Bartlett Wealth Administration President Kelly Mazzoca has day-to-day oversight and can doubtless succeed new CEO James Hagerty.
Brooke’s Notice: Bartlett Wealth Administration added a lady CEO in 2007, and the transfer labored like gangbusters, each when it comes to large AUM development and a real feminization of the enterprise. However out of the blue it has no feminine successor ripe and able to take over. What to do? The quick reply is to let a pointy 34 year-old girl run the corporate, day-to-day, below the auspices of a seasoned 52 year-old male CEO. These exact micro-moves additionally demanded extra macro-level planning and motion. An LBO-like cope with Focus Monetary to fund the advanced succession supplies a really clear thought why a ladies is operating the present within the first place. This is not taking place in an enclave of presumed progressiveness like Los Angeles, or New York, however Cincinnati, a metropolis with a Democratic mayor in a Republican state that has a stable progressive file of its personal.
An century-old Midwestern RIA busted the curve by hiring a feminine CEO in 2007 and now faces a dilemma together with her retirement: Easy methods to preserve its female edge and monitor record– she grew AUM to $7.2 billion — with no girl successor.
Kelly Downing, now in her late 60s, will keep on at Bartlett Wealth Administration till Aug. 2022 as govt chair, wealth advisor and principal. James Hagerty, 52, was named the brand new CEO, efficient Jan. 1.
The corporate can be making the exceptional transfer, naming Holly Mazzoca, 34, as Hagerty’s inheritor obvious on day-one of his tenure.
“Up to now, so good,” says Hagerty.
Downing handpicked Mazzoca to handle Bartlett’s each day enterprise, as a part of a two-year succession plan developed with New York roll-up Focus Monetary Companions, its owner since 2018.
“Holly presumptively will totally take over as CEO,” Downing explains.
“There is a pure development there, and as president, she’ll be principally operating the day-to-day operations of the agency.”
The times shall be busy. Unusually, Bartlett is concurrently switching out its software program system and its leaders. It would quickly exchange Creation’s APX with Addepar for efficiency reporting. See: With rivals pressing, Addepar insiders ante $117 million to up its game and settle in for the long haul — as the firm adds $2 billion in pandemic-driven AUA each business day.
Eyes on the prize
Downing started making her mark on the corporate as quickly as she was named the 132-year-old agency’s CEO greater than 22 years in the past. Proper off the bat, she modified her agency’s hiring mannequin to faucet feminine expertise.
“We had been intentional in bringing ladies into the enterprise. We opened up advertising positions to carry ladies in straight from school. Historically Bartlett solely employed individuals with no less than 5 years of expertise, a CFA and very funding oriented,” Downing explains.
As an alternative, the agency seemed for individuals excited by or already holding a CFP as a method to herald ladies, she says.
As we speak, ladies make up 30% of the agency’s companions and 40% of its managers. 4 of its 9 feminine senior executives maintain an possession stake within the agency in contrast with 11 of its 18 males.
Hiring ladies can be a enterprise choice — as a result of their financial institution accounts are the place the cash is, says Downing.
“Girls are those who find yourself with all the cash as a result of we dwell longer … [and] it is turning into extra vital, even for my technology that there are ladies to whom I can discuss. That’s one other vital purpose to carry ladies advisers in.”
Her view is in keeping with a July 2020 McKinsey report that tagged ladies as “the following wave of development in U.S. cash administration.”
“An unprecedented quantity of property will shift into the fingers of US ladies over the following three to 5 years, representing a $30 trillion alternative by the top of the last decade,” the report notes.
Glass ceilings
As we speak, the thought of ladies in prime monetary roles has — to a larger extent — grow to be normalized.
That mentioned, simply 37 Fortune 500 corporations have a feminine CEO, and girls in prime positions stay scarce in monetary companies.
Feminine CEOs within the trade embody Abby Johnson (Constancy Investments), Jennifer Johnson (Franklin Templeton), and Adena Friedman (Nasdaq), all of whom additionally maintain the presidency at their respective corporations.
Sarah Levy additionally lately took the highest spot at start-up Betterment. See: Sarah Levy, who joins an exclusive club of top women executives, with a mission — an IPO.
The extent under the CEO spot contains Jane Fraser, Citigroup president and CEO of worldwide client banking; Jenn Piepszak, chief monetary officer at JP Morgan Chase; and Stephanie Cohen co-head of Goldman Sachs’ client banking and wealth administration division.
But if ladies in prime jobs in monetary companies stay a minority, albeit a rising one, their numbers far exceed these of even a decade in the past.
Certainly, when Downing took the highest spot at Bartlett in 2007, she joined a small band of high-ranking outliers that included Ellevest founder and former Smith Barney CEO, Sallie Krawcheck. See: Ellevest’s ‘for-women, by-women’ message gets more literal after Sallie Krawcheck and her male co-founder part ways and AUM growth picks up steam.
Staying targeted
Bartlett deliberately sought out and started the method of shopping for again the agency from Legg Mason with the intention of discovering a associate that may enable us to plan for succession, whereas offering continuity, Mazzoca explains.
In 2012, Bartlett purchased out Legg Mason; it first affiliated with the agency in 1996.
When Downing started speaking about retirement in 2018, Bartlett sought out Focus as an investor to execute the succession.
Focus additionally offered a money injection to restart Bartlett’s long-dormant M&A effort.
Earlier than the Focus deal, Bartlett — an early roll-up within the 1950s — had not bought an RIA since 2001.
In 2019, it snapped up Chicago-based RIA Lodestar Funding Counsel.
Bartlett declined to disclose if Focus owns a majority stake — usually it buys 100% of the corporations it invests in — however the roll-up is strictly “hands-off,” outdoors of a must sanction main capital bills in extra of $500,000, Hagerty explains.
“Our wants from Focus aren’t so nice,” Downing provides.
“Possibly that is why it is extra of a consultative strategy. We’re simply open to different concepts that they could see.”
Second century
Bartlett’s positioning for its second century goes past personnel; it is also ramping up its fin-tech.
It is changing its previous portfolio administration software program, APX, with Addepar, as a result of APX was not as much as snuff, in response to Mazzoca.
“We wanted a extra versatile system,” she says. “We additionally consider it will likely be a really enticing providing to help future inorganic development alternatives.
For probably the most half, Bartlett holds particular person shares and bonds on behalf of its buyers, though Kenneth Schlachter, a wealth advisor and principal on the agency, has expanded its ETF and mutual fund portfolios.
Bartlett intently ties its payouts to efficiency, particularly consumer retention. See: RIAs need to get over ‘quotas’ when it comes to sales and growth, or end up being owned by an RIA that knows how to impose them.
One of many first recommendation outlets to register with the Securities and Alternate Fee (SEC) as an RIA in 1940, Bartlett additionally faucets native accountants and legal professionals for referrals. See: In their own words: Five top advisors’ secrets for creating stronger alliances to gain more referrals.
As we speak, at least 80% of Bartlett’s client-base is made up of high-net-worth and ultra-high-net-worth buyers. Its typical consumer, aged between 60 and 65, has about $four million in investable property, inclusive of trusts, retirement financial savings and sometimes a charitable fund.
Since 2015, Bartlett’s AUM has risen 140%, from $three billion to $7.2 billion in the present day.
Strip out market appreciation, benchmarked by the S&P 500, and Bartlett added roughly $500 million a 12 months in web new property over the identical time.
The household workplace custodies no less than 80% of its property at Schwab, with the rest divided between Constancy, Pershing and quite a lot of smaller belief corporations.
Orchestral brass
Hagerty joined Bartlett in 1994, aged 25 as a CFA in a conventional insurance coverage and financial institution belief place.
But his supposed management type is extra orchestral than table-thumping alpha.
“The conductor does not must run round and inform the man the best way to play the cello or the woman the best way to play the harp. They know what they’re doing,” he says.
His age, and practically 30 years expertise at Bartlett additionally makes him an ideal bridge to inheritor obvious Mazzoca, Downing provides.
A Cincinatti native, Mazzoca joined Bartlett in her 20s, like Hagerty. But she did so with no CFA, or a CFP, which she obtained in Aug. 2018. She holds an MBA in finance from the Kellogg Faculty at Northwestern College.
Earlier than she joined Bartlett, Mazzoca spent just below 4 years at Chicago hedge fund JHL Capital Group in a enterprise growth function, and virtually three years at JP Morgan Personal Financial institution as an asset administration analyst.
Each Hagerty and Mazocca serve as wealth advisors at Bartlett, and as members of its administration committee.
Two up, two in
Bartlett, which employs 67 — up from 62 in 2019 — added two new workers to its govt committee this January, Brian Antenucci, who holds a CFA, and Lori Poole, who holds a CFP.
Antenucci, a Bartlett wealth advisor and principal, and a former US Financial institution portfolio supervisor, joined Bartlett in Aug. 2012.
Poole, additionally a wealth advisor and principal, joined the agency in 2009 as a consumer communications affiliate, and labored her method up.
Bartlett restructured in Jan. 2020 to divide the agency below a number of managing administrators, all of whom now report on to Mazzoca.
Early in her tenure, Downing additionally restructured the agency’s consumer conferences, dropping one CFA from the agency’s two particular person consumer companies groups in favor of CFPs.
This shift adopted the agency’s adoption of eMoney’s monetary planning software program. Beforehand, Bartlett constructed its plans by Excel.
Passing the baton
Benjamin Bartlett based what would later grow to be Bartlett in 1898 when he purchased a seat on the NYSE. He then bought the agency in 1926.
It modified fingers once more when Downing’s predecessor, James Miller, bought a controlling stake to Legg Mason in 1996.
Downing’s departure — and Hagerty and Mazzoca’s appointment — marks the agency’s eighth handover.
Now, together with her successors in place, Downing says she will’t wait to show make use of her inexperienced thumbs.
“I am wanting ahead to [retirement]. I am an avid gardener engaged on self-sustainability. So that is what I am pursuing,” she says.
“You may assume you need to golf on a regular basis, however you most likely do not.”
— to riabiz.com
The post Woman CEO who grew her RIA to $7.2 billion of AUM yields to a new male CEO, but another woman in the wings is gearing up for its second century when female investors will dominate appeared first on Correct Success.
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