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Combining Business and Family

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Mitchell Frank has driven down for our lunch from his office in White Plains, in suburban Westchester County.

“It’s nice to be out of the office,” he admits.

Even though he works alone — sharing office space with his wife, a divorce lawyer, and another independent FA — he doesn’t seem concerned about not being there to answer his clients’ queries. Reassuringly, he taps one of those large late-model Blackberries that is hooked to his belt.

“Those things have been extremely useful to financial advisors. Whenever a client needs anything, he just shoots me an e-mail. I wish they had invented a series of different ring tones that alert you: very urgent, extremely urgent, most urgent,” he laughs.

But “those things” have also made financial advisors reachable 24/7. His client base, which consists of high-net-worth individuals as well as corporate clients whom he advises on pension plan allocations in partnership with John Hancock, is extremely diverse geographically. He has clients up and down the United States as well as in Europe, with a substantial number in Tennessee, of all places.

Frank, who is 63 years of age, has a young family. His son Jonah is a third-grader. How does he cope with round-the-clock availability? After all, even though Frank focuses on asset allocation and a long-term investment approach, clients constantly have urgent concerns which require his immediate attention.

“Having 35 years of experience in the financial services industry certainly helps,” says Frank. Having seen pretty much every situation, he is able to reply to e-mails, handle problems and put out pretty much every fire even if he is at dinner with his family.

Although some 70 percent of his practice is represented by fee-based business, Mitchell says that the fashionable trend of financial advisors becoming life coaches to their clients hasn’t affected him much. He agrees that if you handle a person’s money, you have no choice but to become involved in his life, too, but he prefers to stick to financial advice. Tax implications of various investment decisions are as far afield as he is willing to venture.

“As for the rest,” he laughs, flashing his impish sense of humor, “my wife is the divorce lawyer. I’m always willing to refer a client to her.”

Back on the serious side, Frank says that he would of course help a friend with advice, and many of his clients are friends. As part of marketing, he also does his fair share of schmoozing with clients and talking about all kinds of issues.

“Still, my specialty is money and investing,” he says. “This is where I can effectively add value.”

A Busy TimeAnd what about family vacations, does he still stay on call even when he and his family travel abroad? A globe trotter, Frank has been to over 40 countries around the world.

“I still get all the e-mails,” he shrugs. “But unless it’s really urgent, the problem will just have to wait. Even if an urgent matter arises, I’m more likely to instruct my Raymond James branch how to handle it.”

Although lately, Frank admits, he has not been traveling as much as he used to. And his practice, too, has been growing very fast lately.

An old hand in the industry, and a life-long investor, Frank started a career as a financial advisor to individuals relatively recently. He joined Raymond James in 1998, having worked for Chase, Nuveen, Oppenheimer, Smith Barney and Nomura Securities, but for most of his carrier he was on the institutional side and in the taxable bond department.

His timing for striking out on his own as an FA was extremely fortunate. He hung out his shingle just about when the U.S. stock market started to recover from the early-2000s downturn. He admits to having a lot of time on his hands when he first started, but this has not been the case more recently. The market has been great, allowing him to harvest, and his clients have seen great returns measuring in the 20 percent to 25 percent range. Moreover, Frank admits that it helps your marketing effort as an FA to high-net-worth individuals if you happen to live in Greenwich, Conn.

“Every third person you meet there runs a hedge fund,” jokes Frank. “Or at least says he does. It’s hard to talk to somebody for a few minutes without emerging with a solid business prospect.”

The result has been that Frank has been pretty busy. So much so that he is looking to hire his first employee. But, while an assistant would handle administrative tasks, Frank doesn’t expect to spend any less time talking to clients. Because this is the only way to make them feel that he keeps a close watch over their money and that they get the kind of service they are entitled to.

A Market for FA PracticesHandling clients’ pension plans and retirement savings is one thing. And what about his own retirement? He has built a thriving practice which generates considerable income — but will it have much market value when he retires?

“I could definitely pass it on,” he shrugs. However, aside from an eight year-old who is a bit too young for a Series 7 license, Frank has two grown kids from a previous marriage who do not seem interested.

“I believe that eventually a market for FA practices will develop,” he muses.

It will be a bit tricky, he admits, since the industry is still growing and evolving. Still, he thinks that eventually it will be possible to sell a financial advisory practice just as doctors have been able to sell their practices for two hundred years. Of course, you can’t sell a practice cold, since the attrition rate for his clients, for instance, would be as high as 70 percent if a new advisor just materializes out of the blue. He estimates that there will be a need for at least a year of breaking-in time.

Besides, Frank loves doing what he does and he wants to keep doing it as long as he physically can. He is perhaps a little unusual for the new breed of FAs, who spend a growing proportion of their time on marketing and client interface while letting the broker-dealer make investment decisions. Frank seems to be good at marketing, combining as he does a professorial manner and boyish charm. But he loves picking investments, too, and spends around 30 percent of his time on making investment decisions. He doesn’t do in-depth analysis on individual companies, but he pays close attention to a handful of analysts whose opinions he has come to trust over the years.

Also unusually for an FA, he is not particularly optimistic about the near-term prospects of the U.S. economy–and he doesn’t hesitate to voice his opinion.

“It’s been a great run,” he says, “but as sure as we’re sitting here there will be a correction.”

He sees the domestic economy already slackening and his investment focus for a number of months has been on foreign markets. Foreign markets have done very well and U.S.-based investors have also benefited from the weakness of the dollar.

“When the correction does come, it is going to separate men from boys,” he prophesies.

Things may get a lot busier for him and his Blackberry.

Who: Mitchell L. Frank, Financial Advisor, Raymond James Financial ServicesWhere: La Giara, 501 Third Avenue. New York on May 11, 2007When: May 11, 2007On the Menu: Potato gnocchi with fresh tomato and mozzarella (and keeping in touch through your Blackberry).

Alexei Bayer runs KAFAN FX Information Services, an economic consulting firm in New York; reach him at [email protected]. His monthly “Global Economy” column in Research has received an excellence award from the New York State Society of Certified Public Accountants for the past four years, 2004-2007.


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