It is hard to imagine a family office with 20 years of history getting a makeover, but that is just what Sandaire has done over the last few years.
A new chief executive officer, chairman and chief operating officer have all joined this year, while the chief investment officer was appointed in December 2016. The company has also completed the integration of Lord North Street, following its 2014 acquisition, and all signs show that it is ready to move forward.
‘I’m in soak-up mode,’ admits James Fleming, the CEO who has been on the job for only three weeks.
He says that it is still too early to have a clear vision of what he wants to accomplish, but he has some early ideas.
‘It’s a really interesting time to come into the business when you have a 20-year history – for me it has a great foundation,’ he says.
‘I’m talking to everybody across the business. In that sense one of the most interesting people to talk to is our founder [Alex Scott]. We already have an international presence in Singapore. And I know there is an element of ambition in the family to see if we can replicate that in other key centres.
‘We’ve got ideas to do other things outside of the country. With that background as well as what is going on in the UK wealth management market, there is a lot to look at.’
Escaping the ‘closing of the jaws’
One of the real challenges he highlights for a company such as Sandaire is to ensure the business model makes economic sense.
‘We are seeing a period that accountants call a “closing of the jaws”, where revenues are compressed and costs continue to rise. And those are costs across the board - the cost of technology or regulation or just general costs. We have a real challenge there to keep our model going but on an economic basis.’
In response, Sandaire, working with an external partner, has developed an operating platform. He says it is a positive step for the company because ‘it means that we can focus on what we are really here to do, which is look after clients and families’.
The firm also hired Andrew Waldren back in April as COO to help it adopt new technology to respond to future client needs. Six months in, Fleming says that he has already made significant positive contributions to the business.
‘I think for anybody who is client facing they need to know they have a really solid operational side of the business and Andrew is in charge of that. He’s improved us across the board.’
Times are changing
While Fleming expects growth in the business to come through a number of channels, with client acquisition, he says the company has been receiving an increasing number of inquiries through the internet.
‘That’s a reflection on how the social environment is moving to ease of online access. The best inquiry is from a happy client introducing a friend.’
The minimum for a family to become a client of Sandaire is around £25 million and while saying that he would see no reason to reduce it, Fleming adds: ‘We are in the early stages of looking at all these things.’
Fleming admits that there is increasing competition in the industry and companies need propositions that set them apart from their peers.
He believes that the unique aspect of Sandaire is that a founding family is at the heart of this business. ‘It gives us a competitive edge because we can sit down with other families and bring Alex into the conversation. It gives a different element to the story.’
He adds: ‘Wealth management is evolving in many different ways. I was at a very interesting talk about the evolution and development of robo and artificial intelligence working its way into the wealth management sector recently.
‘We know what the economic situation is. It’s not an easy economic background, but at the same time there is a lot of innovation and initiative being taken in the private sector. I see it in smaller companies developing around the country. And I think wealth creation continues at a good pace.
‘There are issues on the horizon, be it Mifid II, be it complying with all aspects of regulation. You have to manage that sensibly. There are issues around Brexit, there are issues in the economic environment. I see opportunities out there as well as issues. It’s a challenging business environment across the board, but we are well-equipped to face it.’
Sandaire in Numbers (year to December 2016)
Turnover: £6.6 million, (2015: £7.1 million)
Profit before tax: £1.7 million (2015: £293,000)
Assets under management & advice: £2.8 billion