In 4 years, Dehradun duo build Rs 500 crore assets

By Morningstar |  17-01-19 | 
 

Long-time colleagues Achin Jain and Nitin Avasthi rose through the ranks in wealth management and private banking due to their connect with clients. While Achin and Nitin knew each other from their banking days, they started working closely when they joined a foreign bank in Dehradun.  Nitin was the investment adviser to the bank while Achin worked as relationship manager.

Entrepreneurial plunge

After an illustrious corporate career spanning over a decade, the duo decided to take a pause. The ‘target’ driven job of pushing complex products to clients, sometimes, irrespective of their need, put them off. At banks and wealth management firms, they represented the manufacturers. They wanted to represent the client. This thought led them to strike out on their own. In 2014, they floated Client Alley.

“While we have had a good career growth in Dehradun, we had to move to bigger cities in order to move up the corporate ladder. Also, the sales driven targets were not necessarily in client interest. Thus, we decided to move on,” recalls Achin. Achin’s family stays in Haridwar, situated 52 kilometers from his office in Dehradun. He spends three hours every day travelling to his office.

Achin completed his computer science engineering from Roorkee and his post-graduation in marketing and finance from Pune. His first job was with ICICI Bank in Punjab.

Client acquisition

With decades of experience under their belt, Achin and Nitin hit the ground running. To begin with, they started meeting their existing clients with whom they had build a good rapport. They shared how Client Alley will work in their interest. Clients liked their approach and were happy to work with them. Over a period of time, they were able to move all past client relationships nurtured during their banking days with Client Alley. Also, existing clients referred new clients.

Fastest growing advisory firm

Today, the duo manage assets worth Rs 500 crore assets across 170 clients. Around 80% of their assets under advisory is in mutual funds. Majority of their clients are high net worth individuals who are professionals, businessmen and retirees. No wonder then their average ticket size of SIP is Rs 1 lakh. Started just four years back, Client Alley has recorded the fastest asset growth in mutual funds in Uttarakhand state.

Impact of direct plans

When asked if direct plans have impacted their business, Achin says that some clients did ask him about direct plans and he articulated the value they bring to the table. In fact, Client Alley has got many direct investors coming to them for advice after burning their fingers. “We analyzed the portfolios of direct plan investors. Their portfolios were concentrated in one or two fund houses. They had invested after seeing the high past returns of these funds,” says Achin. Achin does not assign high importance to the past returns while selecting funds for clients. Rather, he picks the best funds after looking at the fund’s current portfolio, analyzing macro trends and understanding the through process of fund managers.

Focus on research

They follow goal based advisory to ensure all recommendations are right fit. The duo takes a holistic view of prospects existing portfolio, understand their past investment experience and their future goals before making any investment recommendation. This approach helps them win over the trust of clients. More importantly, the duo spends a lot of time in researching funds with Morningstar’s Advisor Workstation which helps them create sound portfolios. “Morningstar Advisor Workstation plays a very important role in onboarding a new client. We import prospects existing portfolio and generate in depth reports which helps us fill the gaps. Clients are also impressed by the thoroughness of these reports and understand our value add. Besides, it is very useful in researching funds which helps us choose the right funds for clients,” says Nitin.

Diverse offerings

Client Alley deals in a wide array of products so that clients get everything under one roof. Besides mutual funds, the firm also offers advice on portfolio management schemes, tax consulting, alternative investment funds, foreign exchange consulting, private equity and real estate. They have collaborated with chartered accountants, lawyers, tax consultants, real estate consultants and financial investment analysts to facilitate these services.

Road ahead

Client Alley has a team of eight who look after customer service and back office operations. They have no sales staff as their clientele is growing purely through referrals.  They never intend to appoint relationship managers by giving them sales target, a practice prevalent in large distribution and wealth management outfits which the duo is accustomed to. That said, they aspire to reach Rs 1,000 crore assets across products from the current Rs 500 crore purely through word of mouth.

Their clients are spread across India and abroad. To service them, Client Alley has branch offices in Noida and Ludhiana. Another office in Mumbai is in the offing. Servicing clients across geography means they are constantly on the move. Both Achin and Nitin travel 15 days a month to meet their clients. “Dehradun is a scenic small metro and well connected with Delhi and Punjab. Many people from Moradabad, Bareilly, Delhi and those who migrated to other cities for jobs come back to Dehradun to spend their retirement days in peace.  People here are well read, travelled, mostly retirees and professionals who form majority of our clients,” says Nitin. Nitin grew up in Dehradun and completed him masters in business management from Agra. His first job was with ICICI Bank in Delhi in 2001. In 2006, he came back to Dehradun to be closer to his family.

Achin and Nitin’s journey is a shining example of how boutique advisory practices can flourish even in smaller metros.

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