Firm Update: May 2024

Welcome to our May Broker – Dealer newsletter!

Below, I would like to share some thoughts on the “Virtual Family Office,” the hot new approach to connect with and serve one of our core client demographics – the HNW “Owner / Entrepreneur.”

To all of our success!

The Virtual Family Office

Last month, I had the good fortune of attending the Investments & Wealth Institute “Experience 2024” conference in Las Vegas.  

I went to get better informed on how best to integrate the concept of the Virtual Family Office (VFO) with our core independent investment value proposition.   

A VFO is the idea of making “fractionally” available to the HNW Owner / Entrepreneur – defined as business owners / entrepreneurs with net worths of greater than $5 million -, a similar diversified and “bespoke” service offering as a traditional “one family” Family Office.

Which generally encompasses traditional wealth management PLUS access to private market opportunities PLUS complex estate planning and tax minimization advice PLUS…

access to experienced investment bankers to provide mission-critical business advice as to M&A, capital stack / financings, valuation, succession planning and more.  

At the conference the investor research firm CEG insights offered some awesome stats pointing to the growing allure of the VFO value proposition: 

  • Of 1,601 HNW Owner – Entrepreneurs surveyed, 57% of them prefer one advisor for both personal and business needs
  • 65% of them expect financial planning advice (as distinct from investment advice), 55% expect tax planning advice, and 51% estate planning advice
  • As to investment advice, a significant trend among this demographic is an increasing openness to non-traditional investments / informed guidance on a diverse range of assets beyond standard public market financial instruments
  • Only 36% of them have written succession plans, and of those that do over 54% plan to exit their business via “external means” – ie via a sale of all or part of the business to an outside party 

This demographic also showed very interestingly a heightened interest in analyses of the potential tax savings of relocating / re-domiciling their businesses to lower tax states and locales. 

What Can the Independent Investment Banker do with all of this to Drive More Deal Flow?

Well, very simply CEG flags that “by collaborating with investment bankers, wealth managers can leverage the bankers’ deep market insights, access to exclusive investment opportunities, and expertise in complex financial structuring, which can significantly enhance the wealth management services offered to HNW clients.”

Or, in other words – and why GT Securities has set up an affiliate Registered Investment Advisor – while it has always been the case, now more than ever investment bankers and wealth managers must and should work together to advise and serve this mutually desired HNW Owner / Entrepreneur clientele. 

So One-to-one Investment Banker / Wealth Manager networking and collaboration is a great start.

And when augmented with an in sync network of other expert advisors including tax, estate, insurance, legal and more, all collaborating to provide a unified “business plus personal” advice stack well what you have then is…

A Virtual Family Office! 

As mentioned last month, our newly formed RIA platform is designed for investment banker – wealth manager collaboration and toward that “bespoke” Virtual Family Office offering.

To learn more, visit our RIA site at www.gtria.com


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