Having recently authored a book drawn from his experiences, the founder of the organization drawing together wealth builders talked to Family Wealth Report.

Ensuring children get a solid start in life and are able to deal with money – and not get spoiled by it – is a constant talking point in the wealth management industry. And it certainly is a prominent theme of discussions among members of wealth creator peer-group organization TIGER 21, the body’s founder has told this publication. 

TIGER 21 now boasts 570 members in 50 groups across the US and Canada, with members also in London. It exists to give current and former business owners a forum to air views in a congenial environment. And in the 19 years of its existence so far – its 20th birthday comes up in 2018 – it has delivered on that promise, Michael W Sonnenfeldt told Family Wealth Report in a recent call. This publication recently reviewed Sonnenfeldt’s new book. (See here.)

“The number one issue on our members’ minds is their children. There’s no question that we had a particular thought when we founded it [TIGER 21] that people would be interested in smarter decisions about their wealth. Now the conversations are very much around families and children,” he said. “It is a topic that comes up again and again.”

A discussion point, for example, can be the error that some parents make that because they took risks and built wealth, their children should also be risk-takers as a way of showing ambition. But risk-taking and showing ambition aren’t necessarily identical, Sonnenfeldt said. TIGER 21 can help get such issues on the table and it allows wealth-holders to debate them.

Organizations such as private banks and multi-family offices can, to some extent, offer members the ability to socialize and share ideas with their peers in a confidential environment, although in the case of businesses such as banks, there may be a nagging concern that the firm wants to sell them something. That is a need for wealthy families to talk over issues without any commercial agenda appears to be borne out by the size, and durability, of a group such as TIGER 21. (There are of course various groups, such as Family Wealth Alliance and others, through which ultra-high net worth individuals can meet to exchange ideas. Readers who work for family offices and who have attended events hosted by this publication have a similar opportunity to bounce ideas off each other.)

TIGER 21 was formed out of a need for high net worth and ultra-high net worth people to share ideas and worries with like-minded people. It may sound odd but having great wealth can make for a lonely life because wealth-holders might not know people who understand their issues. For example, if a wealthy man talks to his college buddies about issues around wealth, the response is likely to be “boy, that’s a set of problems I’d love to have,” Sonnenfeldt said. 

“We are all about our members….the sole purpose I have focused on is to build an experience that is unique and member-centric,” said Sonnenfeldt, who is also chairman of Camanah Technologies Corp, a public Canadian firm that makes and distributes powered products and systems. 

“You can only do what you do here when you create an organization that has great integrity,” he continued. Members are vetted and TIGER 21 insists that conversations among members at meetings remain totally confidential. 

The diversity of members by age, gender, race, experience and location is a tremendous benefit and ensures that the exchange of ideas is lively and of a high level, he said. 

Hot topics
Cyber-security threats, as demonstrated by high-profile attacks on firms such as Yahoo, JP Morgan and Equifax, are very high priorities for members, Sonnenfeldt said. Blockchain technology and associated digital currencies such as Bitcoin are garnering a lot of attention. Separately, the US and global political scene – as seen by Congressional debates about taxes, are clearly very important concerns, as are events further afield such as the UK departure from the European Union. 

“In a low interest rate environment, that has a profound impact [on members’ wealth and thinking]…when you sell a business, unless it was a very high-tech business sold at a high multiple, then the income you get from that sold business will go down about 80 per cent,” he said. Many sellers of firms are in for a shock, he said. 

Members at TIGER 21 are also very excited by impact investing, and this is a significant talking point, he added.