The new president and CEO of WHV Investment Management is intent on substantially growing the $14 billion San Francisco-based money management firm. To do so, however, he must prove he can meet his goal of attracting multiple new investment teams in non-traditional asset classes.
Andrew L. Turner's aggressive plan comes in the midst of other management changes at WHV, which before a name change last year was known as Wentworth, Hauser and Violich Inc.
Mr. Turner said his goal is to attract one to two specialized investment teams a year for the next three to five years in order to reach $50 billion to $100 billion under management.
That would be a big change for a firm that dates to 1937 serving the fixed-income needs of wealthy individuals. The money manager branched out to institutional clients in the mid-1990s after launching an international equity strategy. About half of its assets now are institutional.
WHV now has abandoned its roots entirely, axing its fixed-income business in favor of international, global and domestic small-cap equity strategies.
Mr. Turner took over in January, replacing Judith Stevens, who retired after 38 years. Ms. Stevens was president for the past 13 years, and was CEO as well during the four years before she retired.
Mr. Turner had been chairman of Northern Lights Capital Group, a Seattle firm he co-founded that takes capital stakes in boutique money managers and provides them with strategic support. This funding can enable investment teams to be “lifted out” from another firm or to start their own business. He remains a Northern Lights board member.
Another key change came in April, when W. Kurt Hauser, the company's executive chairman and former CEO, retired. He was the last person to leave whose name was part of the firm's old title.
The bulk of WHV's assets are in a $10.5 billion international equity portfolio, a $700 million global equity portfolio and a $2 billion domestic small-cap equity portfolio.
Two equity strategies have been dropped: domestic midcap, which had $12 million; and domestic large-cap growth, which had $10 million. The last fixed-income strategy — a $100 million short-duration bond portfolio — was dropped more than a year ago.
The changes, along with the decision to hire Mr. Turner, were part of a reassessment by officials of Laird Norton Co. LLC, the seventh-generation family-owned Seattle company that acquired WHV in 1994, said Jeffery Vincent, Laird Norton's CEO.
“The question we asked is, how do we remain relevant to our clients,” he said in a telephone interview earlier this month.
Mr. Vincent said Laird Norton officials wanted WHV to move into new areas and Mr. Turner's background helping investment firms grow made him a good fit for the job. He said Mr. Hauser was part of the effort in 2012 to bring Mr. Turner to the firm after Ms. Stevens said she was going to retire. He said Mr. Hauser also wanted to retire in 2012, but stayed on until Mr. Turner was settled in his job.
WHV has also seen some staff reductions.
The head count has gone to 50 from 60 this year through a combination of terminations and attrition. Those leaving included Jeffrey Romrell, an executive vice-president who served as a managing director of business development, heading the firm's sales and client relations efforts.
Mr. Turner said some of those who left did not fit into the plan to expand into more specialized equity asset classes, such as emerging markets, as well as alternatives.
He said he would aim to keep WHV at the $50 billion to $100 billion AUM level because beyond that, firms are difficult to manage and employees lose sight of putting the investor first.
Attracting multiple teams that offer specialized investment abilities won't be easy, said Janie S. Kass, managing director at Margolis/Kass Advisors Inc., a money management consultant in San Francisco. “It's quite ambitious, especially for a smaller firm.”
Ms. Kass said there's strong demand for specialized teams, and smaller firms are often at a disadvantage because they can't offer the larger distribution network a team might want. She said investment teams want to know that a firm has the capability to grow their strategy, because the money they ultimately make will depend on the amount of assets the strategy gathers.