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Forbes and Barron’s top-ranked CapWealth Advisors take holistic approach to wealth management


Forbes and Barron’s top-ranked CapWealth Advisors take holistic approach to wealth management

PHOTO: Timothy J. Pagliara is the founder, chairman and CEO of CapWealth Advisors, a wealth management firm he founded in Franklin in 2000. / Peyton Hoge Photography

By BROOKE WANSER

Inside a Cool Springs office off Meridian Boulevard sits one of Williamson County’s lesser-known power players: CapWealth Advisors, a wealth management firm consistently ranked among the best in the region.

A few months ago, CapWealth founder, chairman and CEO Tim Pagliara was simultaneously recognized by Forbes and Barron’s as the top wealth advisor in Tennessee, with $1 billion in assets under management.

Pagliara founded CapWealth in 2000, but his roots in Middle Tennessee’s financial community go back to 1983, when he began working at Edward Jones’ first office in Nashville.

Over the years, frustrations with the industry led to the development of a meticulous approach to financial planning.

“It was very transactional, and customers were not being treated well,” Pagliara said, noting the commission-based strategy many financial advisors employ. “It was kind of the Wild Wild West of taking care of clients.”

And, “nobody knew what the return on their money was,” he added.

A St. Louis native, Pagliara applied his love for Cardinals baseball statistics to financial planning and investment.

Working for Edward Jones during his second year at the St. Louis University School of Law, Pagliara was handed a dossier of financial information for Cardinals pitcher Bob Forsch, who he discovered was being defrauded by his agent.

Pagliara recruited his securities professor and his law firm colleagues to help straighten out the situation.

“This is how you run this business, you control the client,” he thought. “You do things for clients, you don’t work for these guys,” he said, referring to the lawyers.

After successfully helping Forsch, Pagliara decided to curtail his plans to become a litigator and focus on investment.

Investment strategy

CapWealth’s research methods and approach to investing “rivals anybody on Wall Street,” Pagliara said, of what he referred to as, “this little firm in Franklin, Tennessee.”

Unlike many financial firms, which cannot articulate specifics for return on investment, “every client we have, they know exactly what the return on their money has been, adjusted for every dollar they put in their account and every dollar that’s come out,” he said.

He trademarked the term “provable integrity” to describe the process of portfolio aggregation and analysis service which shows clients how investments perform over time by building on familial financial history.

Another approach, “sophisticated simplicity,” came from Pagliara’s frustration with impermanent Wall Street algorithms.

Through detailed analyses, CapWealth determines which investment options are the best fit for clients for the long-term.

For example, when Amazon began to take over the market last fall, counterintuitively, CapWealth purchased Macy’s stock.

“They do have a great business, and they do have some of the most valuable real estate in the world. I don’t think Amazon’s going to put them out of business,” Pagliara said.

Clients

Though CapWealth has clients from all over Middle Tennessee, Pagliara estimated 60 percent live or operate businesses in Williamson County.

“Our clients are sort of the millionaires next door,” Phoebe Venable, CFA, CapWealth’s president and COO, said “The people that have that kind of wealth, but it doesn’t show. They didn’t come out of vocations that would traditionally lean to accumulating wealth,” she said.

Phoebe Venable, CFA, the president and COO of CapWealth./Peyton Hoge Photograph

Venable came to CapWealth in 2010 after working in the industry for over 20 years, most recently with SunTrust offshoot GenSpring Family Offices.

When Pagliara moved to Nashville, he accumulated a network of clients and connections by going door-to-door, handing out his business cards. He would then send each a thank-you note, and four to six weeks later, he would return and visit again.

When asked how many people he met that way, Pagliara responded without hesitation, “Over a thousand.”

“It takes a lot of time and a lot of guts,” he admitted.

“A psychology degree would have gone a long way, probably,” added Venable.

“But it all worked out, and it all came together,” Pagliara said.

Opportunities to learn and millennial outreach

At an event last fall geared toward millennials, a group gathered for a tour and tasting at Nelson’s Green Brier Distillery.

“Come have a drink with us, ask questions, eat some food,” said Senior Vice president Jennifer Pagliara, who handles many of the millennial clients.

Jennifer Pagliara, the firm’s senior vice president and a financial advisor.

“A lot of millennials think a financial advisor is old and stuffy, so we’re just trying to make it more approachable for them,” she said.

Ms. Pagliara, a millennial herself at 30, switches off with Venable on penning a weekly column in the Tennessean about personal finance.

Last year, she was recognized by Forbes as one of the top millennial advisors in the nation.

A roadblock to financial success that Ms. Pagliara said she works to overcome is a discomfort around discussing finances.

“Sometimes in the South especially, it’s really hard for people to talk about money,” she said. But, “if they don’t tell me everything up front, it’s hard to plan for them.”

Building intergenerational wealth

CapWealth’s approach to handling clients’ wealth is holistic. By building long-term relationships with advisees over their lifetime, advisors often end up working with their children and grandchildren.

“What we’re trying to do is sustain growth and be responsive to the needs that we see in our client base,” Pagliara said.

What prevents most families from transferring wealth down to the younger generations, Venable said, is a lack of understanding from children and grandchildren on how to responsibly handle assets.

One innovation Venable helped introduce is the money camp, a summer camp for children ages six to 18 to learn concepts like inflation and compound interest.

“We play a game about diversification with the color of M&M’s,” she said.

Opportunities to learn are not limited to the youth, though.

At a recent CapWealth event, Harvard cryptocurrency scholar Dr. Harpreet Singh spoke to a group of advisees about Bitcoin at a luncheon at Belmont University.

“This is not a one-size-fits-all type place,” Pagliara said. “We really challenge conventional wisdom every day.”

Achieving success

For the ranking, both Forbes and Barron’s took into account asset growth, assets under management and customer complaints, among many factors.

Pagliara said Forbes took into account charitable work, including his service with Mwenge Catholic University, a school he helped start in Tanzania 18 years ago.

Venable also noted CapWealth advisor’s individual attention to each client’s finances.

“Ninety-five percent of firms our size, they outsource it,” she said.

Venable attributes the company’s success to that strong work ethic and a desire to serve.

“At the center of all of us is a heart of service, and we want to help others,” she said. “Maybe the secret to being successful is that you really want to help people. I think it shows.”

“I think I would refine that a little,” Pagliara added. “Try to do the right thing. Even when it’s cloudy.”

About The Author

Brooke Wanser is the associate editor for the Franklin Home Page, and can be reached at brooke.wanser@homepagemediagroup.com. Follow her on Twitter at @BWanser_writes or @FranklinHomepg.

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