An expansion-hungry local investment firm has just raised a pile of cash.
Cary Street Partners, a 15-year-old Shockoe Slip-based wealth management and financial advisory business, closed last week on an $18.9 million capital raise.
Tom Tullidge, founder and chief strategy officer, said it will use the money to pursue acquisitions of other firms and recruit talent from competitors. That will add to its base of about 80 employees in 13 offices in six states.
“We see an opportunity in the market,” Tullidge said. “The industry is changing away from the big wire houses. The market is moving in our direction.
“This will give us the balance-sheet strength we need to attack the market.”
The capital was raised in a private placement from about 30 investors that included both local and out-of-town contributions. It was mostly equity, but also included some debt capital. The company had the ability to raise up to $22 million.
Cary Street Partners’ business has evolved in recent years. It historically had billed itself as a wealth management and investment banking firm, but Tullidge said it has shifted toward its wealth management operations, which now has $2.3 billion in client assets under management.
“The lion’s share of our business is wealth management,” Tullidge said.
It still does some corporate advisory work for clients and also has branched out into insurance services, opening an office for that business line in Summit, New Jersey, in June, Tullidge said.
It also did some rebranding in conjunction with the capital raise. It changed the name of its parent company to Luxon Financial and is now selling insurance and other services under the Luxon brand. Its core business will continue to operate under the Cary Street Partners moniker.
The company, which is planning to move its headquarters in Shockoe Slip to the 10th floor of Riverfront Plaza, was already in expansion mode prior to the capital raise. It hired six people in the last year, Tullidge said, and opened a new office in Kingsport, Tennessee, earlier this year.
He said the firm will go after talent with a mix of independent advisors looking to join a medium-sized firm, along with people currently at larger firms and looking for something smaller.
“Our target demographic is someone in their mid-30s to early 40s who are up-and-comers,” Tullidge said. “They’re right at that inflection point where it’s really taking off.”
Tullidge said this pool of capital should sustain the firm for some time.
“The $18.9 million – absent doing a major transaction, which we won’t ever say ‘no’ to – we think can carry us a few years,” he said.