More Than Managing Numbers

Last year, the firm added a five-person advisory board, comprising, as Tucci describes them, “five of the smartest people we knew.” One member, a former VP of marketing for Elle magazine, asked who their clients were. “We knew and we didn’t know. We knew them all by name,” says Tucci. “It turns out we had done a pretty good job with women and entrepreneurs. One of the biggest growing areas of our practice is a person selling a company for $5 million to $30 million who had all their net worth tied up in that business.”

With offices in two cities and a total staff of eight people, Lexington Wealth Management attempts to make its 120 clients feel that everyone at Lexington cares about them. “Once we’ve decided to take on a client and they’ve decided that they want to hire us, they get introduced to a team of folks here at the firm,” explains Porcaro. “Everyone gets to understand all the clients and the clients understand that there’s more than one person that understands their circumstances and can service them on an ongoing basis. Then they’re met with on a very frequent basis. Two, three, four times a year, we’re meeting with the client.”

While everyone in the firm is involved in client relationships, the two principals have found a way to divide other duties that capitalize on their individual strengths. Tucci concentrates on the external relationships, meeting with potential relationship partners and networking, while Porcaro says her functions entail more of the firm’s day-to-day operations, including compliance.

Although in the last few years the firm has embraced a wealth management approach, Porcaro stresses that its original mission of providing asset management advice remains its core competency and it strives to do so without resorting to a cookie-cutter approach. As for investment vehicles, Tucci notes that the firm is not locked into any particular strategy or model and is open to using whatever works best for the client within the client’s risk tolerance, whether ETFs, mutual funds, institutional funds, private money managers, funds of funds, or any combination.

While Porcaro says all client portfolios are unique, they share a common goal of tempering volatility and reducing risk.

No One Told Me There’d Be Days Like This

When Porcaro and Tucci decided that they wanted their business to be about more than the numbers, they were setting themselves up for a series of unexpected challenges. Although neither professes any expertise in the area of art, they’ve picked up some knowledge along the way and become familiar with appraisers and auction houses.

They had one client who had about 400 paintings but really never considered their value. It turned out that both her mother and grandmother had been artists of some note and the entire collection was worth several million dollars.

Another client also had stacks of unappraised, and uninsured, paintings. He was in the midst of building his dream house but was facing a liquidity crisis because much of his worth was tied up in real estate. After having the art appraised, he was able able to use his part of the collection to finance his dream house.

Both Tucci and Porcaro have also helped clients work through emotional issues on more than one occasion, but have found that such moments only deepen the relationship. Tucci recalls acting as the moderator of a multigenerational, multimarriage family meeting where estate planning issues threatened to destroy family harmony, but ultimately they were able to come up with solutions that left everyone feeling better. “There was a lot of crying and a lot of emotion in that room,” he recalls. “Without the psychologist, I wouldn’t even attempt such a thing.”

Porcaro’s definitive client experience was another that had a connection to an art collection. This particular client had an extensive collection, and her fianc?(C), an architect, was designing a home that would be a showcase for the art. In the midst of the project he became ill and eventually died. Porcaro found herself involved in every aspect of the situation from helping find medical specialists for treatment, having the art appraised and arranging for some pieces to be sold to pay for treatment, to arranging for consultations with the wealth counselor to help resolve some of the emotional issues. “You do what you do and pull in all the resources that you can,” she says. “If you have a good relationship with a client and they trust you, they ask you to help them in everything in their life.”

For a firm with only eight peopple–nine including the psychologist/wealth counselor–helping with everything in the client’s life would seem to place a limit on the number of clients that could be handled properly. Tucci acknowledges that could happen at some point, but is sure the firm hasn’t even begun to approach that number. To help manage the range of services and focus on client service, Porcaro notes that the firm outsources functions like conducting due diligence on money managers to keep the service level high without having to add additional staff. Both partners also understand, however, that they do need to add professionals to the firm in order to deliver service at the level they desire while still continuing to grow. Toward that end, last year they added two new advisors, Gary Pomerantz and Adam Kerr, who each bring with them a decade of experience, and plan to make whatever other adjustments the business demands. And they’re always going to look at more than the numbers.