The Sydney-based independent business Smythe Financial Management will merge with Minchin Moore Private Wealth, effective next week, creating an advice firm catering to the intergenerational needs of affluent retirees and their children.
SFM founder Ben Smythe established the business in July 2013, after leaving the superannuation consulting firm Heffron. Fiercely independent, Smythe obtained his own Australian financial services licence (AFSL) and set up a flat-dollar, fee-for-advice offering. The decision to merge was brought about by the growth of the business, but Smythe says it was not an easy one to make.
“When you set up on your own, you are a bit of a control freak,” Smythe says. “It’s difficult to merge, because it’s difficult to get your head around going from 100 per cent of something to a much smaller number when you join a larger group. But I set this business up to deliver that best-of-breed service to clients. I’ve reached the stage with my business now, with the 100 families we look after, where it’s becoming harder and harder as a sole practitioner to continue to deliver that high-quality advice.”
Smythe’s business “targeted a market that no one else has really targeted”, he says – professionals in wealth accumulation phase – and “ignored the retirees almost completely”. As a result, SFM’s business complements Minchin Moore’s, which is focused more closely at affluent retirees.
Smythe says his firm and Minchin Moore are philosophically aligned, both operate on fee-for-service, receiving no commissions; their investment approach and being of similar ages.
“We’re all early 40s, all pretty young and aggressive still in terms of trying to build our businesses and make a difference,” he says. “But it’s got to stage now where I look forward and I’ve pretty much reached my capacity in terms of what I can do.
“Do I bring other partners on? Do I look to merge? Do I look to sell? That isn’t an option given my age and where I’m at.
The impetus for SFM to merge with Minchin Moore came about through an old school friend of Smythe’s, Charlie Perkins, whose own advice business, Perkins Portfolio Management, in Orange, NSW, merged with Minchin Moore in 2016.
“He was a sole practitioner, like me,” Smythe says. “I was complaining about small business and being a sole practitioner and all that stuff, and he said if you’re ever interested in a chat we’d love to have a chat with you. That’s where it started.”
SFM will rebrand as Minchin Moore, Smythe will become a partner in the expanded firm, and he will close his original Brookvale office and move to Minchin Moore’s Mosman location. Smythe’s clients and staff will move across to Minchin Moore.
“The partners run their own business,” Smythe says. “I’ll continue to run my business with a shared and scalable, more robust process and business around me. The other thing that’s attractive is the investment piece; they run a managed discretionary account, and for businesses that are looking to grow, getting some efficiencies in investment implementation is just critical these days.”
Established as Minchin Private Wealth in 2010, Minchin Moore has grown organically and through previous mergers, to have six partners and 14 staff in Sydney, Orange and New England.
In a statement, Minchin Moore founder and managing partner Mark Minchin said the firm was “attracted to SFM because we felt Ben would be a strong contributor and partner, but also because we could see our capabilities were complementary”.
We are typically looking after the high-affluent, retired parents; while SFM are looking after their high-trajectory, professional children,” Minchin said. “Through our merger, we create an enhanced capability to deal effectively with multiple generations – often within the same family group.”
Minchin Moore obtained its own AFSL about two years ago and Smythe says that was a critical consideration in deciding to merge his business.
“I didn’t want to have any perception – whether it’s reality or not – any sort of perception that we are constricted or restrained in what we can advise on,” he says. “I can sit in front of a client and they do not think to themselves, ‘Why is he recommending we do this, is there some kind of hidden agenda?’ Being self-licensed just takes that off the table.”