Pam Perskie is the Founder and CEO of Seven Mile Advisory, a multi-family office that works with clients who have significant financial complexity, including business owners, private equity professionals, real estate investors and operators, professional athletes, and entertainers.
Pam and I discussed how a successful multi-family office operates, the profile of clients, how her firm charges for its services, the mindset advisors need to work with wealthy (and oftentimes famous) individuals, where alternatives fit in her clients’ portfolios, and the role that technology plays in delivering exceptional service.
The multi-family office structure.
“I think of a multi-family office as a business that is focused on many families,” Pam says. “Multigenerational families with very comprehensive needs. I think the advantage of that is, first off, a family does not need to come out of pocket to pay for all the employees that they’re hiring just to service their family and all the technology and everything else. Also, the family benefits from working with folks who also work with similar families, because there’s a lot of learning that you can then bring based on your experience working with similar types of families.”
Pam says that individual need is more important than a specific level of net worth when it comes to identifying potential clients. Obviously an NBA player signing his first big contact will be facing some complicated financial issues. But folks with more modest wealth can still benefit from Pam’s expertise in those unexpected moments when life and money intersect, such as managing a significant inheritance. Some advisors shy away from working with $20 – $100 million families because they’re not comfortable dealing with that complexity. I asked Pam about the mindset needed to work with the ultra-high-net-worth and she said her team focuses on the common themes and challenges that apply to clients of all sizes. The fact is, we’re all human and some folks just have a few more commas on their balance sheet.
“It starts with investments,” Pam says. “The opportunity set is different. Minimums could be higher. Maybe a client with $500,000 really should not access privates depending on their situation, while a client with $50 million, that should be a key part of their portfolio. Retirement planning is not really as much of a focus for my clients. They’re really focused on transferring wealth to the next generation, charitable gifting, cash flow management, different aspects of planning, and then reporting because of the complexity. We do the strategic planning and advice internally; that’s like the core quarterbacking. We may be one of the only individuals in our clients’ lives that sees the complete picture. We do some operations and administration. But, if we don’t do it internally, we sort of look at it as our role to find the right people to help them with whatever they need.”
Seeing the whole picture.
Seven Mile groups its services in four buckets: Family and Legacy, Planning and Structuring, Wealth Oversight, and Risk Management. Pam and her team create customized service packages for each client, from just handling reporting or acting as a strategic advisor all the way up to holistic turnkey planning. Pam says that wealth planning is a typical catalyst for prospects to reach out, especially for families whose financial complexity is ramping up.
“I always tell prospective clients, you’ll sort of know when you need us,” she explains, “which is when your finances stop being something that you look at favorably. It’s something that’s creating complexity for you and becoming time consuming. It’s imprisoning you because you’re now stuck in your own spreadsheets. You’re not able to enjoy your time with the family. You’re not able to do your day job because your complexity has gotten out of hand. Now you really need support. So for a lot of families, the catalyst is, ‘We need help seeing the whole picture.'”
That high-level view is essential to Seven Mile’s Wealth Oversight services. For high-net-worth clients, Pam says every asset category is an option, including alternatives like private credit or private real estate. But it’s the conversations around things like risk tolerance, preferred liquidity, and generational wealth transfer that help Pam zero in on the right portfolio balance for each client.
“Of course, we favor different mixes over others,” she says. “Our philosophy is generally to keep the liquid portfolio in efficient asset classes that are a little more commoditized. Keep those very streamlined, very low cost, very tax efficient. The active budget goes toward categories that are less efficient in the markets, including private equity, private credit, private real estate, hedge funds even — those things are harder to access. There’s more differentiation between top-tier managers and median managers. So that’s where we want to spend the active budget. We talk through how this part of the portfolio is very expensive and oftentimes illiquid, but we’re marrying that with the core of the portfolio that’s low-cost, tax-efficient. We’re talking from a point of really just caring about our clients. ‘We just want the best allocation and plan for you, and this is how we would design it.'”
Pam says that as a client’s net worth goes up, their interest in alternative investments often rises as well, particularly in that $50-100- million-dollar range. Due to their personal or professional connections, many of these high earners have already made some investments in alternatives and private markets before they even sign up with Seven Mile. Those kinds of investors aren’t just going to want access to alternatives going forward, they’re going to expect it from any advisor they sit down with. Platforms like CAIS are making it easier for a wider variety of advisors to make those offerings and potentially work with more high-net-worth clients who will grow their businesses.
“I honestly can’t imagine what I would’ve done without CAIS, Pam says. “The level of work internally that would be required to access all these privates would create a lot of need for us to have our own staff internally do all the paperwork, track all the investments. They really do take a lot of that work out. Once you create the client’s profile, you hit a couple buttons and then you make new investments. The reporting, they’ve streamlined it. So as long as I understand the asset classes, I don’t need to understand everything about the managers. And that is a huge thing for us. CAIS is a game changer for independent advisors outside of the big banks and big multi-family offices.”
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