Firm: Richardson GMP
Location: Vancouver, BC
Year established: 2009
Employees: 5
AUM: $500 million
Target clients: Current or former entrepreneurs, complex financial situations, high- and ultra-high-net-worth individuals
Since 2009, the O’Connor Engelbert Investment Group has been tackling the complex issues of high- and ultra-high-net-worth clients. The team is the result of a unique partnership between Rory O’Connor and Tim Engelbert that combines their areas of expertise to provide the strategies and solutions to help this segment of clients.
The two teamed up in 2009, bringing together their extensive experience in the industry. O’Connor began his career with Merrill Lynch in the late ’90s, where he learned how to build a practice and the notion of his team’s current niche was born.
“A big part of what I learned early on was more clients isn’t always better,” O’Connor says. “You want the right kind of clients for a couple reasons. First, if you stick to principles, you end up with a business that is more scalable and enjoyable. The second factor is if you want to add value to clients, you need the time to do so.”
That’s why O’Connor decided to focus on high-net-worth entrepreneurs who have a level of complexity to their finances. “It’s not easy to grow that type of business because there are less of those households in Canada,” he says. “If you do it right, it means you have fewer clients, but they have more invested assets. You get to know your clients better and add more value.”
Engelbert, a Vancouver native, was working for Citibank in London during the financial crisis. With a background in risk management and investing capital on behalf of the bank, he had a different approach than O’Connor. But when Engelbert decided to return to Vancouver, a mutual friend put the two in touch, and they realized their skill sets were a perfect complement to each other.
“Tim has a different skill set that fit well with my background on the structural and wealth management side,” O’Connor says. “I understand the complicated things like trusts and corporations, and pairing that with someone like Tim, who is sound on the risk management and portfolio analytic side, has been really powerful.”
O’Connor and Engelbert have built their approach around prudent risk management and thoughtful capital allocation. However, O’Connor notes that because of the wealth they’re dealing with, they often must think differently than other advisors.
“What we try to do is think like a pension plan or endowment,” he says. “Knowing this is more wealth than clients will need for their lifetime, it tends to be viewed as intergenerational and lends itself to a longer time horizon. We can take an approach that mirrors that of institutional asset managers with exposure to real estate and different asset classes to build resilient portfolios. Luckily at Richardson GMP, our flexibility to design portfolios like that is quite robust.”
That institutional approach is something O’Connor feels sets the team apart. “You can’t compete in this market if you’re going to tell clients you’re buying government bonds and owning the TSX 60 – that doesn’t cut it; it’s too simplistic. The institutional approach is a differentiator, but it has taken many years to get to this stage and do it effectively.”
One of the benefits that has come out of working with high-net-worth individuals is their clients’ large networks, which means O’Connor and Engelbert are routinely introduced to others who may have investment opportunities.
When it comes to handling complex financial matters, O’Connor says his team’s approach is to show what their shared knowledge can bring to a situation. While every client is unique, he says, certain similarities arise within this niche – so while each client’s circumstances must be considered, there’s value in the fact that the team has likely encountered a similar issue in the past.
“There is a lot of shared knowledge, so we can look though a situation and understand how to add value,” he says. “We have seen enough of these cases to understand if a client is on the right track or has missed the mark.”
As for challenges, O’Connor says the biggest concern among clients tends to revolve around the transfer of wealth to the next generation.
“It’s trying to wrap your head around how and when to do it and how to communicate it all,” he says. “It is the biggest area of planning for us, and the hardest part is coaching people through the process of communicating the information to the next generation because it is not something that comes naturally to everyone. As well, there isn’t a simple ‘one strategy fits all’ approach. Every situation requires a unique approach, and we highly recommend the use of a qualified family facilitator – it can make a world of difference.”
After more than a decade together, the O’Connor Engelbert Investment Group now tries to keep its goals simple. “Our number-one goal is to make sure our existing clients are well serviced, happy and have everything they need – their investments are performing well, and their estate plan is well articulated and communicated,” O’Connor says. “If we don’t lose a client, that is a powerful statement – and what ends up happening is, if we are doing an exceptional job for our clients, they introduce us to other people like them.”
