2013 Top 40 Under 40 Countdown: #21-#30

January 6, 2014 5:19 PM

No. 30: Peter Strope

Firm: UBS

Location: Pittsburg, PA

Production: $3.017 million

AUM: $469.81 million

Age: 37

Peter Strope freely admits that he didnt know a stock from a bond for the first two decades of his life. A nursing student, he made his first equity purchase shortly after graduation on a rumor that a $2 stock was about to go to $10. Within three days, that company filed for bankruptcy, and 22-year-old Strope had lost his savings.

It was the best $500 I ever lost, he recalls, because the process of buying the stock put him in touch with his local PaineWebber office, which happened to be hiring. After completing PaineWebbers training program, and later partnering with an experienced advisor, Strope found he had a talent for expanding relationships with relatively small clients. Within that first partnership, for example, he helped to more than double assets under management and more than quadruple revenues.

Now, Strope is focused on growing his business through acquisition. I see other advisors who are struggling but dont have a process for growing their businesses. They dont ask the right questions or track the right metrics, he observes. These are things I have a process for. He has completed four acquisitions (often retaining the primary advisor), with a goal of tucking in two or three more before he retires. His team currently has AUM of $750m.

Expanding existing relationships is still important, of course. One of Stropes regular requests to clients is the chance to review their estate planning documents. In most cases, that turns up plenty of follow-up items, and cements the clients trust in him. Many financial advisors take it for granted that a $10 million client has their estate plan in order, says Strope,but based on what Ive seen, I dont buy that anymore.

No. 28 tie: Eric Snyder

Firm: Merrill Lynch

Location: New York, NY

Production: $3.0190 million

AUM: $1.16 billion

Age: 39

From the outset of his career with Merrill Lynch, Eric Snyder seized on the value of the team practice.

When Snyder and his old Penn State fraternity brother Charles Balducci (tied for #28 on this year's list) finished Merrill's training program, they were advised to put in their time working as sole practitioners to build up a business before they launched a team practice. They declined. Now, with a large and growing base of ultra-high net worth clients, it seems safe to say they made the right call.

"We decided to go against our management's advice and it was one of the better decisions we made," Snyder says.

In the early years, Snyder and Balducci were focused on corporate executives with highly concentrated stock positions. With no book of business or family network, they began by cold callin, and quickly devised a strategy of immersing themselves in the intricacies of prospects' pension and 401k plans to help overcome objections to their youth.

"When we got into the business we were pretty young. We were 22. Because we were so young -- we looked young and we were young -- we had to become the experts in a particular niche market," Snyder says. "We became the de facto resident experts."

The practice has diversified considerably in recent years, broadening its base of clients as the staff has grown, roughly doubling in size to 13 over the last five years. Snyder says he is looking to hire more people over the next few months.

"What we see in the future as a trend is teams forming and teams getting larger," Snyder says. "It is too difficult today for the sole practitioner to do everything for a client."

No. 28 tie: Charles Balducci

Firm: Merrill Lynch

Location: New York, NY

Production: $3.0190 million

AUM: $1.16 billion

Age: 38

Charles Balducci's apprenticeship in the financial world imparted in him the value of a high-touch, comprehensive approach to investment advising. It wasn't so much what he saw, but what he didn't.

The summer before his senior year in college, Balducci interned at a large financial services firm, working as a cold caller for a senior vice president.

"Over the course of that summer, said Balducci, I would watch him and I would see his approach. Even though the guy was very successful from a money-making standpoint, I thought there was so much he was lacking," Balducci says. "He was really just pitching stock ideas."

As an intern, Balducci was in no place to critique the executive's approach, but he knew that his career path would be different. "Even at 20 years old, I just knew that there was so much more that this guy could be doing," Balducci says. "I just felt like he was missing the whole point of financial advisory."

Balducci joined Merrill after college and very quickly launched a practice with fellow Penn State alum Eric Snyder (tied at 28 on this year's list), catering at first to corporate executives and eventually branching out to hedge fund managers, entrepreneurs and other high net worth clients.

From the start, Balducci says that he and his partner have made it a standard practice when taking on a new account to meet with the clients CPA, attorney and other professionals involved in his or her finances. That approach fits with the philosophy of a holistic advisory practice that Balducci felt was missing at his prior firm.

No. 27: Mario Lamar

Firm: J. P. Morgan Securities

Location: New York, NY

Production: $3.0199 million

AUM: $135.03 million

Age: 39

Even though Mario Lamar started in the industry in his 20s, his commitment to financial advising became secured, he says, only years later when he had children. With the new demands and excitement at home, Lamar recognized a financial advisory career as fulfilling and flexible for family life. Its as if you own your own business, he says. You just run it out of a larger organization.

Lamar believes the key to success as a financial advisor is staying focused. We have stayed disciplined. We dont try to vary from our two guiding principles; preserve capital and stick to gold-standard relationships, he says.

The we Lamar is referencing is his long-time advisory partner Carlos Ferrero Bonzon. Together, the two have successfully persuaded their largely ultra-high net worth, real-estate industry clientele to invest in equity, despite that groups desire to preserve capital, not growth wealth. As a result, their clients have put some of their assets into master limited partnerships (MLPs) which offer the tax benefits of a limited partnership but with common stock liquidity. Lamar individually manages $545m in total, including those investments not custodied at JPMS.

Lamar and Bonzon have worked together for 15 years, even though Bonzon moved to Florida two years ago. They continue to operate seamlessly, despite the distance. Weve had younger people rotate in and out, Lamar says about his team, but the core has stayed together. If he and Bonzon stay focused on their goal of preserving clients capital, Lamar says, they will also continue to win premium fees for the investment advice they deliver.

No. 26: Greg Cash

Firm: Merrill Lynch

Location: Charlotte, NC

Production: $3.0216 million

AUM: $1.85 billion

Age: 37

When Greg Cash was casting around for his first job out of college, he had offers. Some higher than the $24,000 salary he accepted from Merrill. But to Merrill he went, starting as a solo practitioner, and eventually joining the practice of Charlie Wickham and his son, Mitchell.

"The ability to control your own destiny -- I think that was a major component of it," Cash says of his decision to become an advisor. "It's more like you own your own business in our space."

Now a managing director, Cash helps lead a team of 12, serving more than 40 ultra-high net worth clients, personally overseeing more than $1.8 billion in assets.

The practice didn't always cater to the $10 million plus crowd. Cash estimates that about six or seven years ago, he and the Wickhams surveyed their business book and observed that roughly 20% of their clients accounted for 80% of their revenue. At that point, he explains, it simply made sense to narrow the focus of the practice and trim the number of accounts. So Cash and his partners began transitioning lower-net worth clients to other advisors while stepping up the level of care and services they provide to their ultra-wealthy customers, many of whom are business owners.

Now it's not uncommon for Cash to spend half a day meeting with a single client or his family. And the most rewarding part of that higher-touch approach? "Being intimately involved in their life," he says.

"They value what recommendations we have for them that go well above and beyond the specific investments we might recommend, he says. It's almost like you're going from a service provider to a trusted advisor."

No. 25: Carlos Ferrero Bonzon

Firm: J. P. Morgan Securities

Location: Palm Beach, FL

Production: $3.0217 million

AUM: $136.32 million

Age: 38

One of the first client prospects whom Carlos Ferrero Bonzon ever set his sights upon took a very long time to come to the phone. Bonzon regularly cold called the man who was very active in real estate and very liquid, says Bonzon, and who the JPMorgan advisor had selected because he was rich. But Bonzon only got the secretary. The prospect would never come to the phone or return the call. Finally one day, proving that persistence really does pay, he answered and gave us a small account, Bonzon recalls.

In the ensuing years, the relationship blossomed. The client now invests about $100 million of his assets through Bonzons team, which includes his long-time partner Mario Lamar. Bonzon (who manages a total of about $545 million, including assets held outside of JPMS) says the client taught us a lot about what we know today. Perhaps most crucially, because of that client, Bonzons team began to specialize in clients who made their wealth in real estate. Doing so, Bonzon, who moved to Palm Beach from New York almost two years ago, has meant staying in fixed income products, since his clients, dont want us to make them wealthy, theyve already done that, he says.

Instead, the clients want Bonzon to preserve their wealth. As a result, much of the production he generated in the past year comes from transactions related to risk-averse products, which these days include bonds, Master Limited Partnerships and, in the current low-interest environment, some high-dividend-paying stocks.

No. 24: Scott Thisted

Firm: Merrill Lynch

Location: Cherry Creek, CO

Production: $3.022 million

AUM: $457.21 million

Age: 38

At a time when many advisors are moving toward large teams with a high degree of specialization, Scott Thisted is committed to maintaining a small-scale, full-service shop that caters to a narrow band of high net worth clients.

"I love the boutique feel of our team, says Thisted. I know there's a lot of great teams out there that are huge. I never want to have someone on my team who's just managing people. I want everyone client-facing all the time as best we can. I think that's what our clients expect from us."

Thisted describes his practice as a "vertical team" with two partners and three support staff. The group caters to corporate executives, business owners and wealthy families, often helping see them through major transitions, such as taking a company public, selling a business or entering retirement.

If anything, Thisted would like to see his practice trim the number of accounts it maintains. Asked about his growth plans, he explains that he would like to bring on two to three "large, impactful clients each year" -- those with holdings in the $20 million to $25 million range -- while transitioning smaller accounts to other advisors.

Thisted believes that crafting a customized portfolio is an important competitive differentiator for his practice. "We find a lot of people we compete against just follow models," he says. "We will build a custom portfolio for that client. We certainly think that each client is different."

No. 23: Carl Cafaro

Firm: Merrill Lynch

Location: Newton, MA

Production: $3.08 million

AUM: $515.36 million

Age: 37

Ask Carl Cafaro about his favorite part of his investment advisory practice and he'll talk to you about helping people achieve their goals, seeing them through major transitions, and helping them shape their legacy. Managing clients' portfolios, essential as it may be, is not what animates him.

"That's not what drives me and motivates me and gets me up in the morning," Cafaro says. "We've never just been about the asset side of the balance sheets. We've always talked about overall goals and overall objectives, on a very behavioral level."

Cafaro began his financial services career at Fidelity Investments in 2000, but jumped to Merrill two years later to launch his own practice. Fidelity, he explains, is "a volume-driven place," one where he wasn't able to forge the deep relationships with clients that he finds among the most rewarding aspects of his practice.

"When you understand the totality of a client, you're really able to understand them beyond numbers on a spreadsheet," Cafaro says. "At the end of the day, our clients know that we truly care about them."

Now, he says clients will ask him to meet with their children to talk about the importance of signing a prenuptial agreement or make a presentation to the whole family. Business owners might ask him to meet with a job applicant they are thinking of hiring.

"My mom was a teacher. Teaching's in my blood," he adds. "I think the best financial advisors are really able to teach to their clients."

No. 22: Ryan Reeder

Firm: UBS

Location: Los Angeles, CA

Production: $3.11 million

AUM: $350 million

Age: 39

Ryan Reeder is accustomed to slaughtering sacred cows. In his case, this means getting executives at fast-growing technology firms to sell their company stock in order to diversify their portfolios. Its one of the more interesting and hardest things Ive learned to do, he says, looking back over his twenty-plus year career in financial services.

The hardest case yet: convincing a client a widower in his 80s - to sell off some of the $40 million in stock he earned a quarter-century earlier when he sold his company to a large aerospace contractor. Though it was a large portion of the clients estate, he had never sold a single share. Reeder persuaded him two years ago to sell about half of it (and subsequently much more), using the logic of Lets lock in what you worked so hard for, the advisor recalls.

At the same time, Reeder suggested the client transfer $5 million of it tax-free into a trust for his three children, using his lifetime gift tax exemption. Working with the clients accountant and estate attorney, he helped the client incorporate his children more closely in the estate and trust planning process, including making his son a trustee.

That series of events was transformative, both for the client and for Reeder. After seeing first-hand how satisfying it was to work more holistically with clients, Reeder decided to re-focus his practice on similar projects. He has since met with the majority of clients to discuss trust and estates, and is now prospecting with that view as well. I had a general understanding before that client, but when youre really involved, you see how many benefits come out of that approach, he says.

No. 21: David Bahnsen

Firm: Morgan Stanley

Location: Newport Beach, CA

Production: $3.15 million

AUM: $678 million

Age: 39

When he was 20 years old, David Bahnsen founded a business management company for musicians that grew to around $3 million in revenue within seven years. When he sold the business at age 27, he so enjoyed investing his profits that he decided to make a career as an advisor.

Bahnsen liked the entrepreneurial feel of once again building a client base. Used to spending 20 hours a day working, he brought over a confidence in his ability to manage and grow a sale-based business. One thing he was careful not to bring over, however, was his old Rolodex of musicians, some of whom could be careless about how they spent their money.

I didnt want to work with anyone where I cared about their money more than they did, he says.

Now a lead portfolio manager, he requires that all his clients allow him to invest their money on a discretionary basis, an element of control that traces back to the music industry.

The line that we have in our brochure that we share with clients is that yes, we absolutely do require our clients to trust us, Bahnsen says. But what were doing in exchange for that trust is promising to be 100% trustworthy.

He no longer spends 20 hours a day working on his business, but he still gets up at 4:00 every morning to put in a 14-hour shift. He says that determination and his ability to continue to deliver for his clients will be a key differentiator for his practice going forward.

I love the business, and I love the hours I work, Bahnsen says. And until things change where I actually need to sleep, I will take advantage of that.