United Capital Overview

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United Capital Overview

  1. 1. United Capital Overview September 2013
  2. 2. EXECUTIVE SUMMARY Company Snapshot • • • • • • • • • 1. 2. Established in 2005, based in Newport Beach, CA with regional support hub in Dallas, TX 91 financial advisory professionals • 2 Ph.D’s • 22 CFA® charterholders • 54 CFP® professionals 44 offices and growing $16.8 billion of assets under advisory • $8.53 billion of assets under management1 • $8.28 billion of consulting assets2 40+ acquisitions of independent advisory teams since inception 20 consecutive quarters of fee-based revenue growth $83 million of 2013 revenues (budget forecast), growing at 41% revenue CAGR since 2006 323 employees; 92 advisers; 59 Managing Directors 10,000 client households; over 20,000 accounts NATIONAL FOOTPRINT Boston Area Seattle Connecticut Buffalo Chicago Area Modesto Fort Collins Denver San Francisco Las Vegas Oxnard LA Area Albuquerque San Diego Dallas Bethesda NYC Area Nashville Memphis Atlanta Houston Tampa Area Boca Raton Fort Lauderdale As of 4/30/2013 As of 12/31/2012 2
  3. 3. EXECUTIVE SUMMARY Why Firms Partner With United Capital 3 Themes Among a Host of Individual Reasons Improve Clients’ Lives • Centralize administrative and operational functions elevate a trained team to focus on improved client experience • Access to a dedicated team of experienced professionals (CFP, CFA, MBA) collaborating to create wealth planning solutions and best practices training to ensure staff and office is running smoothly Local Growth • Proven growth and marketing strategies to grow existing client base and attract new relationships • Recruiting team to add new talent with AUM and access to capital to acquire locally Wealth Creation • Potential through equity in a fast growing, unified, national firm • From start-up in 2005 to $16B in assets and approximately $85M in revenue by end of 2013 • Simply put, a higher growth trajectory than most firms can achieve standalone with the goal of a future event at premium pricing 3
  4. 4. EXECUTIVE SUMMARY Common Traits of United Capital Partners Complete Cultural Alignment • Based on clients’ interests coming first • An advice-driven client relationship is superior • Respect and dignity with no exception, cross-office and cross-firm • Being better this Friday than the last, week in and week out Joining Will Improve Lives • Clear, decisive areas where United Capital can help are identified prior to joining United Capital’s Equity has a Higher Probability of Growth • Owning a stake in a large, high-growth company is potentially more valuable than the underlying equity of a single, standalone company Whether establishing a flagship office, tucking-in to an existing office, or a recruitment; no opportunities are pursued by United Capital unless the advisers share our vision of superior client service and solutions 4
  5. 5. Proven Platform For Efficient Growth & Scale ADMINISTRATION • Human Resources, Technology, Accounting and Compliance are centralized Administration Operations Marketing Client Services Platform Support allows offices to focus on core competencies, while improving efficiency and capacity for growth OPERATIONS • Salesforce CRM provides a backbone for client management as well as supporting United Capital offices • Centralized investment operations and research drives efficiencies, capacity and economies CLIENT SERVICES • Offices employ team-based service model and deliver a consistent, customizable planning experience using UC proprietary tools • Practice management resources and a centralized planning team facilitate a consistent client experience MARKETING • Centralized marketing and brand management with field support model • Scalable growth programs, campaign management and coaching help offices achieve new levels of growth 5
  6. 6. ADMINISTRATION Solving Back Office Worries COMPLETE CENTRALIZED BACK OFFICE SERVICES • Accounting and finance – detailed “to the last dollar” and higher level including; bill payment, payroll processing, expense reimbursement, etc • Centralized human resource team and centralized compliance process and oversight • Technology infrastructure and support with “rapid response” and scalable solutions WE HAVE UNIFIED DATA • Workstation (Salesforce.com) enables real-time reporting, trend analysis and valuable dashboards for management and users • Building robust prospect analytics and marketing automation • Administrative functions do not live in a vacuum: continuous improvement / feedback loop to ensure reliable, efficient solutions OUR PLATFORM IS TRULY INTEGRATED • Integrated platform created with the best outside partners available • Continuous investment and focus on improvements in the platform, tools and capabilities across all of the offices • Process workflows improve ease-of-use and reduce employee ramp-up time WE KEEP OUR INFORMATION SAFE • Data security and compliance management are top priorities • Tools to monitor and manage all aspects of security and compliance across the firm • Vendors meet the financial service industry’s stringent data security requirements 6
  7. 7. ADMINISTRATION Partnerships With Industry Leaders INVESTMENT SERVICES ADVICE SERVICES MANAGEMENT TOOLS 7
  8. 8. ADMINISTRATION Centralized Compliance Is An Asset Key Areas of Focus Comments / Results EMPLOYEE AND PLATFORM OVERSIGHT ONGOING TESTING TECHNOLOGY / DATA SECURITY • Maintenance of client disclosure brochure • Regulatory Filings – ADV, 13F, 13G, 13H, IAR notice filings • Policies & procedures, code of ethics, client agreements • Adjust for changes in the business • Regular monitoring of changes in regulatory requirements • Kept up to date with changes communicated across the firm Annual self-audit of firm Initial and annual protocol training for employees Advertising review Certification of acknowledgements (non-solicit / non-compete, personal securities oversight, policies & procedures, code of ethics, outside activities, etc.) • Quarterly reports completed by Director of Operations • Annual review of offices • • • • • Email, social media • Investment management (best execution, valuation, REGULATORY FILINGS & DISCLOSURE • Active oversight of electronic communication • Cross work between Compliance and Wealth Services Anti-Money Laundering, cross trades, etc.) • SEC exam preparedness • Assets and holdings archives departments – leverage various systems for efficiency • Review and test compliance with regulatory expectations • Review for quality capture of all AUM • Financial Tracking compliance oversight system • CyberU training delivery • Salesforce workflow and case tracking • Normalize data for testing and oversight • Web-based training platforms • Efficient delegation and task management tool • • • • Annual report completed and presented to Board of Directors Broad training on key regulatory requirements for all EEs Scalable advertising review process – 1,000 items in 2012 Conduct personal securities oversight of all employees through efficient and scalable systems • Local compliance oversight in each regional office 8
  9. 9. OPERATIONS Utilize United Capital Investment Platform ADVISERS DESIGN THE CLIENT PORTFOLIO • With central investment support, advisers have more time to work with existing clients and grow • Clients get custom portfolios built with expert research, recommendations and communications • Timely market insights and materials for advisers to use for distribution to clients OUR MENU IS ROBUST • Open architecture provides advisers with choice of strategies and vehicles • Solutions fit to client segments, target $500K-$5M account size and customized solutions for UHNW clients WE HAVE AN EXPERT TEAM • Team of CFAs, CFPs and MBAs design passive / active model portfolios from which our partners shape customized asset allocation • On going due diligence by research and investment committee of all ETFs, Mutual Funds and SMAs that make up model portfolios 9
  10. 10. OPERATIONS Broad And Deep Investment Support For Partners CUSTOMIZED SOLUTIONS ONGOING PUBLICATION & COMMUNICATION • Sophisticated Client Proposals: Help advisers close and retain business with complex clients • Ability and support structure to bring in managed assets from institutions, and ultra-high net worth clientele • • • • Weekly Talking Points Monthly Macro Forecast Quarterly Commentaries Interim Market Updates 10
  11. 11. OPERATIONS Partners Build Portfolios To Meet Client Needs UC INVESTMENT PROCESS • Research new ideas • Due diligence • Committee approval ADVISER • Understanding client needs and goals • Developing target allocation • Performance reviews • Select strategies to design client portfolios • Strategy development • Communicate with clients • Monitoring & rebalancing • Adjust portfolio based on client needs • Risk oversight 11
  12. 12. Offering Clients What They Want CLIENT SERVICES OUR ADVICE AND PLANNING IS UNIQUE • Custom-made advice that is scalable – and has a revenue stream • Manage the client experience to achieve the highest levels of client satisfaction as efficiently as possible (measured annually via client survey) • Manage the clients’ whole life, they aren’t just walking wallets WE ARE POWERED BY TOOLS AND TECHNOLOGY • Custom Road Map financial planning system fully integrated with Salesforce and third party financial planning software • Advice output through the Guidebook and other client deliverables is highly automated • Client tools are fun and engaging and our adviser support tools are cutting edge WE TAKE TRAINING SERIOUSLY • Extensive practice management support and best practice sharing among offices • Online training / Boot Camps for support staff and specialists are available at every stage of office growth • Implemented across all United Capital regional offices with phenomenal client adoption 12
  13. 13. CLIENT SERVICES Advice Process Is Different United Capital offers an innovative way to help clients plan their financial life, not just manage their investment returns TRADITIONAL PLANNING • Canned solutions for a client’s unique life • A static plan that rarely ever changes • Fixed assumptions about the market and the future • A non-customized model based approach to designing a plan ADVICE PLANNING • • • • PERFORMANCE HISTORY Focuses on a client’s entire financial life rather than just money or investments Choices customized to each client’s unique goals and circumstances Enables periodic course corrections as a client’s life and the world changes Highly collaborative decision making process ADVICE HISTORY 13
  14. 14. CLIENT SERVICES The Honest Conversations® System How do I think about money? What matters to me? FRIENDLY Where am I today? INTERACTIVE How do I get where I want to go? How am I doing? TRANSPARENT 14
  15. 15. Newly Integrated Guidebook – Consistency, Scalability & Customization Dynamic guidebook, reflecting the client’s unique situation Genogram outlining the client’s family tree to visually encompass who is being considered Financial assessment allows for the reasonable analysis of options available in a financial plan Money Mind® Analyzer: interactive utility that assess client’s value of money and emotions Based upon Honest Conversations® output and the financial analysis, a priority action list is developed CLIENT SERVICES Honest Conversations®: interactive in-person or webbased utility to facilitate a deeper understanding of an individual’s priorities Performance is measured relative to objectives, not benchmarks (ie: S&P 500) Honest Conversations® output: helps clients and advisers have an open conversation regarding priorities and goals before setting a financial plan Based on client objectives, risk tolerance, and timeframe the adviser utilizes the platform to generate a recommended asset allocation After further discussion with the client, an action plan is devised with the client taking ownership of the decisions 15
  16. 16. CLIENT SERVICES Making A Difference To Clients & Advisers • • • When advisers join United Capital, they learn more about their clients through Honest Conversations® Relationships become broader, deeper and more profitable The process ties the client to our firm BEFORE UNITED CAPITAL AFTER UNITED CAPITAL COMMENTS ASSETS UNDER MANAGEMENT $1.8 M $2.1 M • Planning process uncovers assets from existing clients FEE % 1% 1.25% • New advice fee REVENUE $18K $26K • 31% revenue uplift FOCUS Investments Planning • Clients are happier, they understand and feel good RELATIONSHIP Tied to Adviser Tied to Team & Process • The relationship becomes tied to the firm ENGAGEMENT Paternalistic Collaborative • Both spouses are involved and feel heard 16
  17. 17. Growing Our Partner Firms GROWTH WE APPLY SCIENCE TO MARKETING • Detailed processes, training and coaching improve field success rates • Campaign dashboards and measurements in Salesforce drive accountability • Campaign elements (list, offer, creative) adjusted based on marketing analysis to drive ROI VOLUME AND RESULTS ARE BUILDING • Over 4,500 qualified prospects representing $1.1B “highly qualified” lead AUM now being actively nurtured • Over 145 campaigns for 2013 with 50% of offices enrolled in formal growth programs WE SCALE PROGRAMS THAT WORK • Seminar series response rate is almost double the industry’s; 57% book appointments • Rolled out a national direct mail campaign with 100,000 mailers year-to-date • Lead generation program for 401k plan participants 17
  18. 18. GROWTH Multi-faceted Growth Programs Direct Mail What Can an Adviser Expect? • • • • • • • • Turn-key marketing program Customized direct mail invitation package invites consumers to a private appointment Appointment occurs in local office Includes pre-screening and appointment scheduling 2 Campaigns 4 to 6 new clients $6 million in new assets $100,000 in additional revenue Money Code Dinner Experience What Can an Adviser Expect? • • • • Turn-key program Custom, pre-approved materials Best practices training & execution support Advising Corporate Employees Program • • • Established calling program for plan participants Workplace seminars and appointments Offices opt in to participate • • 3 to 5 new clients short term, 6-8 over 18 months $6-8 million in new assets $150,000 in additional revenue What Can an Adviser Expect? • • Activity levels driven by corporate locations Each localized campaign targets $10M in assets $2M annual revenue target • Other Programs: • Formalized Referral Coaching Program • Digital Marketing nurtures all qualified leads 18
  19. 19. Campaign Discipline Drives Results Step 1 • • • • • • • • • • • Step 2 Schedule Appointments & Meeting 1 Answer incoming calls Google prospect Email prospect Money Mind® Analyzer link – use adviser’s email account Enter into Salesforce MD receives Money Mind® Analyzer results 3 Days prior: Call/email to remind prospect of importance of receiving the Money Mind® Analyzer exercise 2 days prior: Call to confirm appt, if no Money Mind® Analyzer, call to reschedule appointment Prepare Prospect Folder Adviser: Hold meeting #1 Schedule Data Gathering phone mtg Update Salesforce Data gathering • • • Relationship Manager receives statements before call Relationship Manager holds call, reviews statements Schedules meeting #2 GROWTH Step 3 Step 4 Paperwork/Transfer Funds Meeting 2 • • • • • Relationship Manager prepares score card, investment profile, cost analysis for meeting Confirm meeting Meeting 2 held Paperwork signed or follow up meeting is scheduled Update prospect and meeting status in Salesforce • • Step 5 Meeting 3 Relationship Manager receives funds/ prepares for meeting #3 Schedule meeting #3 • • • • • • Confirm meeting #3 Relationship Manager walks prospect through tutorial, investments and website Send welcome gift and personal note Add new client to client communications list Update prospect and meeting status in Salesforce Schedule review and Honest Conversations® meeting For each campaign advisers have a coaching resource 19
  20. 20. FINANCIALS Financial Highlights HIGH GROWTH MOMENTUM HIGH QUALITY ORGANIC GROWTH DRIVERS • • • • 41% Revenue CAGR since 2006; 20 consecutive quarters of fee-based revenue growth $80M+ run-rate revenues (current); $95M (year-end) High earnings quality (QoE) > 90% recurring fee-based revenue 65% of current revenues acquired; mix rapidly shifting as organic growth accelerates • Fee-based Advice creates a new and recurring revenue stream for every acquisition and recruit • Organic Net New Assets (“NNA”) from growth programs introduced in 2012 • Recruit revenues are accelerated post-transition; zero capital required and fully accretive SCALE & MARGIN EXPANSION • Core Operating Margin has increased 330% from 6% to 20% since 2009 • Accelerating efficiency; revenue/employee increased from $186k to $243k since 2009 while revenue/household has increased from $4,600 to $7,200 • Robust platform able to support 300% revenue growth PROVEN ACQUISITION PROGRAM • 40+ successful and accretive transactions since 2005 • Structured to align interests: sharing of upside and downside with discreet financial arbitrage • Performance accountability in the post-closing period aided by 12-24 month lookback/reset SELF-FUNDING: EFFICIENT USE OF CAPITAL • $5M of founders capital and $31M from outside investors • $30M of acquisition investments and $60M of platform investment  self funding • Unrealized (off-balance sheet) tax benefit (NOL) and tax shield (on balance sheet) from amortizing intangible assets 20
  21. 21. CONCLUSION Our Principles Guide Our Work… HOW WE WORK 21

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