Several companies in the wealth management space have tried to go public and eventually retreated from that endeavor. Take Envestnet, CI Financial’s U.S. wealth business, Dynasty Financial Partners, AssetMark and others. AlTi Tiedemann Global is one of a few registered investment advisors currently trading in the public market.
In a recent discussion during WealthManagement.com’s RIA Edge West conference, CEO Michael Tiedemann described it as a “thankless” process, one that “taxes labor at all levels of your firm.” About a year and a half ago, Tiedemann merged his New York–based RIA and alternative asset management firms, Tiedemann Group and TIG Advisors, with London-based asset manager, merchant bank and global multi-family office Alvarium Investments and took them public via a special purpose acquisition company.
That resulted in a global multi-family office with $70 billion in total assets operating in Singapore, Hong Kong, throughout Europe and the United States.
The process didn’t just happen overnight; it took a very specific sequence of events. And in the first year and a half, his firm has been restructuring and integrating the businesses together. There are a lot of new processes, controls and costs involved with going public.
“It is a heavy, heavy lift,” he said.
The SPAC raised a “whopping $980,000,” he said. But it created a permanent path for the business, with the firm merging three RIAs that they would not have been able to do without the SPAC. It expanded their footprint globally, which, he argues, is virtually impossible to do privately. In the process, the partners rolled their equity in.
“So this is not an exit. It’s really Chapter 2 of our business,” he said. “We have to prove ourselves as a public business.”
AlTi now has a credible capital partner, Allianz, to help them. In July, the firm closed on a strategic investment of up to $300 million by Allianz’s investment arm. (AlTi also received a $150 million investment from Karl Heckenberg’s Constellation Wealth Capital earlier this year, which funded two acquisitions.)
Tiedemann Advisors was founded by Carl Tiedemann, Michael’s father, in 1999 as a trust company, originally known as Tiedemann Trust Company. But the family history goes back even farther.
Michael’s grandfather died by suicide during the Great Depression. He went bankrupt in Cleveland, Ohio, having run the largest horse blanket business in the area.
“My father then spent the rest of his life really wanting to build up the Tiedemann name and being an optimist and business builder,” he said.
His father was a founding partner and later president of the renowned Wall Street investment bank Donaldson, Lufkin & Jenrette. Carl’s grandfather was chairman of American Tobacco, and when he passed away, he left a trust to his mother worth $100,000. When Carl inherited it 40 years later, it was still worth $100,000.
“He was shocked at how bad the service was, and he said, ‘There’s got to be a better way,’” Michael said.
That inspired him to create his own open architecture trust company.
“So we’ve added more value to families with our trust company and having it fully integrated with investment teams than anything else that we’ve done,” he said.