Organic growth is key to $4.8B firm's success

RIA's focus on a team mindset has helped spur success

Aug 17, 2014 @ 12:01 am

By Trevor Hunnicutt

Ballentine Partners is among the fastest-growing RIAs in the country, and it's one of the few that has built its business organically and without relying on institutional clients to juice its assets.

In the past four years, the Waltham, Mass.-based multifamily office has nearly doubled assets under management to $4.8 billion, from $2.5 billion in 2010. In the last year alone, it increased AUM by 25%, according to data collected by InvestmentNews.

(More: Visit our exclusive RIA Data Center.)

The firm credits its growth to team structure, the increased willingness of wealthy individuals to reconsider which advisory firm they want to work with, and the transition from a practice that was dependent on a few key individuals to a business that is positioned to continue on long after those individuals leave the firm.

Like many wealth management firms, Ballentine organizes a team of professionals around its client families. But it uses a unique “matrix” structure in which every client works with a different combination of senior advisers, wealth planners and associates.

“We find that's a very helpful cultural structure because not only do you share information well, it also cuts down on this territoriality,” said Coventry Edwards-Pitt, the firm's chief wealth advisory officer.

“In order to serve families, you need to do both investments and comprehensive wealth planning very well — you can't just do one or the other,” she said. “Unlike an institution that hands you a pile of money, families come with complex tax and estate structures, and family dynamics. You have to understand that whole, quite complicated, picture.”

On top of that, advisers are working with a small number of clients, usually 10 to 15, Ms. Edwards-Pitt said.


The firm has emphasized reducing its dependence on key individuals in day-to-day operations, including founder Roy Ballentine.

“One of the goals I had when I came into this role was institutionalizing our firm. I think our firm should be very successful, no matter who gets hit by a bus,” said Ms. Edwards-Pitt, who joined the firm in 2004.

The markets have also created an opportunity for the firm to earn new business, she added.

“When markets are really terrible, people get somewhat paralyzed,” said Ms. Edwards-Pitt. “The market conditions, in general, have allowed people to take stock of their adviser selection and we've benefited from that ... there's new growth in the economy and that tends to drive demand.”

That kind of growth has driven the multiples that investors are willing to pay for thriving advisory businesses. Boston Private Bank & Trust Co. said last month it was acquiring fast-growing $4.3 billion adviser Banyan Partners for $60 million, a deal representing nine times Banyan's earnings before interest, taxes, depreciation and amortization.

But Ballentine has resisted temptations to sell itself — or buy other booming firms. Its growth has been entirely organic.

“[Like] a lot of firms in our industry, a founder in Roy's position could just have sold to a larger company, made a lot of money and walked away,” Ms. Edwards-Pitt said.

Responsibilities have been spread out and new employees hired. Last year, for instance, Ballentine hired a part-time employee, Nazanin “Naz” Hassanein, formerly of the consultancy Family Office Exchange, to cultivate relationships with other professional advisers, such as accountants and lawyers, who are an important resource to clients, and in some cases, a source of referrals for the firm.

“We keep our eye on growth because you need to grow at a reasonable and sustaining rate to keep people happy,” she said.


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