What I learned from ten years of cold calling
This week the big news in the brokerage industry was that, finally, the end of cold calling financial advisors is officially here…
I wrote a whole book about my experiences as a cold-calling stockbroker, including all of the scripts we were taught to use and all the methods employed to get people on the telephone excited about our stock ideas. It sounds so stupid now but in the 1980’s and 1990’s this was basically how the business worked. Some of the most successful financial advisors in America today initially launched their careers with a telephone and a stack of cold prospects to reach out to. Brokers built their clientele by smiling and dialing until they didn’t have to anymore – once they got big enough, referrals would come in and the firm they worked for would put cold callers underneath them to do the ongoing prospecting work. Potential clients were receptive to calls because they needed a broker to learn about what was happening in the stock market and to actually place trades. This was all before the internet and online brokerage sites.
Brokers could distinguish themselves by having interesting ideas, access to IPOs and other banking products and a winning personality. But you also had to have nearly unlimited chutzpah and absolutely no fear of rejection. You had to be clever. In his first book, Jim Cramer talks about being airdropped into random towns in Upstate New York and using microfiche in the local library to determine who the richest people were from newspaper articles. That’s what Goldman Sachs was teaching their young recruits in the early 80’s. There are stories of brokers gaining access to office buildings in Manhattan for a single client meeting, and then parlaying that into knocking on hundreds of office doors on dozens of floors to get even more meetings once you got inside. Edward Jones raised hundreds of billions of dollars by training its salesforce of brokers to knock on the doors of people’s homes. This is even more unimaginable than dialing people’s phone numbers in 2021 but there are still people out there doing it.
