax-efficient planning, income creation and investment opportunities. Once the partnership became official, he took on the annual review of all their clients’ financial plans, including investment portfolio losses and gains. He is the business manager for the partnership.

Although Livingstone specializes in the more technical investment analysis, that’s not solely his role. He shares investment philosophy with Goodrich, and they’re both adept at portfolio strategy and construction.

“We’re both interested in it, and we overlap,” says Goodrich. “And because we both retain primary relationships with clients, we both better be good at it.”

In addition to Goodrich’s fiduciary duties, she tilts toward client communication. She organizes dinners and appreciation events for top clients three times a year. She has developed a series of seminars on behavioural finance and portfolio theory, a special interest of hers. These are all part of the business-retention and development strategies that fall under her watch, along with responsibility for long-term care insurance ideas.

It was when the partners joined their practices legally in 2003 that they began to see 30%-40% growth every year. The partnership has reached $180 million in assets under management, representing about 180 households. “The growth has been exponential,” says Livingstone, “sort of.”

Both Livingstone and Goodrich had risen to academic heights before they became advisors, and it is no surprise that they value education — for themselves and for the clients — as an integral part of their practice. “Education was a great theme at the conference, and I’m glad that came up,” says Goodrich of the Top Advisor Summit.

Goodrich was an honours undergraduate at the University of Toronto before she took a rare North American Commonwealth scholarship to study for her master’s degree in African history at the University of London in Britain. She finished the degree in 1980.

Before Livingstone earned his MBA, he graduated at the top of his class with a degree in mechanical engineering from the University of Waterloo in 1988.

@page_break@Both partners acknowledge that such academic achievements boosted their confidence in each other at the beginning of their relationship. They each completed the three-year rookie program at DS, with both easily reaching the milestone of $1 million in AUM. “We were well past that when we put our practices together,” says Goodrich. “We were both successful in our own right.”

DS insisted that they show their individual mettle, to the firm and to each other, before they made their partnership legal. They both appreciate that now, even though they may not have at the start.

The success and quick growth of the partnership can be partially attributed to simple business-management techniques. The partners share the cost of two team members: senior administrative assistant Zana Santini; and Charmaine Savage, who helps execute marketing strategies and plan events. And, equally important, Livingstone and Goodrich boost productivity by concentrating on their personal interests and strengths, which complement one another.

“We’re able to divide up all of the things we do and spend time on the things at which we excel,” says Livingstone. “Having a partnership has allowed us to do that and not worry about other parts of the business. I don’t think you get that same dynamic with a junior/senior or inside a team, because you’re still responsible for all parts of it.”

Balance and equity is part of the formula. Goodrich says their equal revenue-sharing ensures that each is equally committed to creating something of greater value than either could have produced alone. As business ebbs and flows, she says, each partner has to believe that he or she has contributed as much to the pie as the other has: “In a 50/50 partnership, that’s a lot easier.”

The partnership agreement outlines how to undo the partnership, says Livingstone, but the partners don’t dwell on that. Instead, they focus on day-to-day management of incremental duties as they arise — what they call the “soft contract” — such as responding to a media call. They get together to talk about these details occasionally over coffee or beer.

“The practice has changed a lot since we started,” says Goodrich. “It’s much more interesting and more dynamic the more we do and the more we know.”

Other details keep the business on solid ground. A mediator — simply someone who understands their business — has stepped in once to reflect each partner’s voice. This small intervention served them well, and they recommend that anyone considering a partnership enlist similar help from a senior peer or branch manager. A succession plan isn’t in the works yet because they consider themselves too young to address that topic immediately. They’ve informally named potential replacements in the event of a disaster and they have key-person insurance.

Outside the office, they don’t spend a lot of time together. “We have deep commitments to family,” says Goodrich, who has two teenaged sons. Her life revolves around their activities and community interests.

For his part, Livingstone plays hockey and helps organize Ribfest, a Burlington charity event at the end of summer that is the country’s largest barbecued ribs cook-off. He also attends with his wife and their seven-year-old daughter. IE

IE:TV — Building business in a partnership of equals