Gore Browne Investment Management may be in expansion mode with the launch of a Lancaster office, but the firm’s founding duo has said it wants to avoid the mistakes larger firms are making - not least centralisation.
The company, which was launched in 2004, has achieved annualised growth of 15-20% and increased its assets under management to £230 million, director Bertie Gore Browne (pictured) said.
However, he stressed his intention that its investment managers retain control of how they manage money rather than imposing heavily centralised control from head office.
‘We want to avoid something that is happening in larger companies where they apply an investment process in which the staff are not active participators,’ Gore Browne said. ‘If you take that away from people in our industry they just become push-button people.’
Director Simon James added: ‘We don’t centralise decisions that affect clients and we don’t impose investment decisions from the centre on anybody. We do ours through an internal open-sourced idea generation investment process. It’s extremely important everyone participates because it creates a greater sense of ownership.’
While the size of the firm allows for the investment process to be decentralised and individual managers to have significant input, being a small boutique has also brought about its own challenges.
‘Clearly, five years ago we were a very small business, and that deters new staff from joining because some people prefer to work for larger companies. They also probably feel that their clients would prefer to be managed within a larger company on the back of perceptions of resources and knowledge,’ Gore Browne said.
‘But none of that holds much water. I suspect as we get a little bit larger, we might get over those particular hurdles.’
Both directors are keen that the company continues to grow steadily and dismiss much of the recent M&A activity in the sector as shareholder-led in the hunt for growth.
‘People say the growing amount of M&A in the industry is because of the retail distribution review, but I am not so sure. I suspect it’s just as much to do with shareholder pressure to see the firms continue to grow. It doesn’t necessarily mean they can grow in a way which is good for their insiders,’ James said.
‘If you’re a large or listed company, there are other people to feed.’
Gore Browne added: ‘It’s our view that we would like to remain independent as we look forward, and because quite a few of us are already in our fifties, those young people need to have that sense that we won’t sell our business to the highest bidder and run when we decide we want to retire.’