Welcome back to the Alt Goes Mainstream podcast.
Steve’s private equity firm, $7B AUM HGGC, took a minority stake in Scott’s independent wealth management firm, $3.9B AUM True North Advisors, as part of their broader wealth management investment thesis.
After an illustrious 15 year Hall of Fame career as a three-time Super Bowl winning quarterback of the San Francisco 49ers, Steve embarked on second act to found HGGC that has rivaled his career on the field. Over the past 17 years, HGGC has grown to a $7B private equity firm that has completed 600 portfolio investments.
After working on Wall Street where clients were not being fiduciarily served, Scott's journey as a registered independent advisor started in 2000, when he and his partner Mark Gehlbach decided to pioneer the fee-only model to eliminate conflicts of interest in the client advisor relationship. The foundation they built has led to the growth of a firm that now stands at over 3.9B in AUM, with a large portion of that capital, $812M allocated to alternatives.
Steve, Scott, and I had a fascinating conversation about how they’ve built their respective investment firms, the importance of values and culture, and how they create abundant, fulfilling relationships. We discussed:
- Why “the score takes care of itself.”
- How and why defining the relationship up front is key in advisor M&A.
- How to assess culture fit when merging or acquiring advisors and wealth management firms.
- The importance of alternatives for better serving the client in an advisor’s practice.
- The concept of “decading” and why long-term thinking is critical in business and life.
Thanks Steve and Scott for sharing your thoughts and decades of wisdom on business building, investing, and partnership.
A word from AGM podcast sponsor, Ultimus Fund SolutionsThis episode of Alt Goes Mainstream is brought to you by
Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. In an increasingly sophisticated financial marketplace, investment managers must navigate a growing array of challenges: elaborate fund structures, specialized strategies, evolving compliance requirements, a growing need for sophisticated reporting, and intensifying demands for transparency.
To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. Ultimus offers a wide range of capabilities across registered funds, private funds and public plans, as well as outsourced middle office services. Delivering operational excellence, Ultimus helps firms manage the ever-changing regulatory environment while meeting the needs of their institutional and retail investors. Ultimus provides comprehensive operational support and fund governance services to help managers successfully launch retail alternative products.
Visit
www.ultimusfundsolutions.com to learn more about Ultimus’ technology enhanced services and solutions or contact Ultimus Executive Vice President of Business Development
Gary Harris on email at
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We thank Ultimus for their support of alts going mainstream.
Show Notes00:00 Introduction and Sponsor Message
01:17 Welcome to the Podcast
01:59 Meet the Guests: Steve Young and Scott Wood
02:22 Steve Young's Journey from the NFL to Private Equity
06:13 Scott Wood's Path to Founding True North Advisors
09:13 Building a Scalable and Collaborative Wealth Management Firm
12:57 Choosing HGGC: The Importance of Culture and Values in Business
13:30 HGGC's Investment Philosophy
15:03 Cultural Alignment in Partnerships
22:25 Evaluating Cultural Fit in Partnerships
22:40 Evaluating Cultural Fit
27:12 Governance and Day Two Operations
27:53 Commitment to Cultural Integrity
28:19 Navigating Cultural Fit in Wealth Management
28:55 Wealth Management Growth and Consolidation
29:40 The Role of Private Equity in Wealth Management
30:03 Changing Wealth Management Engagement
31:07 Challenges and Opportunities in Wealth Management Consolidation
32:22 True North's Unique Business Model
33:01 The Impact of Private Equity on Wealth Management
34:42 Exit Strategies and Long-Term Vision
39:39 Building an Alternatives Platform
40:31 Decading: Long-Term Thinking
40:53 Evolution of Alternatives Strategy
45:13 Simplifying Complex Investments
46:37 Fee Structures and Client Alignment
47:24 M&A Opportunities and Relationships
48:37 Mentorship and Professional Relationships
52:56 Future of Alternative Investments
55:56 Closing Thoughts and Reflections