Former Glenwood principal joins multi-family office. Pioneering multifamily-office Veritable Investment Consultants has hired David Gordon to assess and implement alternative investment strategies for its ultra-high-net-worth clients. Veritable says the move is calculated to enhance its standing as a leading investment advisor to wealthy families.

Gordon had been a principal of Glenwood Capital Investments, a Chicago-based fund-of-hedge-fund manager owned by Man Investments, the London-based alternatives giant. Earlier in his career, as a v.p. with Goldman Sachs, he co-wrote a 1998 study called Hedge Funds Demystified: Their Potential Role in Institutional Portfolios.

"David is an innovator in the alternative asset space," says Michael Stolper, one of Veritable's two general partners. "He saw opportunities in the hedge-fund market back in 1998 that few others envisioned, and [he] will contribute greatly to our culture of creativity and unique research."

Gordon says he was attracted to Veritable by its objectivity and its early recognition of the importance of open architecture and hedged strategies in the portfolios of wealthy families. "They have a very impressive 20-year record of advising wealthy families," he says.

After taxes

"Veritable doesn't simply follow the crowd in selecting investment managers," Gordon adds. "It is talking to money managers today that other multi-family offices might not hear about for years."

Another crucial point in Veritable's favor, says Gordon, is its strong after-tax focus.

In fact, a study by Lipper shows the mutual-fund universe losing nearly 20% of its gains to taxes over a 10-year period through 2004.

John Scuteri, one of Veritable's partners, says his firm's emphasis on after-tax investment performance goes back to the earliest years of the firm. "We have a history of reporting investment returns net of taxes," he says.

Scuteri adds that Veritable - which he says was an objective, client-first advisory to high-net-worth families before the term "multi-family office" was coined - is also an innovator in the application of alternative strategies. "We were applying the logic of hedged strategies in people's portfolios in the early 1990s."

In keeping with that history of innovation, Gordon says his role at Veritable is to pinpoint "niche opportunities where the ratio of opportunities to capital seeking those opportunities is very attractive today, identify a different set of opportunities we think are going to be attractive in the future," and help devise "innovative solutions for our clients, who all pay taxes."

Vertitable's legacy goes back to 1986 when Stolper and Edward Bowman founded Stolper & Co. In 1997, Stolper & Co. merged with Family Wealth Management, a unit of PNC Advisors managed by Jonathan Scott, to become Hawthorn. In the spring of 2004, Hawthorn's management team - led by Stolper, Bowman and Scott - bought Hawthorn's investment consulting business from PNC and re-branded it as Veritable.

Based in Newtown Square, Pa., Veritable supervises $7.3 billion in client assets. The firm has a total staff of about 65 and works with about 150 families. -FWR

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