Wealth manager Debra Wetherby, CEO of Wetherby Asset Management, didn’t dream of founding her own firm when she entered the financial advisory business nearly 30 years ago at Morgan Stanley. But in 1990, just as the emerging profession’s fee-only model was starting to surface, it began to sound like a good option.
“What I knew was that I wanted to serve clients in a certain way,” she says, and “I could work for myself and do it in a way that I believed in.” This included being paid for offering objective advice instead of selling products, and providing customization based on individuals’ needs. “It was really about having a practice that centered around the client,” she says.
Today, her 24-year-old independent firm manages approximately $4 billion in assets for 500 clients nationwide. Based in San Francisco with another office in New York, it’s one of the largest employee-owned advisory firms in the U.S. Most of its clients are individuals and families. It also manages some institutional assets.
Wetherby, who goes by “Deb,” is a CPA (inactive), CFA and CFP. Given her friendly, engaged and unhurried manner—and her wealth of investment knowledge—it’s easy to see why some clients have chosen to remain with her for decades.
Cultivating a mega-size firm wasn’t a top priority for Wetherby, 56. “We never focused on sales or size; we always have focused on service,” she says. “When we’ve talked about growth, we’ve always talked about it from the perspective of, how do we make sure we are not growing at the expense of our clients.”
Each year, the firm’s shareholders do an annual business plan and look at what is needed to maintain what they refer to as the five pillars of their business—superior client service; executing superbly on the investment side; operational excellence; maintaining, developing and growing human capital; and overall business health and growth. The big question, she says, is, “How much do we feel we can digest in terms of growth?”
An effective strategy has been expanding the team in advance of growth. “You really have to have the talent in place in order to serve additional clients,” she says. Today, the firm has 56 employees and 15 shareholders, most of whom are also employees. There is no shortage of young people at her firm—41 of its employees are under the age of 40.
The firm’s youth culture is built around the concept that any individual willing to learn and work can become a shareholder. “People can start at an entry level position and work their way up to shareholder if they are committed to building their knowledge, skills and abilities over time and are passionate about work,” she says. In fact, two of the firm’s current shareholders have done exactly that.
Over time, Wetherby Asset Management has also raised its minimum investment in order to take on a smaller number of larger clients. That minimum, just $100,000 at the firm’s outset, now stands at $10 million.
According to Wetherby, many of her first-generation clients created their wealth by working for a business. Being located in the Bay Area, a center of innovation, business and wealth creation, has absolutely helped.