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Adviser profile: Carolyn Gowen of Bloomsbury Wealth

Bloomsbury Wealth partner Carolyn Gowen has embarked on a mission to take her firm to the next level, through a project of self-improvement and confronting the management challenge.

Living the plan: Carolyn Gowen of Bloomsbury Wealth

Carolyn's CV

2004–present: Bloomsbury Wealth, partner

2003– 2004: Bloomsbury Financial Planning, financial planner

1995–2003: Various advice firms

1987–1995: Hargreaves Lansdown, life and pensions administrator

Professional membership/qualifications

Certified Financial Planner

Chartered Wealth Manager

Chartered Fellow of the CISI

 

Living the plan: Carolyn Gowen of Bloomsbury Wealth

Carolyn's CV

2004–present: Bloomsbury Wealth, partner

2003– 2004: Bloomsbury Financial Planning, financial planner

1995–2003: Various advice firms

1987–1995: Hargreaves Lansdown, life and pensions administrator

Professional membership/qualifications

Certified Financial Planner

Chartered Wealth Manager

Chartered Fellow of the CISI

 

 

Top tips

Carolyn has given us the following as her five top tips. We like how they are some of the most specific we have ever received.

1. Make sure you have the right people on the bus. Hard as it might be, you have to be ruthless in ensuring every member of the team deserves their place.            

2. You have two ears and one mouth: use them in that proportion.

3. Do the work. When you are responsible for others’ addiction to food, clothing and shelter you have a duty to them to deal with it.

4. Focus. There will always be a ‘shiny new thing’ you can go chasing after, but constantly seeking this new thing will mean you never deliver on anything.

5. Do not let perfect be the enemy of good. Rarely will anything be 100% perfect, so avoid a ‘Ready, aim, aim, aim, aim’ approach.

Books make Bloomsbury better

Last year, Carolyn Gowen set herself the task of reading 100 books.

Having succeeded, the Bloomsbury Wealth branch principal is now reading Moneyball, a book about a baseball team; The Theory That Would Not Die, about probability theorem Bayes' rules; 10% Happier, about US newscaster Dan Harris; and The World Is Murder, which she is not sure whether is fiction or non-fiction. It is quite the range of subjects.

Top quote:

'I don't know if it's an age thing but about two years ago I realised I was not really learning anything outside work. So I made a concerted effort to fire up my brain again and do something different.'

Stepping it up

Gowen's full-throttle approach to learning came in handy around five years ago when London-based Bloomsbury decided to step up its business aims.

The three business owners at the time, Robert Lockie, Jason Butler and Gowen, reached out to Rob Stevenson from business consultancy Kingmakers. He helped the trio create a 10-year business plan. 

This gave the owners more time to manage the business, which led to a realisation...

Top quote:

'Managing a business is not sexy, it's not exciting, most of it is bloody dull and dealing with employees is difficult.'

Taking charge

For Butler, Gowen says, this new structure to the business was like a straitjacket.

In 2015, Gowen and Lockie bought Butler out and he left Bloomsbury. At the time, he told New Model Adviser® he had less enthusiasm to work in the business and felt it was no longer his calling.

For her part, the realisation led Gowen to put her love of learning to the test. ‘I’m not a natural manager, I don’t think any of us were,’ she says. ‘But I knew I had to get to grips with it because it’s so crucial. So I think I googled “managing people” and found a podcast called Manager Tools.’

Presented by former US Military Academy officers Michael Auzenne and Mark Horstman, this weekly podcast shares career advice to help managers become more effective. And when Gowen discovered the podcasters would be holding a conference in London, she booked herself a place.

Top quote:

‘Since then everyone who manages people at Bloomsbury goes to that conference.'

La belle vie

The new streamlined approach to running a business has led to two things. First, Gowen is able to work from her home in rural France for three weeks of the month without disrupting workflow.

Animal lover Gowen and her husband left the UK in 2007 to renovate a farmhouse in southwest France, where they own sheep, goats, horses, cats, donkeys and dogs.

This has meant that, for the moment, the business does not need to replace trainee Martin Cannon, who left at the end of last year. Wealth planning executive Emma Stalkartt is now level four qualified and will be certified next year. And the roles of wealth planning assistants Tania Puente Rivera and Luisa Rua Estrada have increased to include Voyant cashflow planning data entry and the creation of basic financial plans. Audrey Wilding has also been brought on as operations and marketing assistant.

Top quote:

‘I’m lucky to be able to do that. But I also think it demonstrates to clients that as a lifestyle business we don’t just talk about people living the lives they want to live. We’re actually doing it ourselves.’

Perfect harmony

Gowen may not think she is a natural manager but she certainly seems a team player. ‘You have to mention Robert [Lockie] because he’s my equal partner and such an integral part of the business,’ she says.

Lockie maintains Bloomsbury’s portfolio rebalancing tool, carries out work with the investment research committee, and builds portfolio models from which he simulates historic returns.

Top quote: 

Robert Lockie:

‘I’ve worked with Carolyn since around 2003 and I’ve always found her easy to work with. We’re mostly on the same page about things but when we do have minor disagreements she’s usually right.'

‘I’m not sure we would be where we are today without her continually pushing standards and encouraging everyone to be as good as they can be.’

Fees

Typical clients of Bloomsbury are business owners or high-earning executives. They have fairly complex financial situations and an average portfolio size of around £2.8 million, although this ranges from around £500,000 to £25 million.

For its clients, Bloomsbury has two charging options: as a percentage of assets under management (AuM) that encompasses both financial planning and investment management, or a structure in which financial planning fees and investment management fees are separated.

The decision of which structure to use is left to the client. But in both cases it involves a free initial meeting, ‘which is like a first date: do we like them, do they like us?’, and a free second meeting where the advisers present clients with a financial plan. ‘They get a lick of the lolly to see what we do,’ Gowen says.

If someone then decides to become an AuM charging client they will pay an implementation fee of around £3,000 and 1.1% ongoing on the first £2.5 million. This ongoing fee, which covers financial planning and investment charges, gradually reduces and after three years there is a 15% loyalty discount.

The alternative fee structure includes the same implementation cost and 0.4% on assets being managed. The fixed financial planning fee can then be invoiced monthly, quarterly or annually depending on what the client prefers.

‘The fixed fee depends on the complexity of the client’s affairs. We know we will do most of the heavy lifting in the first one to two years so the fee will drop after that,’ Gowen says. ‘We’re very keen to pass time and cost saving on to clients.’

The investment bit (pt.1)

Bloomsbury primarily uses Dimensional Fund Advisors (DFA) so it uses pure asset class model portfolios. The team uses FinaMetrica for psychometric risk profiling of clients, looking at their emotional tolerance to risk. This is used alongside a client’s capacity for risk and their need to take risk. These three elements determine which model is the best fit. But Gowen says emotional tolerance is most important because, while you can change your goals, you can never change your emotional tolerance to risk.

Gowen says Bloomsbury has the capacity to use an ‘infinite number’ of model portfolios because they go from 0% growth to 100% growth. But she says most of her clients are clustered around the average, which is around 40% to 60% growth.

The investment bit (pt.2)

Carolyn's colleague Lockie monitors the price of all funds on a monthly basis. If a fund price moves outside the firm’s tolerance, Gowen will conduct a few sample rebalances. Rebalancing can happen at any time but Gowen says it normally ends up happening a couple of times a year. ‘Market movements will count for one and I look at everybody’s portfolio towards the end of the tax year.

‘But there was a time in 2008/2009 when I was rebalancing every month for six months,’ she says. ‘We don’t charge clients for this because we never wanted trading costs to be a barrier. So that was an expensive year for us.’

The firm has discretionary permissions so was able to do this without consulting clients. ‘Honestly in 2008 if I had to go to clients and say, “Look, I need to sell your bonds and buy more equities”, I don’t think people would have done it,’ says Gowen, giving the strategy a value tilt. ‘But we were able to do it and the clients obviously benefitted when the markets turned. But we don’t take any credit for that. All we did was get them the returns that were there for everybody. I think everyone invested in DFA funds during that period did very well.’

Despite being discretionary, Gowen says the investment management part of the business is just a commodity. ‘It adds value in as much as it’s a process and it’s a robust academically proven approach. But the financial plan is at the centre of everything. We will do financial planning without investment planning but we won’t do investment management without a financial plan,’ she says.

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