Almost two years after leaving the brokerage business behind, Bruce Kagan, vice president, risk management, with Gluskin Sheff + Associates Inc. and former CEO of Macquarie Private Wealth Inc. (both based in Toronto) is finally feeling at home in the investment-counselling world as a member of Gluskin Sheff’s asset-mix team and a registered portfolio manager. He is back working face to face with clients.
“I’ve always enjoyed working with clients,” says Kagan. “And I think, [with] my experience in the brokerage world, I have a lot to bring to the table because, when it comes down to it, business is business and clients are clients. They all have similarities, regardless of whether they are from the brokerage world or the investment-counselling world.”
Kagan joined Gluskin Sheff in August 2011, three months after departing from Macquarie and its predecessor firm, Blackmont Capital Inc., for which he had led more than 130 investment advisors for more than six years. Now, 18 months since joining his new firm, Kagan is settling into his role, in which he oversees approximately 100 clients at the independent wealth-management firm. Gluskin Sheff has about $5.7 billion in assets under administration (AUA) for high net-worth private clients and certain institutional investors, including family offices, foundations, endowments and both public and private pension plans.
“I always enjoyed working with clients, and I’m glad that I have the opportunity to work in that role again,” adds Kagan, now 46 years old. “We have such interesting clients – some high-profile individuals and other ones who are ‘under the radar’ entrepreneurs – so it’s a fantastic client base to be working with.”
For Kagan, who has spent the majority of his career in the brokerage sector, stepping into the investment-counselling world is a welcome change. As well, it is a sector in which Kagan can see lot of similarities with the investment-advisory role he held in early his career.
“I think where I can add value is with the continued emphasis on deepening client relationships,” he says. “I emphasize the importance of getting out there and bringing in new business by, perhaps, being a little bit more aggressive in certain situations – because the brokerage world is definitely more aggressive than the investment-counselling world.”
One difference Kagan points out about Gluskin Sheff is its strong focus on partnership and the teamwork among all top executives, including Jeremy Freedman, the firm’s president and CEO.
“This is a very flat organization,” says Kagan. “[Management] isn’t concerned about titles, but more about working as a whole. I knew it would be a good fit for me because I knew the culture and the people working here. I knew I could learn a lot from them.”
Although Kagan works directly with clients, he doesn’t have to manage the money himself, which is another distinct difference from his days as an investment advisor.
“My skill set is dealing with clients; not in picking stocks,” says Kagan. “I think it’s difficult to be great at both. And while there are some in the brokerage world who have had success [at both], most people are excellent at one or the other.”
Another difference for Kagan is Gluskin Sheff’s clientele. Compared with the brokerage sector, Gluskin Sheff’s clients are in a much higher income bracket, with portfolios of $3 million or more in investible assets – a minimum, Kagan notes, that allows the firm to deal with a manageable number of relationships.
@page_break@ “We really don’t have a typical client here,” Kagan adds. “What we do for each of our clients is to let them know about the opportunities that exist out there and to personalize those opportunities the best that we can for them.”
One of the challenges for Kagan in making the career switch was finding his footing in a firm that had such a long-standing history within the financial services industry: “I normally went to work at places where I’d known the individuals for a very long time, so it really did take me some time to figure my way around, and also for people to get used to my style.”
Kagan has his own history within the financial services industry, with almost 20 years dedicated to the brokerage side. He started out as an investment banker in 1990 with Toronto-based Dean Witter Reynolds (Canada) Inc., but decided early on that he wanted to move to the retail side.
In 1992, when Dean Witter was acquired by Toronto-based Midland Walwyn Capital Inc., Kagan became an investment advisor for the first time; within two years, he made it into the Chairman’s Club. Over time, he became one of the firm’s top producers in the country, with a book of $220 million and $3 million in production. But as Midland Walwyn itself was acquired – first by Merrill Lynch Canada Inc., which, in turn, was acquired by CIBC Wood Gundy – Kagan saw his management career start to take off.
“It was at this point in my career that I knew I had to make a difficult decision and sell my business,” Kagan says. “It was hard to let go of my clients. But my passion at that time was in management and helping others achieve success. So, I decided to follow my heart.”
At the age of 34, Kagan consolidated seven branches for Merrill Lynch and became head of one of the largest “superbranches” at the firm. When Wood Gundy bought the business, Kagan moved directly into a senior management role, responsible for expanding the national high net-worth business as well as the training and development of advisors.
Moving up within a company that had experienced so many mergers was one thing for Kagan; but when Toronto-based Dundee Securities Inc. came knocking, it was the first time he jumped ship.
Dundee, which had just acquired Cartier Partners Financial Group, named Kagan as its head of wealth management. He was responsible for integrating the two firms’ cultures and 3,850 advisors with almost $26 billion in combined AUA.
The experience at Dundee led Kagan back to Bill Packham, formerly the head of both Midland Walwyn and Merrill Lynch Canada, who asked Kagan to help build the advisory business of Blackmont. When Toronto-based CI Financial Corp. acquired Blackmont’s parent firm, Kagan was asked to stay on and was appointed CEO. He spent six years building the firm’s advisory sales force to 130, who had $7.6 billion in AUA, until it was sold to Australia-based powerhouse Macquarie Group Inc. Kagan stayed on for the transition period, but, after 18 months, he knew it was time to move on.
“It was a hard decision for me to leave Macquarie, but it was just time [to do so],” he says. “Earl Evans is the right man to run that business, and he’s done an incredible job ever since. But it was really time for me to figure out what I wanted to do next.”
Kagan admits he was nervous about where he was headed. But there were several offers on the table very quickly, including some from large brokerages that once were his major competitors. Although tempted to stay in a leadership role, he says, his role today is a nice change of pace.
And looking back on his career, Kagan has no regrets: “Just because I left the brokerage business doesn’t mean that the relationships that I made will be forgotten. The influence that I had on others, as well as the effect others had on me, will certainly still be remembered for a long time to come.”
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