Market Education
Published in BRW, July 2007
by Simon De Bruyn
Dale Gillham is a busy man. In the past six months, the Wealth Within co-founder has secured an exclusive education deal with Seek Learning, prepared his first capital raising, and increased investor funds under management to about $60 million. Granted, he did effectively come out of retirement five years ago to launch and run Wealth Within – first specializing in sharemarket education then share portfolio management – with partner Lea Zerbes.
“We were a straight education company really but we discovered that while people wanted to be educated about their portfolios they wanted me to trade for them as well,” Gillham says. “But we didn’t rush. It wasn’t until I had built a team big and experienced enough to manage people’s portfolios that we started what we call our funds management business.”
This is essentially a managed account service, where more than 300 client share portfolios are individually tailored and tweaked based on an investor’s specific risk profiles and needs. This division now contributes 43 per cent of revenues, and total funds nudge the $60 million mark.
This success has led Wealth Within to develop wholesale managed account services for independent financial planners. To do this, it needs to apply for responsible entity status, which means keeping 0.5 per cent of its assets in cash. To this end, Gillham and Zerbes plan to raise capital, with first offers going to longstanding clients. “Our clients have expressed a strong interest in investing in the growth of the company” Zerbes says. “We are doing a private capital raising and have already got 116 expressions of interest from them, some of which have supported us from the beginning.”
While Gillham and Zerbes will sell of a bit of their 90 per cent stake, he says he is not cashing in his chips. “As owners, we’ve always looked at ourselves as the last to be paid – there is continuous reinvestment in the business. We’ve never borrowed money; we could have borrowed to grow faster but that would have put pressure on the staff. When we exit the business eventually will be when we reap our rewards. We are different and we want to be pioneers, which means you’ve got to spend the dollars. The funds management industry is a closed shop and we are happy to shake up the industry just by sticking our neck out and always aiming to deliver to clients.”
The business plan follows a strategic review at the start of the year that helped Gillham and Zerbes decide to focus on building the education and investment business further instead of changing tack or launching other business arms. They started looking for partners, especially bigger ones that could take up the sales and marketing slack that Wealth Within hadn’t really developed, and soon a deal with Seek’s education division was struck. Gillham claims Seeking Learning looked into every possible course in the country before signing with Wealth Within to provide its government-accredited Diploma of Share Trading and Investment through its online portal.
