Several companies in the wealth management space have tried to go public and eventually backed out of the effort. Take Envestnet, CI Financial's US wealth business, Dynasty Financial Partners, AssetMark and others. AlTi Tiedemann Global is one of the few registered investment advisors currently trading on the public market.
In a recent long discussion WealthManagement.com's RIA Edge West conference CEO Michael Tiedemann described it as an “unforgiving” process, one that “taxes work at all levels of your firm.” About a year and a half ago, Tiedemann merged New York-based RIA and alternative asset management firms Tiedemann Group and TIG Advisors with London-based asset manager, merchant bank and global multifamily office Alvarium Investments and took them out publicly through a special purpose acquisition company.
This resulted in a global multi-family office with $70 billion in total assets operating in Singapore, Hong Kong, across Europe and the United States.
The process didn't just happen overnight; it took a very specific sequence of events. And in the first year and a half, his firm has restructured and integrated the businesses together. There are many new processes, controls and costs involved in going public.
“It's a heavy, heavy lift,” he said.
The SPAC raised a “huge $980,000,” he said. But it created a permanent path for the business, with the firm bringing together three RIAs that wouldn't have been able to do it without the SPAC. He expanded their footprint globally, which, he argues, is virtually impossible to do privately. In this process, the partners contributed their own capital.
“So this is not an exit. It's really Chapter 2 of our business,” he said. “We have to prove ourselves as a public business.”
AlTi now has a reliable capital partner, Allianz, to help them. In July, the firm closed a strategic investment of up to $300 million from the investment arm of Allianz. (AlTi also received a $150 million investment from Karl Heckenberg's Constellation Wealth Capital earlier this year, which funded two acquisitions.)
Tiedemann Advisors was founded by Carl Tiedemann, Michael's father, in 1999 as a trust company, originally known as Tiedemann Trust Company. But the family history goes back even further.
Michael's grandfather died by suicide during the Great Depression. He went bankrupt in Cleveland, Ohio, after running the largest horse blanket business in the area.
“My father then spent the rest of his life really wanting to build the Tiedemann name and being an optimist and business builder,” he said.
His father was a founding partner and later president of the renowned Wall Street investment bank Donaldson, Lufkin & Jenrette. Carl's grandfather was the chairman of American Tobacco and when he passed away, he left a bequest of $100,000 to his mother. When Carl inherited it 40 years later, it was still $100,000.
“He was shocked at how bad the service was and said, 'There has to be a better way,'” Michael said.
This inspired him to create his open architecture trust company.
“So we've added more value to families with our trust company and fully integrating it with investment teams than anything else we've done,” he said.