News

Local Women Take Common Path to Unusual Partnership

September 2015

Walden Wealth Partners LLC, owned and operated by two Cleveland women, is bucking a national trend in the male-dominated asset management industry.

Northeast Ohio natives Sarah O'Neil Hannibal and Karin Maloney Stifler both worked for large companies through their respective careers. Both grew up in Cleveland suburbs, studied at Miami University, moved away for work and returned to the region for new opportunities. Serendipitously, their paths first crossed at an educational seminar just a few years ago. They marveled at what they had common " both are also married and are parents to three boys " and saw an opportunity to realize their own dreams of starting their own wealth management business together.

Hannibal most recently operated an independent Cleveland office for Chicago-based GEM Asset Management, while Stifler ran a similar operation through True Wealth Advisors in Hudson. Those local operations dissolved as Stifler and Hannibal combined their clients into the 100-person client base they opened Walden in Solon, OH where they currently log $80 million in assets under management. They transitioned into their new business in June. The name is a nod to Henry David Thoreau, who wrote that “wealth is ability to fully experience life.”

After working at large companies, each moved to midsize firms in search of how they could make a greater impact and, they say, help individuals experience that quality of life the transcendentalist author references. They saw that opportunity in working directly with individuals instead of one person in a multi-person team working with a massive company.

“Big companies also direct things from the top down,” said Hannibal, whose past employers include Deloitte and J.P. Morgan. “There wasn't much flexibility to do what you thought was the right thing to do.” In Walden's business model, that “right” thing, the founding duo says, includes offering a fee structure they feel will appeal to new clients " particularly considering the growing awareness by the public of costs in asset management, which is helping drive an overall fee compression in the industry, and competition from new, robo-adviser services.

The industry overcharges the highest worth individuals and “under-serves” those in the lower end of the spectrum, Hannibal said. Walden's model aims to combat that. Walden charges 0.8% of assets under management, a shade lower than the national standard of about 1%. They charge a minimum fee of $2,000 a quarter and have no tiered system for clients of varying wealth. Interestingly, they also offer a cap on charges, which would seemingly benefit ultra-high net worth individuals. Industrywide, that's rather uncommon. “That bubbled up out of that sense of what's fair,” Stifler said. “The fees in our industry can be excessive at times, and we didn't feel comfortable being a part of that.”

Both declined to share projections for end-of-year incomes and said they haven't pegged any specific growth goals, asserting they're confident organic growth will come through word of mouth. They do no advertising or marketing beyond their company website. “We're not trying to build an empire here,” Stifler said. “We're just trying to serve each client one at a time at our highest possible capacity.”

Story by Jeremy Nobile in Crain's Cleveland.