Welcome to our founder lessons series.
This week, Michael and Gerard share how they co-founded Boon Brokers, an independent mortgage, insurance and equity release brokerage.
Tell us about Boon Brokers
Boon Brokers is an independent mortgage, insurance and equity release brokerage based in East Anglia. Our independent and directly authorised status (FCA no: 301141) allows our staff to advise and arrange cases on a whole-of-market basis. This means that, where other brokers may be restricted, we can identify the most suitable lender/product in the UK for our clients’ requirements.
Our brokerage has over 60 years of experience in the industry – yet we are always seeking to innovate with new technology/systems to enhance the clients’ experience of our process. A core selling point of the company is that we do not charge any client fees for mortgage or insurance cases.
All mortgage brokers in the UK are paid a ‘procuration fee’ by the lender upon completion of a mortgage application. This procuration fee is sufficient to cover our costs. According to the government’s Money Advice Service, consumers can save an average of £500 on broker fees by using Boon Brokers services.
In addition to this, free home consultations are provided in Norfolk/Suffolk and our staff will automatically review your mortgage options when an opportunity to re-mortgage, for cost-saving or capital raising, arises.
Why and how did you start Boon Brokers?
The co-founders of Boon Brokers, Michael and Gerard, founded the business with a clear vision. This vision is to offer the cheapest advice and arrangement of financial products whilst simultaneously providing the highest quality of advice in the UK market. A strong driver of our motivation to start the business was that we noticed vulnerable consumers, with limited financial knowledge, consistently being taken advantage of by numerous brokers in our region.
There are many brokers that charge clients a fee (often £500) even if the case does not complete. In our opinion, this is an unethical practice. For this reason, with all of our services, no client fee is ever charged if a case does not complete. No client fee is charged, period, for mortgage or insurance cases.
Another driver of our company launch was our observation of the lack of technological advancement in the industry. Many brokers are still using obsolete technology from 15+ years ago that is now deemed inefficient in many other industries. Our team, which comprises a blend of youthful energy and experience, constantly invests in new technology to enhance our market offering.
In order to establish a financial service brokerage in the UK, the firm must be approved either directly or indirectly by the Financial Conduct Authority. Boon Brokers, formerly known as Business Matters, was approved for directly authorised status by the FCA many years ago. After directly authorised status was achieved, we invested in: the training of our staff, marketing for lead generation and technology to ensure a high-quality service. We have expanded on those initial investments ever since.
What has been the biggest success factors?
The biggest success factor, without doubt, is the premium level of financial advice on offer. Our Trust Pilot reviews are testament to the level of service offered by Boon Brokers. The single most important function of our business is to consistently offer the highest quality of advice available in the UK market.
As a result of our premium advice service, we have witnessed an increasing number of client referrals on a daily basis. The vast majority of our business is generated from word-of-mouth referrals. The business is now at a phase of ‘critical mass’ in which growth will be exponential, due to the high number of daily referrals, as long as the level of advice stays at a premium level.
Through various quality control and training tests, we ensure that the level of advice offered by our advisers remains at the highest level. In addition, no client fees for mortgages/insurance, free home consultations and whole-of-market access has significantly increased our enquiry numbers.
What are the biggest challenges you have faced launching and running the company?
The biggest challenge that we face is setting aside time to focus on scaling the company. As our business, if growing rapidly, all of our staff are functioning at almost full capacity. Therefore, it is difficult to take a step back and reflect on our growth in order to identify the best route for expansion.
However, we have recently allocated time slots throughout the week to focus on our marketing, operations, recruitment and financial objectives. This new time management practice should reduce the challenge of ensuring the optimal scaling of the business. Another challenge is financial.
As we are constantly re-investing in the business, it can take many months for us to see a financial return. However, as mentioned in the next paragraph, we stick by the principle that a focus on adding value is the most optimal way to expand a business. Therefore, we are happy to endure any financial worries that naturally arise from large investments in order to add value to the business.
Final words for aspiring entrepreneurs?
If you are hoping to run a successful business, focus on value creation. Do not “chase the money”. I see so many budding entrepreneurs base all of their decisions on maximising short-term cash-flow. Revenue figures will organically grow as a by-product of a high-value market proposition.
Many entrepreneurs chase money by, for example, expanding too quickly or significantly reducing their costs. These sorts of rash decisions often lead to a worse value offering for the firm’s target market. Therefore, if you focus only on adding value to your target market, your business will remain focused on its core objectives. Growth is far more attainable with a focused mindset on value creation.