His vision for starting GWS was to deliver investment strategies and wealth management services typically available at the highest levels of wealth. Today, clients benefit from these sophisticated financial services targeted to meet their unique needs.
Earlier this year, Glassman Wealth quietly surpassed $2 billion in assets under management (AUM), and honestly, I hesitated to share the news. After all, how does hitting an AUM milestone benefit our current clients?
My hesitation comes from a comment by one of my favorite clients who, shortly after I opened Glassman Wealth, made a comment that changed how I think about our growth. A few weeks after transitioning clients to the new firm, I held a dinner with some of my favorite clients—the clients I want to keep, learn from, and replicate.
As I talked about how to grow the firm, one client, Harriet, said (plainly), “How does your growth help us? We don’t want you to grow. You grow, we get less attention.”
That stuck with me. Harriet was right. I was already stretched with over 100 clients who I promised would get sophisticated investments and planning strategies.
Therefore, I decided to grow slow (read: smart).
So, we kept our $2 million minimum for new clients and focused our attention on current clients instead of an endless stream of prospects.
We did basically no marketing other than client educational events and sponsorship of philanthropic causes.
As we passed $500 million and $1 billion AUM milestones, we took our growth and reinvested it on behalf of our existing clients. How? We hired really smart, curious, and experienced financial advisors. During this time, we significantly improved our client-to-advisor ratio, reducing it from approximately 100 to just 30. It’s what those advisors dreamed of, and at the same time, gave our existing clients more attention and personalized strategies.
Given the added time we then had with each client, we started doing something that is unusual in the financial advisory industry, but seems normal to us now: We asked to see every client’s tax returns. Many send them to us in advance of filing; others shortly after. Either way, we learned so much more about each client and were then able to tailor investments, tax, and estate planning strategies to the specific family.
We also decided to make the parents and children of our clients full clients, whether they had any money with us or not. We ended up hearing from young adults with questions about their first pay package, their first tax returns, and their first mortgages. Our clients were also relieved to know that someone objective was pushing their parents to button up their estate planning.
We reinvested and upgraded our investment research capabilities by outsourcing due diligence to a firm that not only does it full-time but also cross-pollinates among firms to help design portfolios and solve ongoing challenges. When we have a new client with a peculiar existing investment or an interest in something esoteric, we have a resource who has seen and likely solved it before.
And we took a healthy chunk of the profits and reinvested it in the team benefits and culture to keep our best people happy. Being ranked #1 Best Place to Work in Washington DC by the Washington Business Journal means employees are happy. They stay, and they stay engaged in the current and future success of the company.
Last, while most of my peers have sold to roll-up firms and private equity over the past few years, I have decided to do it differently and have started selling to my employees. I now have three employee equity partners and plan to grow that over time.
So, it is not that we hit a $2 billion milestone that I’m most proud of and feel compelled to share, but how we got there. You know, with Harriet in mind.