Now add one more chunk of information to assimilate: wealth databases. A small group of determined data miners are slicing and dicing the world of high-net-worth individuals to extract easily digested sets of prospects: officers at public companies with stock options, people with a certain amount of investable assets, those with expensive hobbies like golf or yachting, and so on.
A stunning (some might say alarming) amount of personal information is public. Sell a home, get married or donate to a certain cause; it's all recorded someplace that anyone can access. And the wealthiest people, despite their best efforts, leave the biggest trails of all. But the trouble is, much of that information is scattered all over the place, in nooks and crannies no one would think to explore. Enter cutting-edge technology.
One data company, WealthEngine, says it culls information from 35 data providers, including the SEC, Dun & Bradstreet and even, ironically, a do-not-mail registry. The 21-year-old firm claims to rank the wealth of everyone in the U.S. - not just the wealthy - with a database of more than 100 million households.
WealthEngine tracks more than 10 million people with a net worth of $1 million or more, according to James Dean, head of the company's luxury and financial practice. It often knows who's a gambler, who likes golf, who owns a private architecture firm - and, courtesy of the Coast Guard and FAA, who owns boats and airplanes. (Cars are trickier since the DMV is tight-lipped, but many owners of Mercedes and BMWs are all too happy to tell websites and magazines about themselves.)
And WealthEngine does custom searches for buyers of its data: It can assemble profiles and personal balance sheets for your prospects, listing assets (real estate, pension, stock holdings) and income, as well as information about spouses, children, age, education, ethnicity, and contributions to charities, political parties and candidates. Home and business addresses, email and phone numbers are there, too.
PUTTING DATA TO USE
WealthEngine says that, last year, one RIA firm requested a list of 500 ultrahigh-net-worth prospects, each worth at least $20 million, who had contributed at least $10,000 to the Democratic National Committee. The firm then invited these high rollers to an exclusive $10,000-a-plate fund-raising dinner with President Obama in New York.
Such surgical precision comes at a price. In addition to picking up the tab for the tables, the firm paid $7,500 for the custom search that identified the prospects.
Was it worth it? If the firm gained even one client, the fees generated from managing that one account would likely amount to a couple of hundred thousand dollars a year. (WealthEngine declined to name the firm, or say whether it had picked up any new clients.)
More common, say companies, are simpler data runs costing about $3,000. One sample query, for instance: all prospects of Hispanic descent living in New York or Los Angeles with more than $15 million in investable assets. A search like that will likely generate 10,000 names, and will cost about $5,000. But services are offered at a wide range of prices. A large advisory firm might spend $250,000 annually on data searches, Dean says.
San Diego planner R. J. Kelly, the founder of Wealth Legacy Group, first heard about WealthEngine from a friend in the philanthropy world. The woman, who ran a foundation, said that whenever she heard of a possible new donor, she plugged the name into WealthEngine.
Kelly says he really sat up and took notice during a demo by a Wealth-Engine salesman. Just for fun, Kelly asked for information on several of San Diego's biggest names, including Irwin Jacobs, founder of Qualcomm. For those who owned large blocks of publicly traded stock, the information was all there - including Jacobs' $2.1 billion in Qualcomm and other holdings. But that wasn't all.
"It was fascinating. ... It told me not only the amounts of money he gave, and to whom, but also whether it was cash or stock," Kelly says. "It was almost a little embarrassing to look at that much detail, but it was public."
The database's next trick also impressed him. He asked for all the individuals with $10 million or more in the Mission Valley area of San Diego, and it spat out about a dozen names. "So here's my target list - pretty extraordinary," Kelly says.