Passing on a successful firm from founder to young son can be a fraught experience. Long-time unit holders and employees might wonder whether the new kid can handle the pressure.
But when it came to passing the torch at the W.A Robinson group of companies, the company was careful to take the same measured, planned, conservative approach that has proven so successful in the management of the company's business. Turns out, prudent, deliberate planning is key to succession. The firm provides a sterling example of how this kind of transfer can work.
The W.A. Robinson group of companies has been successful providing mortgages, investment vehicles and advice to a loyal group of clients and unit holders from the shores of Ontario's Sharbot Lake. The company provides mortgages that the big banks are less likely to deal with. The company has long run a fund that packages those mortgages into an investment fund that has provided decades of steady, stable returns. Maintaining this careful balance was the goal of a succession plan that also goes back decades.
Matthew Robinson first started working for the family firm while still in his teens. He started in marketing. “I came in at 16. Instead of cutting lawns, I put up real estate signs,” says Robinson in an interview with WP. He subsequently moved on to other positions. Over the years he’s been privy to the conversation about the company, often around the dinner table. Eventually Matthew did a commerce degree. He obtained his real estate broker licence in January 2000 and sold real estate before earning his mortgage broker designation in October 2004. As an independent mortgage broker he has learned some lessons along the way. “I had my ass handed to me early on,” he says, explaining how he learned that key lesson so important to anyone working in the wealth management industry—no one is smarter than the market.
Eventually Matthew came back to the family firm. A conversation was taking place about how the company would be led into the future. “There were no health issues. But people started to ask, ‘what's next?’” he says. Five years ago a formal plan began to come together. An outside company was hired to help work out a plan. Eventually Matthew was asked to come into the business on the portfolio side of the company to develop the skills necessary to manage the Frontenac fund, a mortgage-based investment vehicle that the company has run for decades.
The top job was not promised to Matthew. It would only be his if he was able to prove he could prove he had the skills. “I had to have real experience. If we didn't get this right, there would be no succession,” he says. “We like each other as family. But if there is someone that wasn’t in to it, it wouldn't work.” That is, there was no way anyone involved was going to risk damaging the reputation of the firm. “Our fund has a record of going on thirty years without losing money. That’s a good track record. My father has generated a lot of trust over the years,” says Matthew.
Since then the son has been absorbing the lessons, listening to the counsel of the founder and the long-time employees. In recent years Matthew has been taking on more of the daily duties at the firm. Over the past year he has been defining strategy, building a strong management team and managing the day-to-day operations. “You have to have a good plan, and love it. When your last name is on the wall…you have to take it seriously. We've had people here for thirty years. You just can't blow this thing up,” he says.
Going back to the values that have defined the firm, he recognized that the company’s advantage has always been the close and direct communication with clients. The personal touch sets them apart from bigger institutions. “You really have to like the client. Our mandate is capital preservation with a reasonable return. We could sell out to a big institution. But that’s never been in the plan. This is a family business, there's something more here than the mighty dollar. It's typical of my generation that there are people's needs that we take for granted. But you have to have a conservative mandate. You have to understand we're just one part of it," says Matthew.
Absorbing the philosophy has been important to taking on the top spot. It is clear Matthew has absorbed the thinking of the founder. The company recently held its AGM. The firm flew out its portfolio managers. One-quarter of the company’s investors showed up. Almost 400 people gathered in a local church. “I know everybody there. It's a party. You need to know your client. You have to know a bit more than asset allocation. You have to know the kids names,” he says. The challenge will be reaching out to the younger generation in the years ahead. “You’ve got to reach out to the 40-year olds. You have to develop that trust. Sometimes, at the big institutions, success is all about next dollar. But our claim to fame is that we're still at that level where you can get me on the phone. We call our clients, they don't call us. You can't buy that. I don't think big institutions have that...If you take care, if you’re careful, you'll have clients for a long, long time.”
That is, existing clients can be assured the firm is going to carry on much as it has for the past couple decades. “A lot of things have been carried forward through this succession. I've done this all my life. It’s been a lifelong learning curve. The plan started the day I was born," says Matthew. Experienced hands at the firm will continue to work with him. His parents still live across the parking lot from the main office, so the founder will always be available as senior counsel. The company will continue along much the same as it did before. “We're lucky. We could do growth for growth's sake. But we haven’t. We’re not leveraged. We've got great capital in our portfolio management company. We’ve got a great network of mortgage brokers across Canada. We hear that we are needed. We are doing well,” says Robinson.
That is, the company’s philosophy lives on. The torch has successfully been passed on. Earlier this year word came down from head office that Matthew would get the top spot. This past July 1st
the W.A. Robinson group of companies announced him the new CEO of the W.A. Robinson group of companies.