Shaun Hauser, the 49-year-old co-founder and chief executive officer of Wellington-Altus Financial Inc. in Winnipeg, took his boredom as an analyst sitting behind a desk to pivot to an entrepreneurial approach in the wealth management field.
He launched Wellington West Asset Management, a subsidiary business of Wellington-West Capital Inc., which sold for $333 million, then was on the senior leadership team at National Bank Financial. In 2017, Hauser co-founded Wellington-Altus, which is now past $30 billion in assets under administration.
He talked to Canadian Family Offices about his career path, the firm’s “secret sauce” to success and what he sees ahead for his firm and the wealth management industry in Canada.
What was your career trajectory leading to co-founding Wellington-Altus?
“I graduated from the University of Manitoba with a Bachelor of Commerce Honours degree in 1998. I was fortunate to get a starting job as an analyst for Loring Ward Investment Counsel, which later became Assante Wealth Management.
It was an amazing job but I found it incredibly boring sitting behind a desk for 10 hours a day. So I jumped to the sales side of the business and had a great time, learned a ton, and got to know the advisors, including what made them tick.
Co-founding a business in the early 2000s gave me my first taste of being an entrepreneur. After seven years, I ultimately ended up leaving that partnership, and, accompanied by a couple of portfolio managers, went to Wellington-West Capital in 2008. I was at Wellington-West for the next seven years in asset management, building up the firm’s fund complex.
We sold Wellington-West for $333 million to National Bank of Canada in 2011. I was then offered a job at National Bank Financial Wealth Management, a subsidiary, which I accepted and worked there for five years.
I’d started to get the entrepreneurial itch again and had an opportunity to partner with Charlie Spiring, Todd Degelman and Blaine Coates on our mission to make a difference in the wealth management industry.
We put a business plan together and in April, 2017, we launched Wellington-Altus Private Wealth. In just over seven years, Wellington-Altus has more than $30 billion in assets under administration, along with more than 110 advisor teams, and I think we have a heck of a business on our hands.”
What drove you to found a firm in the wealth management industry?
“My father was an entrepreneur. I’m a serial entrepreneur. It’s always been in me. I like climbing mountains and metaphorically speaking, believe I am definitely on one here running Wellington-Altus.”
What is unique about Wellington-Altus? For example, are there certain factors you could point to as being the ‘secret’ to the firm’s success?
“The reasons are culture driven. It is our perspective that advisors are looking to be surrounded by people that care about them like they care about their clients.
We’ve spent an exorbitant amount of time, money and effort towards building a lot of really cool digital forward platforms and tools for advisors. We’ve become known for that. But what I like to tell advisors is that, while you may join us to gain access to some of this cool stuff, you will remember us by how well we treated you and cared about you, and how we tried to fix any problems you had quickly.
I think that’s the secret sauce for how we’ve gotten to where we are today.”
Wellington-Altus recently attracted equity capital from American asset manager Cynosure Group. Is the firm open to attracting other equity or other types of investments?
“It is our intention to keep Wellington-Altus Private Wealth a Canadian-controlled private corporation. There are lots of benefits to that.
If we’re lucky enough to find another Cynosure, awesome. But we don’t necessarily need to. We’re in a really good spot corporately and financially right now and I think we’ve earned the right to be a little picky. We just want to do right by our advisors.”
Wellington-Altus has a presence in the U.S. Are you looking to expand further outside Canada?
“No, we aren’t. The U.S. presence has been a little bit more successful than we anticipated.”
Where do you believe the wealth management industry in Canada is headed, in general?
“I think if you look south side first, the United States has had a lot of consolidation, and that makes a lot of sense, given the size of their market. The consolidation that occurs here in Canada isn’t as prevalent because of our relative lack of size.
The more affluent people become, the more advice they need, and the more trust they require. With the inter-generational wealth transfer upon us now in Canada, that means people need advice, and so I think the industry in general is going to continue to expand and grow.
The companies that will capitalize the best are the ones that invest back into their business to give advisors the tools they need to take care of clients’ complex situations as they accumulate more wealth. That is how we believe companies will be successful.”
Do you see any patterns in terms of what end clients are looking for from wealth managers, particularly with respect to ultra-high-net-worth clients?
“I see a couple of things. First, as Canadian families grow more affluent, they’re more likely to own different esoteric asset classes, and so how you report all of their wealth in all of the different mediums is really important.
They also provide clients with the right asset classes and mix to lower their daily portfolio volatility rate. That’s not easy to do, but we’ve worked really hard at that at Wellington-Altus.”
Are there any regional differences across Canada in terms of wants and needs and priorities?
“Not a lot. The way tax regimes work in Canada, it’s all pretty consistent, and that is reflected in the client experience, no matter where they live. The marginal tax rates are a little different in each province, so that just takes some extra financial planning and income planning.
Wellington-Altus tries to provide a consistent experience across Canada, and as such we create centralized tools that advisors in any part of the country can access.”
With the intergenerational wealth transfer currently under way, have you noticed differences in the different generations’ priorities?
“I think younger people validate your worth as an advisor in different forms. For example, as the younger generations start to inherit this wealth they validate Wellington-Altus’ worth and expertise through electronic means. And so we have set up our advisors to be ready for that forum, whether it be via their website, social media, or other means.
Do you see any growing trends that will impact the future, such as end clients’ interest in alternative investments, or cross-border issues?
“Absolutely. When it comes to alternative investments, we’ve spent a lot of time working with U.S. private equity sponsors and U.S. investment bankers, and I would argue that Canada is at, or even a little ahead of, where the U.S. is around sophistication on alternative investments. It’s quite prevalent here.
If you are an affluent person and you have cross-border business you are going to have cross-border asset issues. An affluent family can very easily have a U.S. resident, with investible U.S. assets and also Canadian resident investible assets, and how you bring those together and manage them is complex for a household.”
Do you have any thoughts around the current macroeconomic conditions, such as inflation and interest rates, and how that may affect the wealth industry?
“Historically high interest rates usually result in lower markets. This is an interesting time in that we’ve had elevated rates for a while that have taken time to curb.
If rates go down, which in my opinion is the likelihood compared to their rising or remaining static, you would probably have a spike or increased level of capital market performance – which in our business is fantastic.
Over 90 per cent of our assets have some form of recurring revenue attached to them, which means that if rates go down, and markets go up, then invariably our revenues will go up.
I think the Fed is taking its time in the United States, and the Bank of Canada is doing the same here, to make sure that inflation is absolutely curbed, but they also don’t want to squash it just yet such that it could create a recession on either side of the border. These are always precarious decisions that need to be made.
Responses have been lightly edited for clarity and length.
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