From the November 2006 issue of Wealth Manager Web • Subscribe!

Survival Instinct

What happens to a high-flying Wall Street career when personal tragedy strikes?

The question became all too real for Andy Kaiser on January 25, 2003, the day his six-year-old son Ryan died suddenly from a heart ailment. Ryan's disease was diagnosed at birth. But no one is prepared for death, especially when it's a six-year-old who, thanks to modern medicine, seemed to be beating the odds and living a fairly normal life.

"I cry about Ryan all the time and probably will for the rest of my life," says Kaiser, the managing partner of Mountain Hill Investment Partners, which claims a client base of institutional and high-net-worth clients. He launched the Atlantic Highlands, N.J. money management firm this past spring after much soul searching and an unsatisfying effort after Ryan's death to resume his Wall Street career at investment bank UBS.

It's said that time heals all wounds, but the truth can sometimes be more complicated. There are no timetables, no manuals for reclaiming one's professional life in the wake of a devastating personal loss. The ability to survive an emotional roller coaster, while keeping an investment career intact, depends on a variety of factors including personal discipline, the particulars of the day job, and maybe just plain luck. Trial and error invariably play a role, too. Some come to the light at the end of the tunnel quickly, but Kaiser didn't have that luxury--at least not in the first few months after January 2003.

A little more than three years later, on a recent visit to Mountain Hill's office near the Jersey shore, a visitor finds a setting one would expect for the management of accounts totaling $150 million for institutions and wealthy clients. Although Kaiser's staff consists of just one assistant, he has plans for growth and today, appears very much in control of his destiny

The headquarters for Kaiser's current and future ventures buzz with computers connected to high-speed data lines. As he talks, Bloomberg screens scroll news headlines and changing securities prices amid several other PCs hosting a variety of software packages including myTrack real-time quotes--Morningstar's equity research product--and BondDesk fixed-income service. Kaiser also has access to the back-office platforms of Bear Stearns and Pershing, along with other tools and services, by way of his broker/dealer, American Portfolios in Holbrook, N.Y.

A newly minted convert to the industry of independent wealth managers, Kaiser asserts that technology supports and nourishes Mountain Hill's three main business lines. One is a long/short equity strategy managed in separate accounts. Another is what he calls equity executions, which focuses on the trading of illiquid and restricted securities. He's also developing a third venture: Targeting fixed-income and cash management services for institutions.

Kaiser emphasizes that technology gives him the freedom to run a business for a sophisticated, international clientele, much of it drawn from relationships cultivated during his two decades on Wall Street. But if growing such a business required a mother ship in the past, those days are gone, he believes. In fact, Kaiser says that as an independent, he now has access to a superior and virtually unlimited array of trading and information services compared to the relatively limited choices available as an employee at any one financial institution.

It's no accident that Kaiser's rise in money management and trading at firms like Dillon Read and UBS paralleled the burst of innovation, wealth and technology-driven trading on Wall Street over the past 20 years. A lacrosse player who graduated from Springfield College in 1985, this Long Islander was in the right industry at the right time.

But after Ryan's death, that career quickly became a question mark. Kaiser decided to take some time off to reflect, and so he decamped to Florida with his family. Among the questions gnawing at him: Would he go back?

"Andy was always the most enthusiastic, charming guy, and after Ryan's death he was just down, and lost his self confidence," says Chris Wilson, a childhood friend who is a partner with Stonehill Capital Management LLC in New York.

Although Kaiser eventually rebounded, it wasn't immediately obvious that he'd right himself in the dark days and weeks after January 25, 2003. "We went to Florida and rented a house on the beach," he recalls. "I didn't know what I was going to do. I just wanted to hang out with my family and try to figure it all out."

During his Florida retreat, Kaiser eventually realized that he still wanted to work. But there was no road map for a comeback. He first tried going back to the old life in the city, but it didn't feel right any more. He wanted to spend more time with his family and less with commuting, high-powered meetings, and all the time-consuming chores that come with a big Wall Street job.

By mid-2003, Kaiser had asked for and received a transfer to a UBS office closer to home in Red Bank, N.J. On paper, the 15-minute drive to the office looked like the perfect solution. In practice, it turned out to be something less. Although he was still working for UBS, the price of relocating to a retail brokerage office soon became obvious.

The culture gap between the retail life in Red Bank and the master-of-the-universe atmosphere of Wall Street proved too big to bridge, he recounts. Not that he didn't give it the old college try. But transplanting a business running sophisticated trades for an international mix of wealthy individuals and institutions was tougher than it seemed in a small town. In fact, moving from an institutional trading-floor environment to a retail brokerage wasn't just culture clash--it was also bad for business, or at least Kaiser's business.

If there was hope that he could continue growing his business, and thereby maintain motivation for his career in Red Bank, it was dashed as the constraints of his experiment emerged. Instructed to just say "no" to a prospective client of more than modest means, Kaiser saw the proverbial writing on the wall.

He had been trying to secure a new account that came by way of a recommendation from an existing client. The prospective customer, the chairman of a company in India, was in need of a deft hand to unload a batch of restricted stock--one of Kaiser's specialties. He pitched his services, and soon landed a new account. Or so he thought.

Success was nipped in the bud when Kaiser's superiors in Red Bank said the account was verboten. Servicing foreign-based clients was beyond the capacity of the local office, he was told. The Red Bank roadblock was especially galling because, as Kaiser recalls, soon after hearing the bad news, he read a newspaper story about the expansion of UBS' investment banking business in India.

Kaiser's career in Red Bank was still doing well by most standards, but it was also stalled--a situation that convinced him to consider the alternatives. As he quickly discovered, the prospects for an independent-minded financial advisor with a robust client base are encouraging, if not superior, in the digital age.

In the final 12 months of his two years in Red Bank, he engineered what might be called professional salvation. Yet the launch of Mountain Hill Investment Partners this past March was more than a calculated business move. It was also a new personal beginning. Certainly it represented a new lifestyle--one that Kaiser was designing to custom fit his clientele and his ambitions for achieving something more than merely a successful money-management firm.

Starting a new business is almost always a risky venture. At the same time, Kaiser recognized that his old career was losing its allure and inspiration, he explains. New York hadn't worked, and neither had Red Bank, in part because UBS management was unsure of how to handle his business. It wasn't about money, Kaiser emphasizes. In fact, he was doing quite well in New Jersey despite the obstacles. But somehow it was no longer enough just to be comfortable.

"I came back [after Ryan's death] to the business feeling guilty about the way I was compensated, and frankly, I had a lack of interest in the process. But my results were still great, and I was still getting paid well. But I was not in it anymore for the money, and some of my co-workers didn't get it."

The Mountain Hill reference in Kaiser's company comes from the name of a pre-school business he bought in 2004 that sits atop the 12-acre plot that houses his financial firm in a separate building. The Mountain Hill School, he says with obvious pride, dates to 1949, and is among the oldest continuously operated pre-schools in the state. It was also the school that Ryan attended before kindergarten. "The vision is for the school to become, perhaps, some type of academy with first through eighth grades. In any case, the direction is for expansion," Kaiser says of the school, where his wife, Lauren, is co-director.

On a recent tour of the grounds, Kaiser pointed to dozens of new large, upscale houses in the distance. Suburban sprawl, he's convinced, would have been the fate of his relatively secluded, undeveloped acreage had he not bought it. To be sure, such a chunk of land will "ultimately be worth something in 20 years," he says, understating the potential for real estate on the Jersey shore by more than a little. At the same time, he anticipates that the property will remain in his family indefinitely.

Although he intends to run the pre-school with a businessman's sensibility, there are other considerations (and dividends) that transcend dollars and cents. "My wife brought my three-old daughter into my office the other day to say hello," he says, explaining that she's one of the pupils at the school just a 60-second walk from his trading screens. "My daughter gave me a hug, and I turned to [my assistant] and said: 'If I never make a nickel here the rest of my life, I made the right decision.'"

As the tour continued, Kaiser walked down to the edge of the property, to a barn that was part of the real estate purchase. Its current inhabitants include a donkey, goats, a few chickens and other assorted barnyard animals. Kaiser plans to build a new two-story structure to house the animals on the ground level and a state-of-the-art trading floor upstairs. He says the d?cor and style of the new building will be a mix of the rustic with the digital: animals below and technology above.

In time, he envisions a staff for his money management business totaling a half-dozen or so, overseeing assets of $600 million. "I don't think we'll be any bigger than that," he muses, explaining that too much growth could threaten the fine balance between the personal and professional that he seems to have found. In any case, he doesn't need the money, he confides. "I feel like I made my money 10 years ago."

Nonetheless, Kaiser has an ambitious agenda. In addition to building his money management firm and investing in the day-care business, he runs a charitable foundation dedicated to the memory of his son. The Ryan Andrew Kaiser Memorial Foundation (www.rakmf.org), set up in late 2003, offers financial assistance to critically ill children and their families and provides grants and funding to doctors and hospital groups that specialize in pediatric heart patients. The foundation also has plans to develop a children's park named after Ryan in nearby Middletown, his hometown.

But running a charitable foundation--his charitable foundation--can be a double-edged sword, Kaiser admits. "I'm getting to the point where people know me because I lost my son," a recognition that has "disturbed" him on at least one occasion, he says. At the same time, he's proud of the fact that his foundation is helping families with sick children. Reaching out is satisfying, he says, although the joy of aiding others is tempered at times with regret: "I don't want my life to be defined by me losing my son."

Soon after Ryan died, a friend sent him a letter quoting the German philosopher Nietzsche's observation that whatever doesn't kill us makes us stronger. Andy Kaiser may be living proof. But if he's a survivor, personally and professionally, his path to deliverance has come in part from work in all the various forms that characterize his life these days. If that inspires others struggling with personal challenge, so much the better. But for Kaiser, it's first and foremost about surviving, and on his terms. "Instead of quitting my job and sitting on a beach and mourning for the rest of my life, I threw myself into some other things."

It all comes down to the simple proposition that while there's more to life than working, sometimes work sustains, fulfills and perhaps even saves. Chris Wilson, who's known Kaiser since the first grade, sees a difference for the better in his friend's attitude since the opening of Mountain Hill Investment Partners. "After he started his new business, he came into my office to pitch his equity execution business to my firm," says Wilson. "I told him afterward, 'Andy, it was so refreshing to see you back, with your old self-confidence.' A couple of years ago, he couldn't have done that," Wilson says. "He just lost the will do that."

Work, it seems, has truly made Andy Kaiser stronger. "The busier I am," he says, "the easier it is and the healthier I feel."

James Picerno (jpicerno@highlinemedia.com) is senior writer at Wealth Manager.

Reprints Discuss this story
This is where the comments go.