Personalised service and smaller client bases are telltale signs of success in the high net worth market and the results of a very targeted and planned business strategy. Byron Capital Private Investors tops the list of dealer groups working in the high net worth space, with its two advisers averaging funds under advice (FUA) of $343,000. This is calculated by dividing FUA at December 2006 by the number of advisers.
This very private, independently-owned boutique group focuses on building long-term client relationships designed to deliver a holistic service, including tax planning, superannuation, wealth creation, private portfolio management, estate and succession planning, and insurance. Byron Capital provides specialist advice on all asset classes, particularly listed property, listed fixed interest and shares, using its own in-house research team. Fees are based on funds under management (FUM).
Other dealer groups specialising in the high net worth space share similar features, particularly fees charged on FUM and strong capabilities in direct investing. This is particularly a feature of Perth-based Hogan and Partners, which has more than 39 years' experience in stockbroking, offering services in shares, warrants, instalments and options. However, despite the enviable FUA such businesses manage, it is by no means a fluke they have been successful in attracting such client bases, and further, that other dealer groups are now emerging in this space. This is the case with Brisbane-based Goodman Private Wealth Advisers, which this year is celebrating 20 years of business.
"The first 10 years of this business' existence, it was a one-man band with John Goodman [founder and chairman]," Goodman Private Wealth Advisers chief executive and senior adviser Brad Church says. "Twenty years ago, our market was not as clearly identified as today. But 10 years ago we decided to be a real business, a permanent business and that's when the hard work started. "Now it is our quality of what we do that sets us apart."
Church says its ideal clients are successful families with $500,000 to invest. A typical client will have $1 million to invest. These clients want personalised service so the business limits its client base. Church says this gives Goodman Private an edge over larger players.
"Some of the larger groups are probably spread a bit thin," he says. What this means is that businesses such as Goodman Private are now competing with the likes of State Super Financial Services Australia, which was ranked 16th on the top 20 dealer groups list based on the net worth of their clients. State Super is one of the largest superannuation funds in Australia with close to 160,000 members. However, Church is skeptical about the quality of service clients may be receiving in such super funds. He says super funds such as State Super and Telstra Super Financial Planning may appear on the list because they have such huge member bases. "All you need is one account with $100 million and you've got an impressive funds under advice figure, whereas we deal with families," he says. "We've got about 80 clients per adviser, while some businesses have thousands. It tells a very different story."
