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Soumya Rajan: The financial advisor of the rich

Waterfield Advisors' Rajan identified a market niche and gap in the wealth advisory business catering to family businesses and UNHIs. Her two goals: Being a global firm, and helping women with money

Samar Srivastava
Published: Nov 22, 2021 02:28:02 PM IST
Updated: Nov 30, 2021 07:11:14 PM IST

Soumya Rajan: The financial advisor of the richSoumya Rajan founder and CEO Waterfield Advisors
Image: Nayan Shah for Forbes India

By her own admission, Soumya Rajan got things quite early in life. At 38, she was heading Standard Chartered Bank, a job people usually got to in their 50s.

But the Oxford-educated Rajan, who turned 40 in 2010, was not satisfied. This was the time when she saw an increasing mistrust of large banks after the global financial crisis. “I saw big banks under fire as clients were saying you are doing something in your prop (proprietary) book and something else in terms of the advice given to clients. There was a massive conflict of interest,” she says.

While India was still largely insulated from this level of mistrust, Rajan believed there was space for a wealth management firm that looked after only client interests. Set up in 2011, Waterfield Advisors has carved a niche for itself, advising family offices, ultra high net worth individuals (HNIs) and emerging HNIs. Her vision was to let competitors create products with Waterfield doing the diligence and advising clients on whether the products suited their needs.

So far so good, but a year after starting, Rajan nearly shut shop. Every client she would meet and explain her proposition to would turn around and say that there isn’t any model other than a distributor-led one in India. “So, if they paid me a fee, they would be paying a double layer of fees,” she says.

Help came in the form of a Securities and Exchange Board of India paper in September 2012 that laid down the need for a direct plan for customers. A few months later, the independent financial adviser guidelines came in and her industry too became regulated. Now, clients were more comfortable dealing with Waterfield and Rajan went about expanding the business with her first fund raise in March 2014.

Soumya Rajan: The financial advisor of the rich“When we met Soumya, she had correctly identified a niche and gap in the advisory business catering to UHNIs and business families. Being part of a family business ourselves, we identified with the service offerings,” says Amit Patni, who invested in Waterfield and sits on the board.

Rajan always intended to set up a business that offered a full suite of options for wealthy families and individuals. She was also clear that her business must have global scale. As a result, in the initial days, she only pitched to clients with net financial assets of ₹200 crore and above. Her first client came in from a referral from an intern. He gave her a ₹100 crore cheque asking for advice on how to invest it.

Over the years, Waterfield has broadened the suite of its services, advising clients on investment opportunities in domestic and international equities as well as unlisted businesses and private equity opportunities in addition to succession planning, estate planning and philanthropy. Rajan makes sure she charges only an advisory fee and not a product fee.

As an advisor, Rajan also wants to focus on women, as “women often come into wealth very late and need advice”. Often times they also don’t like the advisor their husband was using. Another focus area is individuals with $1-10 million in financial assets. These include management consultants, private equity partners, doctors, lawyers and also ESOP holders. Bringing them in will help Waterfield build scale.

Soumya Rajan: The financial advisor of the rich

In its 10th year, it is clear Rajan is well on her way to building one of India’s largest investment advisory firms with offices in Mumbai, Chennai, Delhi, Bengaluru, Kochi and Hyderabad. Total assets under management (AUM) are at $4.3 billion and she hopes to hit $5 billion by March 2022, and an employee count of 120 to 130, up from 82 today. As the business scales, there should be a disproportionate impact on the bottom line.

As of now, clients are on a flat fee, but Waterfield is working to moving them to a percentage fee structure. The highest charge allowed is 2.5 percent, but Rajan says she would be comfortable with 60-65 bps. “We have successfully onboarded annuity fee-based clients who are terrific spokespeople for our brand,” says Arihant Patni, who also sits on the board of Waterfield Advisors.

Rajan, a travel buff, has not had the time to visit any new place during the pandemic. But her AUM has grown by 40 percent in the last year. And that’s a trade-off she will accept with both hands.

(This story appears in the 03 December, 2021 issue of Forbes India. To visit our Archives, click here.)

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