Theo Chambers: Talent incubator

A technology director at JP Morgan; Vodafone’s lead architect; the director of UBS Wealth Management – Theo Chambers’ testimonials page sounds like the table plan of a dinner party in one of Sydney’s more exclusive suburbs. And that’s not far off the mark. Shore Financial, which Chambers co-founded with Alex Nochar in 2013, has developed a distinctive white-collar brand to suit its client base in Sydney’s lower North Shore and eastern suburbs. This was a brokerage whose move to a new office was specially covered by the Australian Financial Review.

It’s a brand that’s translated into success: Chambers made 2016’s Top 100 Brokers list, and he wasn’t the only broker from Shore. Furthermore, the brokerage was a finalist for Independent Brokerage of the Year (≥6 staff) at the Australian Mortgage Awards. Most impressively, Shore Financial is producing a new generation of talented brokers, many of them new to industry, with two finalists in the AMA Independent Young Gun category, as well as MPA Young Guns over consecutive years.

Shore’s DNA can be traced back to the careers of its founders. Chambers entered finance through retail banking at Commonwealth Bank. He trained as a lender within the bank, but “never really was able to sink my teeth into it”, being posted to a small branch in the quiet Sydney suburb of Lindfield.

Chambers first encountered broking as a customer. “Ironically, I was buying my first property at the time, and despite being at CBA I got my mortgage through a broker,” he says. “He got me a better rate and then offered me a job at the end of it.”

That broker worked at Oxygen Home Loans, a large brokerage that works with McGrath Estate Agents. Oxygen is also where Chambers met Nochar, who had a background in vehicle finance.

Oxygen added a new dimension to their approach to lending, Chambers recalls. “That’s where we really got to understand how a real estate agent operates their business and what’s important to them in terms of integrating into their business … how to be a value-add instead of being just an additional revenue stream.”

Being a value-add meant helping agents to find and sell properties, and providing an important conduit for open communication between agents and buyers, given buyers typically trust brokers more than agents.

High-end diversification
The broker-agent partnerships Chambers encountered at Oxygen are built into the fabric of Shore Financial. Among their partners are Sydney chains Richardson & Wrench and Phillip Pantzer Donnelley, and Victoria-based Fletchers Real Estate. “Generally we’d prefer a white-collar brand with white-collar clients because we’re a white-collar brand with white-collar staff,” says Chambers, “but those things are easier said than done.” A common problem in negotiating arrangements with real estate agents is that they want to own the loan book, whereas Shore looks for a profitsharing arrangement.

While most top brokerages now deal with high net worth clients, Shore’s white-collar brand is more pronounced. That’s partly by virtue of location: Sydney’s northern and eastern suburbs are home to some of Australia’s highest property prices and highest earners. However, Shore’s white-collar brand is more about what the brokerage offers than being just a method of picking clients, Chambers observes. “We wouldn’t have a target as such; it’s just anyone with a home loan. But our services probably are tailored to more affluent individuals, just because we can offer them more; we can do more for them.”

Shore’s offering could be described as high-end diversification. As Chambers explains, “more affluent individuals can get more out of our service, because we talk about things like tax structures; we’ve got three chartered accountants in-house”.

This diversified approach was there from the beginning, he adds. “We always wanted financial planning; we think the two products go hand in hand. We just haven’t been able to find the right financial planners as easily as we’ve been able to find the right mortgage brokers.” Lending is split 50/50 between owner-occupied and investment loans, although clients usually get a range of loans at  the same time rather than one after another.

Chambers also believes that Shore’s holistic offering beats the services offered by private bankers. “It’s never in their interests to give the best service or best overall loan service to an individual,” he says, “because the more they can rip off someone the more they can personally make … when we come up against them as a competitor, I feel we can always win that relationship quite easily.”

Another group that benefits from Shore’s educational approach is first home buyers. As many brokers in affluent areas have found, FHB clients often earn impressive incomes and have clear credit histories but struggle to get deposits together. Shore overcomes this obstacle in two ways, Chambers explains. “Most people end up getting assistance from parents, either getting a guarantor loan or just getting cash for a deposit as a gift. That comes back to the market we work in: most of them come from the lower North Shore or the eastern suburbs, and most of their families have got some money behind them.”

Brokerage to business
Shore Financial is now entering what is largely uncharted territory: the space between smaller boutique brokerages and larger interstate organisations. The brokerage has had a second office in Melbourne since 2014; in the next 12–24 months Chambers expects to open a new office in Brisbane. However, the biggest change has taken place in the Sydney office with the introduction of a new management structure, including making Chambers CEO and Nochar managing director.

Like most brokerage owners, Chambers and Nochar were already doing the jobs of CEO and managing director rolled into one. “We recognised each other’s strengths,” Chambers says, “and my strength was I was good at managing people and driving momentum; I was naturally already doing the role, but it was just about putting a label on it.”

Yet with almost 50 staff, 21 of whom are brokers, leading Shore has become a demanding affair. Spending more time working ‘on’ the business has had consequences for Chambers’ results as a broker: his Top 100 volume went down from $130,570,000 last year – putting him in 15th place – to $81,000,000 in 2015/16. Now he only deals with repeat clients and delegates work to his experienced assistant whenever possible.

In addition to Chambers and Nochar, the brokerage has brought on or promoted four other staff to work ‘on’ the business: a head of marketing, customer service representative, operations manager and learning and development coordinator. The latter, Chambers explains, “is a full-time resource for training new brokers … she’s been an assistant for two years writing big back-office volumes; there’s no one better to teach brokers how to process than her”.

Creating a full-time role for learning and development is a major investment even for a medium-sized brokerage and, combined with a tailor-made training program, underlines Shore’s focus on hiring
young talent. Chambers has no problem putting money into training staff. “We’re happy to do that, because we’re good at that to date, and we’ve been doing that for the last few years.” Furthermore, Harry Favetti and Paris Galombik, Shore’s Young Gun finalists at this year’s AMAs, do not come from broking backgrounds; both were approached by Chambers to do the job.

The biggest change at Shore Financial over the past year has been the introduction of a tailor-made six-month training program for new brokers. As well as doing their diploma and essential broking education, the brokerage’s high profile and 110-seat conference centre means that “we can have guests come and educate them on the pros and cons of buying an investment property and the hurdles they have ... and so on and so forth”, Chambers explains.

Shore Financial is one among a growing number of independent brokerages that are investing heavily in training and salaried positions in order to hire new-to-industry brokers, including Top 10 Independent Brokerages Alliance Mortgage Solutions, Iconic Home Loans and The Australian Lending & Investment Centre.

A finance background is not all-important to succeed at Shore, Chambers explains. “We do like the novices … they’ve got no bad habits that we need to break.” Instead Chambers is after particular personalities. “What I’m looking for is people with relationship-building skills, someone who can build rapport.”

He’s not against hiring bank retail staff but avoids existing brokers or bank lending staff. While top brokerages tend to take on potential brokers as assistants to current brokers, Shore is moving towards giving the new recruits more responsibility. “We’ll probably feed them with some leads … it’s probably good they do both [selling and processing].”

With a large number of young, ambitious professionals and a high degree of autonomy, the success of Shore’s young recruits is easy to understand. As Chambers sees it, “it’s a fast-paced environment; it’s very competitive amongst each other, and sometimes we just want to outdo each other”.

While Chambers and Nochar still lead the business, Shore’s restructuring has made the brokerage more of an independently functioning organisation, Chambers observes. “There’s five people working on the business, which is great … we can train and manage people a lot better.” With the training program in place, it’s time to get used to seeing Shore brokers appearing in MPA’s Young Guns report and collecting trophies at the AMAs. Shore will need every one of those brokers in the coming two years, Chambers concludes.

“I think expanding Sydney and Melbourne are the big ones, opening a Brisbane office in the next 12–24 months. There are 136 desks we have in the Sydney office that we need to fill!”

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