Every weekday morning, Josh Brown's alarm clock goes off at 5:30.
By 6, he is showered and dressed and sitting at his computer working on his two daily blogs.
The first, for The Wall Street Journal, is directed at financial advisers and must be turned in to his editors by 7 a.m.
His main blog, aimed at investors, takes shape on the 90-minute train ride from his home on Long Island to his office in midtown Manhattan. Throughout the day, he updates the blog,
TheReformedBroker.com, a minimum of eight to 10 times, depending on breaking new events.
It is fair to say that Mr. Brown, 35, has embraced social media to a greater degree than most other advisers. (You don't attract more than
on Twitter passively.) In return, social media has embraced him, leading to a measure of renown in financial media circles.
In addition to his blogs, Mr. Brown writes a column for Forbes.com, is a frequent guest on CNBC and has just written a book, “Backstage Wall Street: An Insider's Guide to Knowing Who to Trust, Who to Run From and How to Maximize Your Investments” (McGraw-Hill Cos., 2012).
After spending 12 years as a retail broker, he works for a registered investment advisory firm, Fusion Analytics Investment Partners.
Nearly all his new clients come to him as a result of his blog or though referrals from people who read his blog, Mr. Brown said.
The following is an edited interview conducted at his office June 7.
Q. How did you first get involved in social media?
A. Before there was social media, I was keeping myself educated by reading and curating all the news stories each day and relating the details to my clients. One day in 2008, on a lark, I got a WordPress account and put together my first blog post. I showed it to my compliance officer, who promptly had a heart attack. Then, working with compliance and owners of my firm and speaking with the advertising bureau at the SEC, we figured out a way I could get started, and the rest is history.
Q. Some advisers have been successful using LinkedIn and other sites to generate client leads. Do you do that?
A. I'm on LinkedIn, and I'm sure if I wanted to turn things around I could use it offensively and try and network with people. But what I'm doing with social media is sharing thoughts and opinions. I'm fortunate I have an audience. They read me and they understand my thoughts on things and that leads to business, but that's not the intent. I didn't start the blog to say what a great ad it could be.
What I do on Twitter is not trolling for business; I don't care if anyone contacts me.
Q. Can you take me through all the varied elements of your social-media efforts? You have something like 20,000 followers on Twitter.
A. It's 24,000. But every social-media thing I do is meant to drive people to the blog. You can't really get across what you want to get across on Facebook, on LinkedIn or Twitter. These services are great for engaging with people, but you can't make points that matter anywhere else but on the blog.
Creating content on Facebook or LinkedIn is insanely stupid. You don't own it, it's on there, but not under your own banner. It cost $13 to buy a domain name. Why wouldn't every adviser using social media have their own blog? There are no reasons not to, and the reasons to do so are so compelling. So I think when people talk about social media — “I sent 500 tweets, why didn't I get any clients?” — it's because you're not establishing anything. Tweets are disposable. The average lifespan of a tweet is less than two minutes. If you're not doing something more permanent in your own space, social media is not going to do you any good.
Q. What kinds of mistakes do people make when it comes to social media?
A. Some people are doing it right, but they're at their own firms. It's a huge mistake that the biggest firms have been so slow to adapt. I know they're trying. I think Raymond James is doing a good job. The people running the pilot program at Morgan Stanley are really doing their best. They're allowing brokers to be on LinkedIn — which is great, it makes sense, it's a natural fit. But what they don't understand is that the adviser should have his own page somewhere, even if it's on the corporate site, and all of the social-media services should be used to drive people there; that's where they can have their contact information.
Unless you do that, everything you do is just chatter, and the shelf life is very short. All of these firms should have chief blogging officers. The brokers should take the spiel they use to talk to prospects and clients and put it in print and have it somewhere as a record of what they think at any particular moment — not the direction of the market but just something that says, “Hey, today was a tough day in the market, and this is what I told my clients.”
Q. Do some firms use the compliance issue as a crutch for not becoming more involved in social media?
A. I think it's a valid point and really scary for large firms. There are a lot of risks. And I respect that. But they have to grow up and get over it. The rules are not any different than they are for any other type of public appearance or advertising. You can't make guarantees, you can't cite track records or performance results, but these are all things that you can't do in an e-mail or a form letter or a radio show. So why does everybody think this is more difficult? The average age of an adviser is 49. So can't we trust these guys not to do something that violates firm policy?
Q. You have compared social media to where e-mail was 10 years ago. Can you expand on that?
A. When I started in the business the summer after college, I was at a brokerage firm whose principal held an impromptu meeting one day and said, “I just want to talk about this e-mail thing.” Everyone hushed. “We're not going to do it.” That was the meeting.
Some time went by, and we got a new e-mail policy: “You have to type up what you want to say in the e-mail. Print it. Bring it to a branch manager. They have to sign it and put that thing in a file, and then you can send an e-mail through the firm's account.”
That morphed into, “We give up. Everybody gets an e-mail address, but you have to blind-copy compliance.” And then the technology got better, and compliance could automatically archive it. And then they finally said, “Here's the 900-word disclaimer that goes at the bottom of all e-mails, and just know we're watching you like a hawk.” By that point, e-mail had become a legitimate business tool, with some clients preferring e-mail to phone calls.
IT'S NOT OPTIONAL
I think social media is the same thing. We're all talking about this like it's optional. It's not. If you're a financial adviser and you meet a Gen Y guy at a party, a 30-year-old who's making some real money, and he goes to look you up on Google and doesn't find you, to him you don't exist. This is not optional.
It doesn't mean you have to be tweeting all day and spending all your time on Facebook. That's not necessary. But you should have a beachhead somewhere, and you should have some social clout. You should have people following you and conversing with you. You should have some stuff out there that seems like you're engaged, because otherwise you'll come off like you're asleep.
Q. Is there room for all advisers to do what you are doing?
A. Probably not. But they don't need to do what I'm doing. I have 1,500 people that I personally follow. Hundreds of them are financial advisers, and they're doing just fine. They're not trying to become the biggest sound in the space. They're just trying to have a record of their thoughts, have the ability to talk about things that matter to them and share information. And that's totally cool. Not everyone has to be Mr. Facebook and Mr. Twitter. It's not necessary.
rhordt@investmentnews.com
