As liquidity and wealth creation has slowed down, Gresham Partners wanted to tackle the issue of sustainable growth for the next five to ten years.

As liquidity and wealth creation has slowed down, Gresham Partners, the Chicago-based wealth management firm with approximately $3.5 billion in assets, wanted to tackle the issue of sustainable growth for the next five to ten years.

The firm reached out to wealth management veteran Wallace Head, the former president and chief executive of Family Office Exchange and chief executive of wealth management for The Private Bank in Chicago, who was running his own consulting firm for wealthy families, Personal Fiduciary Advisors.

Head had worked with Gresham before, initially helping the firm transition from an executive planning firm to a wealth management firm twelve years ago and on subsequent projects afterwards.

The more familiar Head became with Gresham’s capabilities and growth potential, the more impressed he became. This month, Family Wealth Report has learned, Head officially joined Gresham as a principal and vice chairman and merged his consulting firm with the wealth manager.

“It was a very attractive opportunity,” Head told this publication. “I was very impressed by Gresham’s independent ownership model, nearly zero conflict of interest and ability to deliver excellent investment services.”

Path for growth

And what does Head see as the path to sustainable growth?

“The top one-tenth of the 1 per cent, that is the really, really wealthy have recovered economically,” he said. “They want and they can afford family office services. They’re willing to spend $500,000 to $1 million for some type of family office, and they want services. I believe this segment is a good marketplace.”

Driving business by existing clients and centers of influence, Gresham hopes to add from five to ten clients with at least $25 million in investable assets per year, Head said, adding to the firm’s current roster of approximately 80 clients.

Countering competition

How can Gresham meet this goal in a brutally competitive market?

Head thinks the firm’s independent ownership model, which is currently being transferred to the next generation, gives it an advantage over institutionally-owned firms and family-owned competitors.

Institutions such as banks and brokerage firms are conflicted, Head maintains, by selling proprietary products. What’s more, he argues, very wealthy clients don’t want to be in a “cross-selling environment.”

Family-owned firms, according to Head, have capital constraint problems and “find it hard to attract top quality talent.”

In addition, Gresham can flaunt its investment services and planning capabilities, which include a “risk-conscious” investing approach – a term the firm has trademarked.

What’s more manager selection has become “a key differentiator” for Gresham, said Matt Bonaguidi,  the firm's chief wealth strategist and a principal. “We spend a significant amount of resources getting access to the best managers in the world,” Bonaguidi said.

Gresham can also boast of a low client-to-advisor ratio of about 15 clients per advisor, and all client relationship teams include at least one owner, he said. “We value close relationships, and this gives you the ability to know the clients intimately.”

Lock on local talent

Gresham is also a major player in the dynamic Chicago market, which, Bonaguidi points out, has been difficult for outsiders to crack.

“Chicago is a very fragmented market,” he said. “A lot of firms have tried to come in and haven’t been able to… There’s a very Midwestern, grass roots, local culture in Chicago. The biggest challenge is attracting people, and it’s hard to do that when you’re not based here.”