Consistency is king: insights from our partnership with Skerritts

When the appointment of Paul Feeney as the new CEO of Skerritts was announced at the beginning of April, it was clear that the Hove-headquartered wealth manager was entering a new era. Since investing in Skerritts in 2021, we've supported nine acquisitions, working with founder Richard Skerritt to create one of the leading wealth management brands in the South of England. The next step is to turn it from a regional name into a national powerhouse.

Before we make an investment, we spend a considerable amount of time researching the sector and building relationships. When we invested in Skerritts two years ago we had been speaking to owners and managers in the wealth management market for a decade, and during that time we came across a number of operating models. These include:

• A range of adviser engagement models, from fully self-employed to fully-employed
• Use of a single investment management solution versus businesses which outsource their investment management to a number of different providers
• Acquisition structures that range from 100% day one purchases, to 'downstream buyout' models where the acquiror purchases a minority stake and then acquires more equity over time based on certain criteria
• Acquisition integration models that vary from fully homogenizing the entire group with transparent and cohesive back-office functions alongside a consistent advice and investment management service, to the opposite extreme of only sharing the same name in the shareholder register!

All of these approaches are perfectly viable ways to run a wealth management business, but one quality that separates the best from the rest is consistency. The aim of an independent financial advisor or wealth manager is to provide clients and their families with a holistic plan to meet their financial goals over the short, medium and long term. The advice provided to clients should be clear and transparent, enabling them to understand the decision-making process, and the interaction between their life decisions and the cash flow plan their adviser has put in place for them.

A high-quality wealth management group ensures that clients with the same risk parameters, lifestyle and cash flow objectives receive the same advice and investment returns, irrespective of the advisor they work with or the office they receive the service from.

Similarly, acquired companies should also receive the same consistent approach in terms of integration and deal structure, with the outcome for the client put at the centre of all decision-making, and a fair result achieved for all. This was certainly the approach we took with Skerritts and their acquisitions, most recently Mercier Allen and Equinox Wealth.

Following the outstanding work of Richard over the years and now under Paul's leadership, we are very excited for the future. We will continue to scale Skerritts as a tech-enabled wealth management group with the clear goal of providing a consistent, high-quality service to all of our clients. In the wealth management sector, consistency is king.