Viola Private Wealth was created through a buyout from Pitcher Partners in September this year. [i3] Insights speaks with the founders of Australia’s newest private wealth firm
It’s early days for Viola Private Wealth, the Sydney-based investment advisory firm that spun out of Pitcher Partners in September.
The business has certainly hit the ground running, backed by 200 high net worth (HNW) clients, $2.4 billion in assets under management, according to Sean Ward, Chief Executive Officer of Viola.
Ward, alongside the firm’s high-profile principal adviser Charlie Viola and Chief Operating Officer Andrew Levi, spearheaded a buyout deal that included leveraging key components of Pitcher Partners’ operational capability, including investment and administration services.
The arrangement ensures a seamless transition for clients and minimal disruption to day-to-day operations. Importantly, it enables the business to focus on delivering personal advice and managing bespoke investment portfolios.
A razor-sharp focus is essential if Viola Private Wealth hopes to achieve its ambitious goals, which include adding 10-12 advisers and quadrupling assets under advice over the next 3-5 years.
Viola believes the firm’s unique advice-led investment approach will help it standout in a crowded market.
“We are unequivocally investment advisers but before we even think about investments, we seek to understand a client’s circumstances, needs and objectives,” he says.
“We take a bottom-up approach and build portfolios based on what a client is trying to achieve.”
We are big believers in taking our time to get the deployment right. We believe firmly in diversification and asset quality, and ensuring portfolios reflect the client’s actual needs, objectives and capacity to accept risk – Charlie Viola
When it comes to strategic asset allocation, the firm subscribes to Pitcher Partners’ house view.
Capital is allocated across three-to-four buckets, each designed to serve a different purpose and carrying varying degrees of risk.
For clients with “fresh capital” to invest, the process can take 12-18 months, depending on a range of factors, including market forces, timing and opportunity set.
Funds earmarked for the low-risk bucket are deployed relatively quickly, primarily into fixed interest, so it can start generating revenue.
Capital earmarked for higher risk buckets is deployed more gradually into asset classes, such as equities and alternatives, including private credit and syndicated property.
Existing Capital
For clients that come to Viola Private Wealth with an existing portfolio, changes are only made if the firm identifies a mismatch between what the client is trying to achieve and what the portfolio is set up to achieve.
“We are big believers in taking our time to get the deployment right. We believe firmly in diversification and asset quality, and ensuring portfolios reflect the client’s actual needs, objectives and capacity to accept risk,” Viola says.
The firm’s highly personalised approach, which does not mandate the use of a preferred investment platform or model portfolios, empowers its experienced advisers to exercise their professional judgement when providing advice and recommending solutions.
Liquidity is not a key consideration, which enables the group’s HNW clients to access to a broader range of investment opportunities, including private credit and private equity.
“Liquidity is the most overused reason for limiting exposure to private assets, especially in private wealth because clients have a long-term time horizon and access to more money than they will ever need,” Viola says.
Liquidity is the most overused reason for limiting exposure to private assets, especially in private wealth because clients have a long-term time horizon and access to more money than they will ever need – Charlie Viola
“The purpose of liquidity is not so clients can fund their lifestyle but so they can buy assets and take advantage of investment opportunities.”
While Viola Private Wealth has a broad and diverse client base, with investable assets anywhere between $5 million and $100 million, its ideal client has around $15-25 million.
The majority are SME business owners, senior executives and investment bankers. They are primarily self-made, first-generation success stories, much like Viola himself who cut his teeth working in CBA’s premium banking unit before being tapped to help mid-tier accounting firm Moore Stephens establish a financial planning arm in 2003.
The Merger
In 2015, the Sydney offices of Moore Stephens and Pitcher Partners merged.
Viola recalls exhausting every ounce of his energy, creativity and charisma in those early days at Moore Stephens.
That period was a particularly difficult time in the history of Australia’s manufacturing industry.
He remembers travelling around the country and speaking to rooms full of people who had been made redundant, as manufacturing and chemical plants across the country closed.
He cold-called outplacement agencies asking for referrals, educated people about their options, and helped them invest their redundancy cheques.
Many of those people are still his clients today.
According to Viola, when God was handing out gifts, Viola was given the ability to make complex things simple. Far from being annoyed he can’t sing or dance, he attributes his ability to simplify complex matters as central to his success.
This skill has opened doors for him to explain complicated employee share schemes to senior executives at large companies, and go on to convert them into loyal, longstanding clients.
For many clients, a big chunk of their wealth is the family business and/or company shares and options.
This forms a key part of their investment portfolio.
At Viola Private Wealth, every client has a bespoke investment strategy and portfolio. Investments are typically held directly by the client.
Portfolios are formally reviewed at least twice a year, if not quarterly, and changes are implemented individually.
While other advisory firms have embraced managed accounts, the firm has no plans to change how it manages and administers portfolios.
“We get the argument for managed accounts but our clients value our high-touch approach,” Ward says.
“If we have an investment idea or like a particular stock, we pick up the phone and have a conversation with our clients about it.
“Our portfolios are not commoditised. If you have 200 clients, who all come from different backgrounds and have different needs and objectives, their portfolios shouldn’t look the same. It doesn’t sound right to me.”
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[i3] Insights is the official educational bulletin of the Investment Innovation Institute [i3]. It covers major trends and innovations in institutional investing, providing independent and thought-provoking content about pension funds, insurance companies and sovereign wealth funds across the globe.