Preparing for his interview with Wealth Manager, Rupert Forrest has done some research on Yorkshire, the region where he has lived for a decade, and where in 2015 he launched his business, Raymond James Leeds.
It’s tempting to credit this to a military adherence to the six Ps, drilled into him in his earlier career as an infantry officer, but it as likely more to do with an innate amiability and desire to help out – the characteristics, he says, which motivated him to leave the security of his former blue-chip bank employment.
Either way, the exercise has prompted some thoughts on the changing nature of the region’s prosperity and how this has changed the topography of local industry.
‘The economy of Yorkshire is worth £110 billion, or two times Wales, which does make you stop and think. Without wanting to get sucked into the marketing about a northern powerhouse, that is pretty big,’ he says.
‘At the time I joined Rensburg Sheppards [in 2007] it was just consolidating in Leeds the branches it had in Huddersfield and Bradford, which historically speaking, used to be where you found the biggest concentrations of wealth from the wool trade, before they were overtaken by industry.
‘My wife’s family has been in Yorkshire for seven generations so talking to them you do really get the sense of the change over that time. But even in the years since I have been here, the changes have been pretty remarkable, as [Leeds] has become important to the finance business.’
Just short of three years into his career as independent business franchisee within the Raymond James group, Forrest is steadily building his own offshoot off that boom, having gathered around £45 million on around 70 client accounts.
He is acutely aware that places him just in the foothills of the local wealth majors but equally clear that he is investing in something long term.
‘Funnily enough, for some who works in investment I am not amazingly business minded and certainly not one to spend a huge amount of time with my nose in a spreadsheet.
'I have always sort of taken the view that if you get the pitch right and you treat people with respect, they will come with you and everything else will sort of flows from that. I definitely wasn’t buying and selling Mars bars at 16-years-old – I’m no Richard Branson.
‘When you have a wife and a child and a mortgage it does definitely sharpen your mind when you turn up on the first day and there is zero revenue.’
After leaving the army following a seven year stretch in 2007 – which included a deployment north of Basra - his career in finance very nearly failed shortly after launch in early 2009, at the nadir of the credit crunch.
‘I am good at the investment and good on the people skills but not so great on the corporate stuff. I was sitting there in the office and one by one everyone around me was being tapped on the shoulder and being pulled off into an office.
‘It turned out that they were letting all their trainees and juniors go. That was when I realised that this was a very different environment – you have strategic downsizing in the Army, but that was the first time I ever really thought that this is a corporate body which is ultimately answerable to shareholders.’
Looking back he says he believes that already being on his second career, and able to claim a set of – literally battle-tested skills - was likely the fact that saved him from the chop.
Despite a possibly inauspicious start, he says he thrived through almost four years of Rensburg, and later the company’s reincarnation as Investec, and then a further four years at Barclays, serving the wider Yorkshire region.
He is a lot more prudent than some others about his time at the latter and says while it is not hard to see the substance of much of the criticism levelled at the business, it also offered a lot of value.
‘There is a lot that Barclays Wealth does very well – it’s a big organisation, and that means it can provide a lot of options [to clients] in terms of products and services. And there is also the presentational stuff which it does extremely well – they are exceptionally good at framing a message and getting that across.
‘I suppose that this might sound arrogant, but after a while you do start to wonder if you can do things better, though. Not all the tax planning and big-bank product stuff obviously, but the long-term relationship things, investing in a lasting personal service.
‘And also I had the idea that the time was right. I was in my mid-30s, and I have the energy and determination to get something off the ground. Other people might wait until they are in their 50s but I felt like this was the moment for me.
'And this industry is a small world - its small in London but it’s even smaller once you get out into the regions. Clients had let me know they liked what I did and would be happy to support me [as a sole trader].’
Following a fretful nine months serving out his non-compete and the resolve-stiffening process of opening up with overheads and zero revenue on day one, he says signing the bulk of his business has been lumpy, with four or five accounts delivering the bulk of assets.
Those have, to some extent enabled him to cross-subsidise a long tail of ISA accounts which may or may not be currently cost effective, but are likely to grow substantially in the years ahead.
Crucial to the success of the business has been the support of a well-regarded local financial adviser, he says. Longer term the development of the service is likely to need a full-time planner in-house but this is as contingent on the challenges of recruitment as it is upon finding the income to pay for another person, he adds.
‘If you look at a business like Killik & Co, and how that has developed without just blindly following an expected business model, that is very much something that I aspire to. The benefit I can supply to a client is my background in discretionary investment management, but that needs to be matched with a [planning] framework to ensure the right overall outcomes.
‘We have some very significant accounts, but obviously those may be only a portion of someone’s overall portfolio, or one specific part of their portfolio. A lot of those will be growing every year. And if we are running someone ISA then yes, realistically I am probably going to be losing money in the short term, but that is a long term investment in a future relationship.’
At the heart of the service the business obviously succeeds or fails by the value of its investment decisions, however. In addition to the wider operational support provided by Raymond James’ corporate division Forrest has thrown in his lot with regional peers Nick Hair of Raymond James Harrogate and Robert Allman of Raymond James Wilmslow, to create an informal investment panel.
The biggest value-adding decision of the near three-year history on the funds has been the trio’s collective thematic conviction in tech and healthcare, he says, which forms a discreet commitment in client funds on top of the WMA-benchmarked asset and geographical allocations.
‘That makes up around 10% of a balanced managed portfolio; not nuts, but enough to make a meaningful contribution,’ he says. ‘That is not weighted geographically but obviously just because of the nature of those industries and where they are based, it does add to our overall dollar, US equity exposure, which seems worth it to capture such powerful long-term drivers of performance.
‘The generation of baby boomers now entering retirement are wealthy, and they are going to be spending that wealth on healthcare and leisure.’