Firm’s family service gets personal

Staying in touch with yacht crews and gardeners? Hey, it’s all part of a day’s work for The Gannon Group.

The St. Louis-based advisory firm — a unit of Morgan Stanley Smith Barney LLC — works exclusively with 14 large families. Those families span five generations and have nearly $1 billion in net worth. While the Gannon group manages more than $500 million of those assets for the families, it does more than just handle the money.

A number of employees provide what might be dubbed “concierge services”: They work with clients daily, making international wire transfers and ensuring that household employees are paid on time. The group also has an answering service that gives clients 24/7 access.

The firm is led by adviser Niall Gannon, who works to reduce tax liability for clients while managing their portfolios. “We manage the portfolios taking on the personal fiduciary liability,” he said. “Much of the financial adviser community relies on mutual funds. We’ve put our neck on the line.”

Mr. Gannon says he enjoys working with the clients, likening them to former Wal-Mart founder Sam Walton. Like Walton, the families essentially built their wealth from scratch – and each now has $40 million or more in assets.

“They’re great people to work for because they all came from nothing,” he said. “They’re very practical.”

But Mr. Gannon noted that the firm couldn’t provide the same high-touch services if it added more clients.

For instance, he meets with each family a minimum of six times a year, while the firm’s advisers usually meet with spouses separately because they have their own individual trusts.

“A family office goes beyond just managing the assets,” said Chris Thach, an analyst with The Gannon Group. “These large families almost become their own business entities”

Indeed, clients call Cindy Feaster, the family office manager, whenever they make a large purchase or need a wire transfer.

Ms. Feaster also looks after more mundane tasks. She keeps tabs on clients’ travel schedules. Before clients travel overseas, she contacts their credit card companies to ensure their charges won’t be denied or flagged as fraud.

“I am always trying to figure out a solution to a problem,” she said. “We have clients who will dispute a purchase on a credit card and I try to get them reimbursed.”

She also speaks with clients’ household employees, as well as yacht crews. Once, Ms. Feaster hired an interpreter to help her transfer a client’s money from the United States to Germany.

“I love it,” she said of working with the family members. “It’s very interesting.”

Shop Talk is a regular column detailing how financial advisers run their businesses. The column focuses on unusual or innovative ways to attract more clients. Suggestions or tips for Shop Talk? E-mail Lisa Shidler at [email protected] or visit the Shop Talk page at InvestmentNews/shoptalk.