SAFE PASSAGE
Although the markets looked a little better at the start of this year, we just don’t know what’s on the horizon. Are we in for a decade of near zero interest rates, low growth, and minimal or no inflation? What does all this mean for investment opportunities? Will sustainable funds soar? Is cryptocurrency the way to go? What about bonds, property, oil and gold? Are equities still reliable as a solid foundation for portfolios? Many experts believe the stock trading landscape has changed for good. Investment strategies now have to consider the clear winners and losers from the coronavirus and take into account the opportunities and pitfalls amidst all this economic upheaval. With a presence in the USA, Europe, and the Middle East in the pipeline, Cardea Capital Advisors LLC is a firm with global roots, an expansive business network, and an institutional approach to investing that allows its investors to focus on protecting their clients’ legacies –always prioritising each individuals’ personal circumstances, objectives, needs and risk tolerance.
Our business is primarily one that serves institutional clients as well as wealth advisors. So, our business has three verticals. One is a turnkey asset management platform, which is essentially a back o ce, a middle o ce and front o ce for wealth advisors. It’s a complete turnkey solution, which means that, a wealth advisor can focus strictly on managing client relationships. And we take care of everything from building the investment portfolios, asset allocation, client onboarding, operations, compliance, everything –in return for a fee arrangement. That’s one part of our business, the other part of the business is wealth management and institutional consulting and advisory. That’s pretty robust. And then the third part of our business is via an acquisition that we’re in the process of making, which is a fund platform and a managed portfolio service.
All of these questions impact the world of investment. The markets are on a rollercoaster ride of dips and upswings and everyone is strapped in, white knuckled, trying to anticipate what’s around the corner. The financial sector has been scarred by the turmoil wrought by Covid-19. The FTSE 100 fell 14 per cent in 2020. Many companies ceased paying out dividends to shareholders to try and mitigate the seismic impact of the crisis. Dividends dropped 44 per cent to £61.9 billion in 2020 –the lowest annual total in a decade.
Subsequently, Waring founded several successful fixed income proprietary trading operations as a consultant, including for Aalto Invest in the UK and BH Securities a.s. in the Czech Republic. He’s the right man to be guiding Cardea’s clients through the choppy waters that are inevitably ahead. When we meet at his o ces it is soon obvious why Waring has a knack for inspiring people and putting together solid teams to seek out opportunities and then thrive. He is open and approachable, friendly and charismatic… and no doubt key to his successes, he displays a powerful enthusiasm when it comes to building businesses and driving them to the top. Unique has many questions… Cardea Capital is a multi-layered business, could you please summarise your main services?
When will the lockdowns end and will our lives be permanently restricted?
When can we travel again? And how?
All of our lives have been disrupted like never before. Some of the changes that have swept over the planet may prove to be irrevocable. That term which crops up time and time again –the “new normal” –we still don’t know what it’s going to look like. When are schools going to function like they used to? Are o ces going to fully re-open or is home-working here to stay?
From his base in Barcelona, Spain, Jordan Waring is the man steering the good ship Cardea. Waring is the Cofounder and Managing Partner and he has successfully founded, developed, managed, and invested in successful businesses in financial services since 1986. He brings to the table more than 30 years of experience in fixed income, equities, private debt, commercial real estate financing, and alternative financial solutions. Waring is highly regarded by his peers for his boundless energy and super positive attitude, and he’s respected for being a hands-on leader, forging a way ahead by example. He has served in senior management roles, including CEO and Managing Partner, for over two decades. As CEO of Auriga USA, the US subsidiary and licensed broker/dealer for Auriga Securities, a Spanish Investment Bank, he grew the team from three people to more than 75 and successfully steered the firm to high profitability in the midst of the 20082009 financial crisis.
What do your customers perceive as the key benefits with Cardea?
All of those businesses, when COVID initially hit the markets hard last March, were impacted for a period of time. But then the market has since reached highs. I think it’s up 16 per cent year over year. Since COVID really broke out we have also very strongly recovered. And our strategy is acquiring firms. So, as we look for acquisition opportunities –some businesses that weren’t quite so well positioned for the crisis –it gives us an opportunity to get in there and make further wealth management from acquisition. So, we’re in really good shape. We grew over the period of time during COVID from about 300 million dollars of assets under management to 3 billion. On a human scale, the su ering has been tremendously awful, but from a business standpoint for us, we’ve had a very good year.
How has the COVID-19 crisis a ected your business?
We’re in the TAMP (Turnkey Asset Management Program) sector and there’s a lot of competition. In the US for example, roughly 45 per cent of financial advisors use a TAMP solution. So it’s a huge amount. And I think they’re saying that by 2025, I was reading some industry report, which said there was going to be 13 trillion dollars of assets sitting on TAMP platforms. 13 trillion. Yeah. So, our little team, our teeny amount is nothing in the overall scheme. When I bought the firm (Lindner Capital Advisors) in 2019, I was very conscious of not wanting to try and be another supermarket, because if you’re a tiny little supermarket in the town next to
“OUR BUSINESS IS PRIMARILY ONE THAT SERVES INSTITUTIONAL CLIENTS AS WELL AS WEALTH ADVISORS”
We’re definitely not imitating anybody. We have a unique o ering in the market because we’re the only smaller firm
I feel that, number one, try to be an innovator, but number two, I surround myself with people that are like-minded. I think that we all kind of keep each other sharp and we’re always looking and turning ideas around a hundred per cent. Just what we’ve accomplished in the last couple of years, really, it acknowledges that. And you’re not imitating or taking the lead from elsewhere?
Let me take the last part first because that’s the part that gets me really excited. Our idea is, because we have this great solution for financial advisors and wealth advisors, and we really do it very, very well, and copy-pasting it into the UK and into Europe. And so, we have recently engaged and partnered with somebody
That’s a good question… stagnation, I think e ectively this organisation will never be stagnant, provided I’m at the helm because I’m always running at about 10 million miles an hour. I’m always just very high energy and it’s just my natural personality. As some of my people say, I sail right on the edge of the winds, you know? And I do, and we’re constantly in growth mode. And we’re constantly constrained because I could go three times faster than we can go because of capital, right. So, stagnation, I’m not too worried about that because
The risk weighting is going to be the same but what makes up our portfolios is a lot more o the beaten path then a bigger firm would have. So instead of having funds like Fidelity and Goldman Sachs and big names, we find managers that are a little bit more outside the mainstream, doing things a little bit di erently, but the risk parameters are still the same. So the client’s not taking more risk, but they’re getting exposed to things that they wouldn’t necessarily find in a bigger shop. It’s di erent. What measures does Cardea take to avoid stagnation or imitation?
that has a footprint both in Europe and the US, and soon to be in the UAE. That was one of the reasons we were able to attract some of the talent we’ve attracted, where they said, you know, ‘we like the flexibility of being in a smaller firm where our ideas have an impact, and we can pursue some of them and create our own models, but yet we have the global footprint’ –and that’s really a di erentiator for our clients. Because our clients are in Europe, our clients in the UK, and previously, if we wanted to have flexibility, we had to work in a small firm, which didn’t have any European presence. Or we could work in a large firm, which had the European presence, but had lots of constraints. So, we’re in an interesting sweet spot. Where is Cardea most successful –and can you elaborate on how you perform internationally and what is the outlook for global expansion?
in Dubai who has been there for a long time and knows the whole o shore IFA market very well. And so, who are these IFAs? These are guys who are servicing ex-pat clients living abroad who have money and want to invest and have their wealth managed. And we look at that as a conduit to our US and UK business, like a feeder into those businesses. So, if we have an IFA that’s based in Beijing, we can have him sit on our platform and use our investment models, use our services, et cetera. So, I’m very excited about international expansion. We will make this foray into the Middle East and then from there look at doing something in Asia or Australia. My goal is to get us to 10 billion in assets within the next three years. Do I think I can do it? A hundred per cent. I’ve gone from zero to 3 billion in two years, so think I can do that. And when we get to that level, we suddenly become infinitely more attractive in terms of sale multiples if we want to exit the business. Your approach seems to be of the ‘climb any mountain’ kind. When I started we had an o ce in Barcelona. It was me and one employee
“THIS ORGANISATION WILL NEVER BE STAGNANT, PROVIDED I’M AT THE HELM BECAUSE I’M ALWAYS RUNNING AT ABOUT 10 MILLION MILES AN HOUR”
70 per cent equity exposure, 30 per cent fixed income. What would compose those portfolios?
So, I said, ‘we need to focus on a more bespoke o ering, something that is really di erentiated.’ And so what we do is, our investment models follow the same sort of risk parameters that a bigger firm would have, but what composes those portfolios is di erent. In other words, you could have a client that would do a risk analysis and it would come out like 70/30 right?
Carrefour and Tesco, you’re going to be out of business quickly.
“WE NEED TO FOCUS ON A MORE BESPOKE OFFERING, SOMETHING THAT IS REALLY DIFFERENTIATED”
What I feel really proud about is that our level of client service is extremely high, so that when an advisor calls, it’s not a situation where it’s like, ‘press one for funds, press two for backups’, you know, we actually have people that answer the phone, get back to them within 30 minutes, and it’s always personal. Having that level of very high excellence is something that’s part of our corporate DNA. And so my goal is that, as we grow and expand and we’ll need more personnel to keep up with it, we’ll just hire people that will do that. I don’t care how big we get, how many assets, how much we have under management. I want that level of service so that people get responded to personally, because
And the processes are all there. Then we optimise. By cutting costs where necessary, making it more e cient technologically speaking or however, and also optimise revenues. How do we do that?
www.cardeacap.com
What do you recognise as one of the key drivers for your rapid growth?
This is why people use it… because it’s a great solution. And then they can just focus on going out and raising new assets, focusing on the client relationship.
What we give them is a complete turnkey platform for them to just say, ‘you know what, here’s my client, here’s their information. You feed the portfolio.’ And we do it all… we construct the portfolio for them, we do any trading, any allocation that needs to change, we do the reporting, we do the billing –and we just send it to them. In e ect, doing their job for them?
One of the things that we’re really keen on doing is to bring a whole lot of really interesting technology into the whole process. We have a strategy that I call AIO. It’s acquire, integrate, optimise. When we make an acquisition, we look to then integrate it. We make sure the systems are matching and the investment processes are matching. Let’s say we buy a wealth manager in North Carolina, for example. I say, okay, I want this to be a Cardea company now. So we have to make sure that we do everything that turns it into a Cardea company. We make sure that the software we’re all on is the same, the investment models, et cetera, et cetera.
Our TAMP business at the moment is way smaller than our wealth management institutional, in terms of just pure assets under management. But I feel that the TAMP business is hugely scalable. So, if we do it correctly, that could dwarf all other parts of our business. How does it work for one of your customers?
and that whiteboard over there. And we’re now where we are. Had you told me then that we’d be here now. I would never have believed it. And so, you know, think like, hey, why not try and see what I can do. What parts of the business are you excited about?
By essentially integrating our investment models. We also have a marketing consortium and so we drive more business to the firm and look to do it that way. So for me, it’s a combination of, if you reduce costs by 10 per cent and you increase revenue by 10 per cent, you get an exponential gain, right? And so this is the whole sort of idea behind this AIO –to really make sure that when we acquire, we really integrate and optimise. Part of that is creating technological solutions which empower advisors and empower investors to create their own investment models or experiment with their own portfolio to see what works best for them. Where do you see Cardea Capital in five years’ time?
I read the meaning behind it and Cardea was the goddess of door hinges and handles in Roman mythology. But... far more than that, she was the protector of children in the family. Also, her name came from the axis upon which the earth spins. So, we thought, ‘Oh, what a great concept –that we’re helping our clients to preserve generational wealth for their kids. And what a perfect way to segue into what we do. I thought ‘Bingo, Cardea’ –that’s it!
Well, to obviously have significantly more money under management, but also to have an undergirding of technology and systems and processes that are really cutting edge. World-class. It’s something that we work on all the time and we have a guy based in Switzerland who used to be very senior in investment banking and technology, and he’s constantly focused on this issue. Finally, can you tell us about the company name?
what I hear time and time and time again from reps about why they work with us, is ‘yeah, the other stu is great but what we really love is that we get a call back, we get an answer right away’. Are there any new developments and applications in your sector that you think may soon disrupt or gain serious traction? You must be constantly monitoring technological developments?
“WHAT I FEEL REALLY PROUD ABOUT IS THAT OUR LEVEL OF CLIENT SERVICE IS EXTREMELY HIGH, SO THAT WHEN AN ADVISOR CALLS, IT’S NOT A SITUATION WHERE IT’S LIKE, ‘PRESS ONE FOR FUNDS, PRESS TWO FOR BACKUPS’. WE ACTUALLY HAVE PEOPLE THAT ANSWER THE PHONE, GET BACK TO THEM WITHIN 30 MINUTES, AND IT’S ALWAYS PERSONAL”
