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Pittsford financial adviser Lori Van Dusen-ranked among the top advisers in the country- has left her former employer to launch her own institutional and individual investment firm this week.
Van Dusen and the Pittsford office of Convergent Wealth Advisors LLC parted ways Friday after three years. The office on Monroe Avenue opened Monday as LVW Advisors LLC.
Van Dusen was executive director in the Rochester market for Convergent, whose headquarters are in the Maryland suburbs of Washington, D.C.
"It's the same people, the same process, the same business philosophy," Van Dusen said this week. "But it's our own firm.
"We're able to take everything we built at Smith Barney and then at Convergent and take the next step of the evolution to where I think the business and the industry are headed for people who deal with the higher end of the advisory business."
Van Dusen took Convergent's team of 11 in Pittsford with her. Richard Van Kuren, an associate for 15 years, and Jeffrey Wagner, an associate for 11 years, are partners with Van Dusen.
Christine Porter, an associate for 14 years, heads operations at the new firm. Thomas Hawks III is the other senior executive.
"Lori Van Dusen's departure agreement with Convergent was altogether amicable and in the best interest of everyone involved," company spokeswoman Laura Smith said. "Convergent is working to ensure that client service continues uninterrupted.
"Convergent's business remains strong. We are adding new clients at a faster pace than ever before, and these changes will allow us to better focus some of our resources on future growth opportunities."
LVW, a fiduciary firm, is a member of Focus Financial Partners LLC, the country's leading partnership of independent wealth management firms, Van Dusen said.
"This was a lot of due diligence and a lot of work to select Focus as my minority partner," she said. "It's not like somebody just says here are all the answers and here's how you build this.
"Because I made that intermediate step to Convergent, I knew a lot more than I did three years ago about how to build this."
LVW partners average 18 years of experience in the investment business, she said. The staff average is 10.
Van Dusen declined to disclose the firm's assets under management, but said everything from the Convergent portfolio is now at LVW.
Barron's magazine lists Van Dusen with assets of $5 billion, with typical accounts of $60 million from clients with a typical net worth of $60 million. Van Dusen ranks third nationally on Barron's top 100 female advisers for 2011 and 83rd on its list of male and female advisers.
Van Dusen joined Convergent in August 2008; its Pittsford office opened Sept. 5. Before that, she was managing director of investments for Citi Smith Barney, a division of Citigroup Global Markets Inc., and founder of Citigroup Institutional Consulting.
She was with Citigroup Inc. for 22 years.
"After over two decades in the industry, this business model has been in my head," Van Dusen said. "It's the culmination of a life's work in the business.
"I built a firm that dealt with the whole client. We would holistically integrate tax, estate and financial family philanthropy issues. For our organizations, we always married the specific organizational issues with the investment issues."
That philosophy was not always easy to achieve while working at a large wire house such as Citigroup, whose branches generally are linked so information can be shared, Van Dusen said.
"There are a lot of product silos and barriers you have to jump over," she said. "Big organizations are built for a platform of thousands of advisers and not customized to our type of business."
Also, regulatory and compliance reforms following the 2008 financial crisis created a need for independence, Van Dusen said.
"That was the Convergent step, where we went from a wire house to an independent model," she said.
The move to Convergent gave Van Dusen freedom while allowing her to build an investment platform of research and technology, she said.
"We helped build Convergent's investment research process out," she said. "We're not only continuing to tap into that, but we also have five other research vendor relationships. We have doubled the due diligence on investment managers and products, and we have probably quadrupled our research universe."
In addition to the 11 full-time employees, Van Dusen plans to hire three more, including a chief operating officer and a chief technology officer, to replace temporary workers at those positions.
"We continued to grow the business over the last three years and we're taking on the same kind of client we've always had, which is the higher end of high net worth and the institutional clients," she said. "They need a powerful combination of research and resources. That's what we built."
The departure from Convergent was amicable, Van Dusen said.
"We were under the Convergent house for the last three months building our firm," she said. "We will continue to use their research resources, augmenting them with other providers, and they will continue to refer us business on the institutional side.
"Because it was a negotiated exit, we were able to stay at Convergent until Friday and basically flip the switch on our technology and our business over the weekend and start up as LVW Advisors on Monday."
Van Dusen declined to provide financial details of the transaction.
"I essentially bought myself back from Convergent and then sold a minority interest in the operating company to Focus Financial Partners," she said. "We have a management company and an operating company."
Focus Financial Partners does business with top advisory firms nationwide, Van Dusen said. It has expertise in operations, compliance issues, building platforms and negotiating with vendors.
"They really gave me and the team the ability not to be distracted, to build out this business over the last three months while we continued to work with our clients," she said.
Launched in 2006 by founder and CEO Ruediger Adolf, Focus has offices in New York City and San Francisco. It has 23 U.S. partners, including LVW, and one in England.
"Lori Van Dusen and the team at LVW are truly among the very top institutional and high net worth advisers in the country, and we are very pleased to have this noteworthy firm as one of our partners," Adolf said in a statement.
Representatives of Focus and LVW worked together to develop the firm's infrastructure.
"We control the business," Van Dusen said. "They have a minority interest in the operating company. They don't have an interest at all in the management company. Equity will be distributed among the partners here."
Clients can access personal data using a secure ID via the Web, Van Dusen said. The information can include financial data, tax returns, estate plans, trust documents and house deeds.
The assets of Van Dusen's family clients range from $10 million to $500 million. Institutional clients range from $25 million to $1 billion. The individual and institutional clients are evenly divided.
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