Charles Schwab recently released a survey of 201 brokers conducted late last year. While the survey was mainly centered around questions about brokers’ attitudes towards becoming an RIA or turning independent, I thought the survey highlighted a lot of good reasons why I believe the Spoke Fund® model I use truly is a superior way for clients to invest.

The most telling chart, I thought, was the one below. (Click to enlarge.)

More than 52% of brokers thought that corporate goals were taking priority over client goals and 38% thought that there was too much focus on selling special proprietary products.

The other interesting survey finding was that 79% of brokers found themselves having to explain more things in conversations with clients because of their connection to Wall Street firms. It’s no surprise that something like this is happening as Wall Street’s behavior has become increasingly egregious and the regulatory agencies are doing little to stop it. The never-ending stream of settlements over abuses tied to subprime mortgage products that were usually marketed to institutional investors are bad enough. But much of the bad behavior affects advisors’ clients as well. This recent settlement involving Morgan Stanley Smith Barney shows how the firm marked up corporate and municipal bond prices 3% to 8% over the market price when it sold them to clients (or marked down by 3% to 8% when it was buying them from clients).

Of course you may think your broker is watching out for you, but the survey shows that is not the case. While most brokers present themselves to clients as experts on managing investments, only one-third (or 34%) actually manage their client’s money. Most of the investment management work is simply outsourced to a third party (adding yet another layer of return-killing fees) or handled by the corporation for which they work.

It is surveys like these that show why I’m proud to be a Spoke Fund® manager and not a broker at a large Wall Street firm. My interests and my clients’ interests are aligned, and I can do what is best to manage their investments. More than that, unlike many advisors who work in the industry, Spoke Fund® managers are actually managing their clients’ money. Clients know who is ultimately responsible for investment decisions and that there are no hidden fees or hidden agendas.

Apologies for the long break between posts. I’ve got all kinds of excuses, really.

That said, time to knock some of the rust off. Let’s start with some updates.

On my end, my firm got registered in a new state (Texas) late last year, which was a good experience in that it sparked a re-thinking of some performance measurement processes and the old online sales funnel. After talking to a couple of consultants in an attempt to bring in expertise to design some pre-GIPS standards for performance advertising, I realized that I might be in the wrong business. Those guys charge a ton. Even crazier, people appear to pay it. Suffice to say I am still looking for a better/cheaper way to pin something down and will share some thoughts there as soon as I can.

That issue of performance measurement and advertising is also one of the last big topics I want to include in the slower-than-a-glacier-effort that is the Spoke Fund ebook. So although that, too, has been hovering over my head for far too long, I’m cautiously optimistic that I can finish that before long (read: “before the iPad 29 is released.”)

Also, here on SpokeFund.com, it will soon be possible to create private message boards. Among other things, that will enable us to complain in private about, say, prospective investors who call in asking if they can buy shares of the Facebook IPO through your firm.

Sigh. We still have so much work to do.

Other news in the Spokester Universe:

- Steve Kiel is launching a hedge fund. And here is his new blog.
- Kevin O’Reilly continues to find them divvies and was the axe quoted at length in this magazine article.
- Prospective Spoke Fund manager Adib gave this presentation on risk management.
- Here’s John Rothe on why he walks the walk when it comes to investing in his own fund.
- Adam Welch did a soft-launch of his Spoke Fund™, complete with cool website.
- Ryan O’Connor is now a managing partner of Whetstone Capital Management.
- Ryan and Adib both were named on this list of top 21 investment blogs.
- Eugene Huang launched his blog at www.valueinvestorMD.com. That’s MD as in medical doctor, slackers.
- Trond Hildahl got his firm registered in Cali.
- Dustin has knocked down the 65 and is getting set-up with Folio, too.

I heard from three new potential Spoke Fund™ managers in January, and there are a number of good threads on the boards that I have yet to catch up on.

I know I also missed posting a number of monthly and year-end letters from you all.

What other news am I missing?

Update: I forget to mention this, my favorite recent tweet from Ben Strubel. Or maybe it’s this one.

Jack Bogle:

“I suppose if I was to reflect on it…I would hope that out of all this would come a major change in the way the financial investment business in the U.S. operates – to go away from speculating and toward investment, which serves everybody but Wall Street. Wall Street is too big a part of the equation, and we need to get them out…[we need] funds you buy and hold that don’t get tempted by the machinations of the market. And so the big thing would be a slow, probably quiet revolution to return to the basics of what investing is all about.”

This morning Seeking Alpha published a greatly expanded version of the quick case I made for high conviction holding Clearwire at FundLaunch.

Here’s a snapshot:

Through the deployment of a network covering 135 million people, Clearwire has begun to gain significant momentum in the monetization of an asset that is unmatched in its industry – deep, wide, clean spectrum.

Shares are temporarily depressed due to elevated uncertainty about a number of tactical issues which will soon be resolved.

Shares now trade at $2.54.

Using conservative assumptions bordering on the pessimistic, per share intrinsic value is likely between $4 and $6, depending on the eventual terms of a pending $1.0 billion capital raise.

A more objective and analytically justifiable valuation of their spectrum puts shares closer to $16. That higher valuation has also been independently corroborated by the work of a well-respected value investor who appears to have been recently accumulating more shares.

Clearwire’s spectrum constitutes a margin of safety. There is a significant probability of large gains. New management is competent enough.

The former interim CEO and now Chairman, John Stanton, bought $5 million worth of shares on the open market in August.

Prior insider buying by Stanton as CEO of both Voicestream and Western Wireless resulted in phenomenal, multi-bagger returns. Several near-term catalysts exist.

You can read the rest in its entirety here:

“A Value Investor’s Case for Clearwire.”

And shoot me an email if you’d like a copy of the model.

Disclosure: Long CLWR. The above in no way constitutes investment advice. It is for educational and informational purposes only. Nothing contained here or on Seeking Alpha should be construed by anyone as an invitation or solicitation to buy or sell any security.

Attention fellow cheapskates: RIA in a Box has announced they’ve launched a new service – Compliant Bookkeeping Services.

As per the below, they can handle just about anything a start-up Spokester might need on the Quickbooks front…all with an eye towards keeping you compliant, too. So, it’s a unique combo – for as low as $39 a month.

More in the below. And if you decide to give it a whirl, please keep me posted on how it goes, eh?

As of the last count, there will be 15 people attending. The event is being sponsored by FOLIOfn, who will have a rep at the conference, as well as RIA in a Box. Many thanks to both.

A handful of notes:

- If you are flying into Fort Myers airport Sunday afternoon around 4:00pm, and would like to share a cab to the hotel, or a rental car, please let me know as soon as you can. Same deal if your flight out on Tuesday is around 7:00pm.

- Sunday night at 7:00 I’ll be grabbing some dinner at Quinn’s on the Beach. It’s a little cafe right there on the resort property down by, well, the beach. So if you’re coming in Sunday, come on by.

- We’ll begin at 9:00 Monday morning in the “Caxambas” conference room, which is near the main lobby. Doors will be open at 8:30 if you want to grab coffee first.

- If you’d like to present a “high conviction investing idea” to the group on Tuesday morning but haven’t already told me so, please shoot me a quick email. About fifteen minutes is fine, and you can present with or without slides.

- Similarly, if you’ve been running your fund or your RIA for a while now and have some lessons learned and/or pitfalls you’d like to tell others about, please let me know that, too.

- Lastly, the Marriott we are in is the Marriott Beach Resort on 400 South Collier Boulevard. Apparently there is another small Marriott somewhere on Marco Island, but the big one on the beach is ours.

Looking forward to it, and see you soon. Here’s my email again, and my cell is 305-522-1333.

Cale

Here’s one of the best things about all this volatility in the market lately:

It’s a great time to start a Spoke Fund®.

Along those lines, I’ve got a handful of things to report about the Spoke Fund conference coming up September 12th.

1. I flew up to Marco Island a few Fridays ago and got the formal tour of the Marriott where we’ll be hosting the conference. It is, simply, gorgeous. I am fired up. Again, please bring the wife and/or kids if you can. They’ll love it.

2. I’ve decided to formally start calling this thing the “FundLaunch” conference. Bit easier to brand that way, I think. So you may see that term being used quite a bit from now on. And that makes this the inaugural FundLaunch conference which, of course, you simply cannot miss.

3. I’ve also got a new registration page where you can sign up to attend. Please register for the conference right here on this page.

Here’s a rough agenda of topics we’ll cover during the conference:

Monday, September 12th Agenda:

Introduction to Spoke Funds
How to Prepare for Launch
Launching your Spoke Fund
Productivity and Technology Tools
Compliance and Administration
Marketing

We’ll run from 9 am to 4pm that day, with a break for lunch. We’ll also have a killer cocktail reception up in the penthouse suite that night.

Tuesday, September 13:

Lessons Learned & Pitfalls to Avoid
High Conviction Ideas

Tuesday will run from 9am to noon, so you’ll have time to catch a flight in the early afternoon. And that last bit, the High Conviction Ideas session, will feature conference attendees giving an overview of one of the highest conviction stock ideas they’re currently invested in. Assuming you’d like to, of course.

So at the very least, you oughta come out of this thing with at least a couple of good investing ideas. I think in reality, you’re going to leave with a whole lot more.

Please see my last post for details on making reservations. And here’s the latest brochure on the conference.

Finally, there are limited sponsorship opportunities available if you’d like to get your company in front of the next great portfolio managers. Please email me for details.

More in a bit. Hope you can make it!

Just a quick note to officially confirm that the 2011 Spoke Fund® Conference will be held on Monday and Tuesday, September 12th and 13th, at the Marco Island Marriott near Naples, Florida.

So, it is on.

Other details:

1 – To reserve a room, call (800) 438-4373. For reasons that I’ll get into later, to make room reservations, you’ll need to do two things: (1) tell the reservations people you’re coming in for “The Hardware Conference,” and then (2) let me know you’ve done that (via email or call). I know, it’s odd, but that way room rates should be about $157 a night for ya – which is terrific for this place. There is a little more background on that Hardware Conference reference here, but for now I’d say trust me, and I’ll connect the dots later on for you.

2 – The nearest airport is Fort Myers Southwest Florida International Airport, and I believe the code is still “RSW.” Got a handful of options for carriers, including Southwest, American, United and JetBlue.

3 – You’ll have those favorable room rates available from September 7th to the 15th…so if you want to fly in earlier and/or stay later with the spouse and family, please do. The hotel is very nice and you could certainly make a mini-vacation out of the trip if it’s in the cards. That hotel site again is www.marcoislandmarriott.com.

4 – The conference will start the morning of Monday, Sept 12th, and we’ll have a full day of presentations there – plus cocktails that evening up in the penthouse suite (bar and apps). The full agenda will be formalized soon. We’ll also have a half-day on Tuesday, Sept 13th, and at this point, I’m thinking we can make that the “Highest Conviction Idea” day, instead of focusing on spokes. And by that I mean everyone who wants to have the floor can get up and walk us through the highest conviction holding you have in your portfolio. So if nothing else you’ll walk away from the conference with some solid investing ideas. All of that is the good news. The bad news is…

5 – There will be a to-be-determined registration cost for attendees. (Consider this the cost of a ticket to get in). I gotta offset my costs, and I have some feelers out for sponsorships, which is how I’d prefer to finance this thing. But whatever gap there is between that and breakeven will be made up by registration from attendees – to a degree. I’m aware you’re all cheapskates, too, so while I don’t know the exact registration costs yet, I will cap it at $200.

In any case, more on all of this soon. Just wanted to emerge from the cave and tell everyone that the conference is officially on, and that it should be a great time.

Also – I am on vacation currently, at least in theory…typing from high in the Rocky mountains. My plan is to formalize all the above more next week when back in the office. That will include online registration, a more formal agenda, etc. But pls fire away with comments and/or questions in the board in the meantime. Appreciate the patience as usual.

And regardless of my own schedule here, I am obviously feeling the urgency to get this all nailed down given the timeline – and I am pumped about the conference. Marco Island will be a helluva leap from the old dynamite warehouse last year…

Hope to see you there. And don’t forget – it’s all tax-deductible, hoss!

Any big picture things that I missed in the above?

Here are three things I wished I’d done differently when first setting up my Spoke Fund and my firm. This is certainly not an all-inclusive list, but these in particular have come up recently in conversations with prospective Spoke Fund managers.

1. Having a good CRM (customer relationship management) tool on day one.

At the end of 2008, I got an email out of the blue from a reasonably well-known fund manager whom I admired. He’d somehow seen the positive plug I gave his mutual fund company in this slideshow and was basically checking in to say, “thanks and good luck.” I thought it was extremely cool.

It also led to a ten minute phone conversation, during which he asked about the Spoke Fund model, my philosophy, and referred me to someone else he thought I should talk to. Near the end of the call, perhaps sensing he had driven most of the conversation, he wondered if there was anything I wanted to ask him. So I asked, “What’s the single most important piece of advice you’d give to someone just starting a fund?”

I was hoping his answer would make time stop and the seas part – you know, that he would bestow upon me the sort of unfathomable wisdom only available to a salty veteran who managed billions of dollars of other people’s money.

Instead he said this:

“Get yourself the best CRM tool you can find, because you’re going to need it.”

After scratching my head for a bit, I went out, swallowed hard, and spent $1200 on Salesforce.com…and then proceeded to bang my head against the wall for two weeks trying to figure out how to tame it. After that, I quit out of pure frustration, and really soured on all CRM tools in general, for about a year. Nothing I couldn’t do myself a lot cheaper with a spreadsheet and Post-it notes, I figured. Never mind what that grizzled old-timer had told me.

And the truth is that I really didn’t need a CRM tool that first year to help land my early investors. They were going to invest, regardless. But that circle only gets you so far, and I blew some chances early on to expand my early investor base outside that friends-and-family group because I had too much going on and no good way to track leads. Now, in year three, and having just spent a sporadic three months working on and off with my VA to finally get my CRM program updated and really making it an asset, I am kicking myself for not having that tool up and running earlier. Like, much earlier…meaning on day one, just like the man had said.

I have blown a not-insignificant amount of business by not being better organized about responding to leads and prospects, period. And that wasn’t really obvious until I’d looked back. If I’d had a really good, up-to-date tool, my business would be further along.

So, entering that stuff initially into a CRM system can be a bit tedious, and it will seem a bit unnecessary at first, but if I did it over again, that would be the first thing I’d do differently. Start on day one – not necessarily because it will bring investors in the door right away, but because it’s important to have a system that you have full confidence in when it comes to maximizing the opportunities to have real conversations with people who could become investors.

Finding new investors can be a real grind, and at various times I think the process makes everyone at some point flop dejectedly onto a couch and ask themselves, “What can I be doing differently here?” And while I’m not sure I know the exact answer in every case, I do think that in many cases that answer probably starts with, “Get a real process.” And that means CRM.

And as I’ve mentioned before, now I use Highrise by 37signals as my CRM system. Much better, simpler and cheaper than Salesforce. Probably worth more of a discussion down the road.

2. Combine my blog and my website.

This is a more recent revelation. As background, I have two sites for my business…the main company site at www.islainvest.com and my blog which is hosted at its own domain at www.caleinthekeys.com.

The reason I have two sites is that, basically, I wanted to stay local in picking the firm that designed my website. Alas, at that time (three years ago), they couldn’t quite figure out how to easily integrate the look of a blog with the rest of the site that I wanted. So I just went out and did the blog independent of my firm’s site. And in what may be a prime example of confirmation bias, that separation has made sense to me over the years – because it enabled me to do some things on the blog I probably wouldn’t do on the website. Like bragging about bonefish, for instance.

Turns out, though, that I get a lot more traffic to my blog than I do my main website. For a handful of reasons, my Google juice is higher for the blog. And as I’ve started talking to some SEO guys about a handful of online marketing things I’m considering, they have each in so many ways said the same thing:

My main website would be showing up a lot higher in Google searches if my blog was hosted at www.islainvest.com, instead of being a separate domain. Significantly higher.

There is a lot more to search engine optimization, keywords, backlinks, etc. than I will probably ever know, but this particular combo seems like a no-brainer given that had I done it earlier, (1) I’d have been saving money on hosting just one website instead of two and (2) it would have produced much better results in Google – which would likely have lead to more investors.

So, save money, more investors. Gotta consider that, no?

It’s hard to guesstimate how much of that additional re-directed traffic would have actually resulted in new investors over the years, but I’m pretty sure it would have resulted in more sign-ups for my email list, and as I’ve mentioned before, that has really been my top sales tool. And now, to combine the two, it’s going to cost some bucks.

So, again, with the benefit of hindsight, I’d have done that differently. Plus WordPress templates are pretty amazing these days, so it’s all easy enough to do cheaply right out of the gate.

3. Monthly, not quarterly, billing.

I made this change after my first year, and am thankful for it. I originally launched my Spoke Fund under a quarterly billing plan, meaning FOLIO deducted my fees from client accounts and forwarded them to me four times a year. At the time, a quarterly plan seemed to me to be something that investors might prefer, as it meant that my fees were tied a little closer to the performance of the portfolio. If the value of the portfolio rose that quarter, I’d make more, and if it fell, I’d make less – which is about as close as I could get to charging any kind of easily scalable “performance fees” when it came to non-accredited investors. Also thought quarterly billing would underscore that I wanted my investors to be thinking long-term.

Thing is, nobody cared. Really makes no difference to my investors if I bill them quarterly or monthly – but it can make a helluva difference to your firm in terms of cash flow when starting out. My investors are much more concerned with performance and bips charged than the timing of those fees…which seems obvious in retrospect, but hey, when you’re starting out, ya need all the friends you can get.

So, what seemed like a more investor-friendly billing schedule was really just something I’d over-thought. Better to get paid every month early on.

Any other lessons learned out there?