Read this interview by David Zax, a freelance financial reporter whose work has appeared in Bloomberg CityLab, Entrepreneur Magazine, Fast Company and The New York Times.
Published Feb. 15, 2023
Tom Ruggie’s 31-year career spans managing wealth both for standard investors and ultra-high-net-worth clients. Since founding Florida-based Destiny Family Office in 2015, his focus has been increasingly on the latter. He spoke with Crain Currency about the excitement of having entrepreneurial clients and how working with ultra-high-net-worth individuals grants access to the “upper stratosphere” of the investment world.
Why do you especially like working with the 13 clients of your multifamily office?
They’re entrepreneurial. Most are either currently entrepreneurial, or the wealth came from entrepreneurship. Candidly, I’m probably not a good fit for G5-type wealth [i.e. inherited fifth-generation wealth]. What resonates with me is working with people that are like me. I started with nothing and have built a very nice business through hard work, from scratch.
What are the ways that entrepreneurial energy manifests in the client relationship?
They tend to be appreciative of what we do for them. They tend to listen very well to recommendations. And they tend to be quick decision-makers. They know what it takes to reach a level of success because they’ve done it themselves. They know it requires hard work, being studious, being up more hours of the night. I’m still wound that way. I’m like my top client. In theory, I don’t have to work anymore, but I love what I do so much.
When you moved from more typical wealth management to the family-office space, how did things change for you?
I was amazed. I was shocked to see what is available and how an investment banking company might treat me as the CEO of a family office versus the CEO of a wealth management firm. That was by far the biggest “aha.” We got into a lot more PE-type offerings, and that has actually progressed to doing direct investments. I’ve been shocked at how strong and consistent the performance is with some of these companies. The landscape changes when the firms looking for your business are aware that you have UHNW clients. It’s a different conversation, and you get hooked up pretty quickly with the upper end of the investment stratosphere.
I cringe when I say this, but something I kept saying to myself when I saw all this was “I understand why the rich get richer.” Because they get offered opportunities that are just not available to somebody that’s not rich. As someone who grew up lower-middle class, it goes against my grain. But at the same time, if the opportunity is there, you should take advantage of that sort of thing.
What’s a direct or co-investment you’ve been able to make that you’re excited about?
Within our co-investment portfolio, the first company was Hipgnosis, which was brought to us by Blackstone. It’s a neat concept, a company based in the U.K. that holds rights to various music. They just purchased Justin Timberlake’s book of music rights. If Blackstone is becoming majority owners, history says they have a pretty good reason. Everybody makes mistakes, but Blackstone doesn’t make too many of them.
What’s something you know now that you wish you’d known 10 or 15 years ago?
The Great Recession was a great learning stage for me. I had sleepless nights in 2008, worrying whether I was doing the best thing for my clients. Fast-forward to now, and I just have a sense of confidence that regardless of what’s going on out there, we are doing what’s best for our clients’ long-term interests. I don’t have those sleepless nights anymore. That attitude also conveys to the client. Clients know if you’re scared.