In the six-plus months since veteran banker Ralph Strayhorn and investment manager Tom Hoops started New Republic Partners, the Charlotte-based financial services company has added a half-billion dollars in assets to reach about $1.8 billion.
The growth shows their model of mixing wealth management and banking services aimed at extremely wealthy people is working, the executives told me in a recent interview at their Dilworth neighborhood office. Clients stretch from the Carolinas to Texas, while the company’s Roanoke Rapids-based bank provides lending and deposit services.
New Republic seems like a can’t-miss proposition given it has backing from the John M. Belk Endowment and the Close and Belk families, two of the Charlotte region’s most wealthy and influential clans. The families joined their separate investment offices to spur a $30 million capital raise to start New Republic, which mainly offers its services to investors holding $10 million or more. Strayhorn and Hoops have used the money to build a 27-person staff.
But Hoops notes that execution and exceeding its clients’ expectations will be essential for the company to achieve its goals.
New Republic’s premise is that its clients can gain access to opportunities that typically are available to even wealthier investors or large institutions. The company has also created six private investment funds that are being offered to both large investment clients and accredited investors, usually typified as having an investable net worth of $1 million or more. An example is a fund that invests in private equity.
“We’ve been both pleased and humbled at the response we’ve received,” says Hoops, who is president and chief operating officer.
When I wrote about New Republic’s formation in February, Hoops and Strayhorn noted the importance of diversification for investors given concerns that U.S. stocks were overvalued. Since then, the S&P 500 Index has gained another 9% and is trading at a record level.
Nothing goes up forever, says Hoops, who is a 35-year industry veteran who had senior jobs at Legg Mason and Wells Fargo and its predecessor institutions. “It’s a tough time to be an investor” given so many conflicting signals, he says. “The pace of change now is unlike I’ve seen in my career.”
No one can predict the market’s future, but Hoops says big and small investors should adapt portfolios to succeed in today’s environment.
- Seek global diversification.
- Look for ways to invest in private equity and private credit opportunities.
- Diversify with absolute return and real assets.
- Be vigilant in seeking low fees and taxes.