Angeles Wealth Management’s Expansion to a Bi-Coastal UHNW Powerhouse Contains Growth Strategy Lessons for the Industry
Headlines related to the wealth management space these days tend to focus on M&A consolidation, private equity capital infusions and the intensifying recruiting wars between firms over giant teams of financial advisors.
To be sure, big roll-up acquisitions and massive up-front recruiting checks are a solid growth strategy for firms serving the mass affluent where services and solutions can be templatized to a fair extent without risking client ire.
But it’s a different story when it comes to the more rarefied atmosphere within the high net worth (HNW) and ultra-high net worth (UHNW) client segments – Defined by WSR as, respectively, households with net investable assets of $7 million to $25 million, and households with minimum net investable assets of $25 to $30 million and above.
Serving HNW and UHNW individuals and families requires a high degree of personalized service and customized solutions. It is as much an art as a science, with relationships, advice and hand-holding every bit as important as the hard skills.
And the hard skills – from investment management, to valuation of illiquid assets, to estate planning support – must accommodate very sophisticated and demanding standards.
Successful expansion by firms in the UHNW space tends to be defined by thoughtful and targeted moves – A marksman’s rifle versus a shotgun’s broadside, so to speak.
Angeles Wealth Management and Angeles Investment Advisors
When LA-based Angeles Wealth Management – founded ten years ago by CEO Jonathan Foster and Angeles Investment Advisors – first began considering the launch of an NYC office, the firm prioritized building it around the right individual.
This approach was guided by the experiences of Angeles Investment Advisors, which had provided high-touch investment advice and investment management since 2001 to endowments, foundations and corporations.
When HNW and UHNW individuals and families began to show interest in access to the same guidance and opportunities as the services offered by Angeles Investment Advisors, the opportunity to create Angeles Wealth Management was born.
The team carefully created a spectrum of private client-specific services to complement the offerings of Angeles Investment Advisors, including tax-aware management, multi-generational communication and education, financial planning and estate planning coordination.
The broader Angeles organization believes it is differentiated from the rest of the UHNW space in two key areas.
First, culture and values. Angeles Investment Advisors takes pride in the particular segment of institutional clients the organization supports.
According to a statement from the firm, “While our institutional clients represent an extremely diverse array of cultures and mindsets, much of the work we do is with mission-driven organizations such as hospitals, museums and higher education institutions.”
“We advise and invest endowment and foundation funds on behalf of the boards and leadership teams of these institutions. What AIA aspires to do each and every day is protect and help grow very long-term financial security for the institutions we serve, as that is the only true guarantee of their ability to fulfill their broader social mission.”
Second, the investment platform that the firm has built over the past two decades, available to both institutional and private clients.
According to the firm, “Our platform combines proprietary due diligence, portfolio construction and investment strategy with an open architecture approach that counts what we believe to be many of the best asset managers in the world – including private equity, venture capital and hedge funds managers – as our strategic partners.”
West Takes East
A chance meeting at an industry conference, however, provided Foster and the Angeles team with the individual they were seeking to plant the firm’s banner in NYC to become a bicoastal firm with a presence in two of the nation’s largest and most important metropolitan economies.
In early 2019, Foster first met Harry Grand, a seasoned UHNW wealth management and multifamily office executive with a professional pedigree encompassing firms such as Rockefeller as well as Lazard.
Forming an immediate connection, Grand and Foster had further meetings and discussions, culminating in Grand’s launch of Angeles Wealth Management’s NYC offices in April that year, as a Senior Managing Director of the firm.
From a temporary office as a solo show, Grand has grown the NYC office significantly, in client relationships, assets and talent, bringing aboard four highly experienced wealth management professionals who report to him.
Commenting on the growth momentum Grand has driven for the firm in NYC, Foster said, “I’m a strong believer in hiring to talent and character. You build a business around people, not people around a business.”
“We made a big bet on Harry and his talents in launching and operating a business. The success has us doubling down on our commitment to Harry and the great team he is building in NYC, which is still the center of the financial universe.”
The Angeles organization today reportedly manages approximately $40 billion in institutional and private client assets.
And as for the temporary office where Grand started? The team of five professionals who represent Angeles Wealth Management in NYC moved recently to the iconic Seagram building on Park Avenue.
WSR spoke with Harry Grand recently to explore his approach to UHNW client service, and how that approach has enabled the successful West-to-East expansion of Angeles Wealth Management.
WSR: How did you get your start in UHNW wealth management?
Grand: I began my career working for the Rockefellers, in the Rockefeller family office on the 56th Floor of Rockefeller Center. It was an incredible launch into the world of UHNW and HNW wealth management, advising and investing on behalf of over six generations of Rockefeller family members, along with many other similarly situated individuals and families.
I worked alongside the Rockefeller advisors, attorneys, trust professionals and family members. I also collaborated closely with the professionals at VenRock, one of the early pioneers of venture capital investing.
At Rockefeller, I quickly realized the complexity involved with ultra-high net worth families as we managed art, commercial, residential and farm real estate, illiquid and liquid investible assets.
After a lot of planning and branding, we strategically decided to open the family office to outside clients, thus growing the firm from $8 billion to $30 billion over six years with families and institutions in Europe, Asia and all throughout the US. We also launched a sub-advisory asset management business in Japan, Luxembourg, and Portugal.
All in all, it was a phenomenal experience that reinforced my ambitions of spending the rest of my career in HNW and UHNW wealth and investment management.
WSR: Spearheading the launch of the NYC office – and first-ever East Coast location – of a historically West Coast-based firm sounds both exciting and daunting. What made this opportunity appealing to you?
Grand: Any professional who is passionate about the private wealth management space is acutely aware of how challenging it can be for one firm to bring together each of the key elements necessary to succeed in serving a highly demanding and sophisticated client base.
Some firms have a great founder and leader, but lack strategic depth elsewhere on the team. Other firms might have seasoned teams, but operate under a model that emphasizes proprietary investment solutions, versus offering an open architecture approach that emphasizes service and advice over investment management fees.
And of course, there are many HNW and UHNW-focused firms that offer open architecture investment solutions, but lack one or two of the following crucial features: In many instances, they lack the depth of in-house due diligence, portfolio construction and investment management expertise to properly vet and curate such a platform.
And more often than not, they just don’t have access to the most select and sought-after managers in the world.
At Angeles Wealth Management, thanks to our connection with Angeles Investment Advisors, we can deliver on every single one of these key features, while continuing to offer an extremely high touch, boutique service model for our clients, who want and expect nothing less.
WSR: What were the biggest opportunities and challenges that emerged in the course of your launch and growth of the NYC office of AWM? What was expected, and what, if anything, came as a surprise to you?
Grand: I wish I could say that the NYC offices have always been in a tony address, but the reality is that I started the NYC office with a computer and a phone in a temporary office space.
That temporary office became a daily visual reminder to me that Rome wasn’t built in a day, but it shouldn’t take forever either.
So each morning when I first came into the office, there was an “off to the races” sensation that was both scary and exhilarating.
One of my biggest – and most humbling – surprises happened on day one of our launch. I thought I’d be spending much of my time in the opening days and weeks doing outreach to prospective clients on my own, and it was actually quite the opposite of my expectations.
The phone just started ringing repeatedly, and I received multiple inquiries from former clients who wanted to work with me once more.
From there, between inbound inquiries that came to me organically from longstanding contacts, and proactive outreach on my part, in just a few months, it became clear that we’d need more people and a larger and more permanent office space.
Since then, we moved into the Seagram building on Park Avenue, and I am pleased to say that our office now encompasses five professionals, and a constant flow of LA-based colleagues doing investment due diligence and assisting in the service of our East Coast clientele.
Looking ahead, the challenge for our office is to carefully manage our growth so that it happens at a thoughtful pace. We’re focused on ensuring the quality of the client service experience is never diluted.
We know that we’re the custodians of the Angeles brand here on the East Coast, and that is a responsibility that we take very seriously. By carefully growing one client at a time, we’re supporting the broader Angeles organization’s reputation for delivering an elevated client service experience and outcomes.
WSR: What is your typical sweet spot client at the NYC office of Angeles Wealth Management?
Grand: The UHNW segment has become much more diverse over the past two decades, in line with the rapid growth of certain industry sectors and creation of new wealth, as well as the transition of multigenerational wealth to younger family members.
And we move with the times. We have institutional and private clients with investable assets in the millions to billions. We work with new wealth and old wealth.
In terms of asset size, we accommodate all account sizes since we understand there are grandchildren trusts, 529 plans, IRA accounts, etc.
I’d also add that we tend to look at family units when “counting clients.” We work with approximately 73 family units. The top 10 family units with whom we work average approximately $60 million in assets managed. Viewed within this context, our sweet spot is usually $20 million to $75 million in assets.
WSR: What kinds of professional advisors tend to refer new clients your way, and how do you earn their trust?
Grand: The diversification of clients is exciting as we work with business leaders, entrepreneurs, inherited wealth, and so forth.
And this means client referrals have come from a variety of professionals: trust and estate attorneys, matrimonial attorneys, accountants, chief financial officers of privately held companies, private equity and venture capital investors, liquid managers…and, of course, friends.
It’s become a cliché for a wealth manager to say that he or she is “humbled and honored” when someone introduces them to a new potential client, but it’s true.
When somebody introduces us to a person who is looking for professional advice on one of the most important features of their life, the introducer is putting his or her own reputation on the line.
And that’s something we take very seriously, as our client referral sources know.
WSR: Are there significant cultural differences between UHNW clients from the West Coast versus their counterparts on the East Coast? And what have been the practical benefits to opening an NYC office given how virtual the world has become?
Grand: Our families are sophisticated and generally world travelers – COVID-willing. However, there is a geographic identification.
Though we manage truly global portfolios, clients are most comfortable having a core advisory team to which they are geographically connected.
Moreover, wealthy families today overwhelmingly have many close personal connections as well as family members living on both sides of the country or in between.
It’s great fun when we make the connection that a NY-based client has a home in Park City down the road from a client based in LA. It allows for broader networking, and exciting client meeting coordination with our West Coast colleagues.
Having a New York office has helped the firm in many practical ways as well.
Operationally, we start the day (at least) three hours ahead of LA so from an efficiency perspective, it is fantastic!
We can work on a project for three hours before LA gets up and then they can tackle the project for three hours after we go home. New York also allows our LA professionals to have a place to sit and work in between meetings with NY-based and European-based managers.
I’d also like to emphasize that NYC has some of the sharpest and sophisticated clients in the world. It’s been my home since childhood – Rising to, and exceeding, the exacting standards of New Yorkers is all I know.
Janeesa Hollingshead, Senior Editor of Wealth Solutions Report, can be reached via email@example.com