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Monday, Jul 15, 2024

Investing Advice Just Part Of Peer Group’s Value

Real estate: 33 percent

Private equity: 21 percent

Public equities: 20 percent

Cash/cash equivalent: 11 percent

Fixed income: 9 percent

Hedge funds: 4 percent

Commodities: 1 percent

Miscellaneous: 1 percent

Currencies: 0 percent

Source :TIGER 21

Got a net worth of at least $10 million? Want to know the best ways to invest that money?

If you’re willing to pony up $30,000 in annual dues, and share your strategies with others in that rarefied financial strata, you can join TIGER 21, a networking group of other wealthy people also looking to maximize their earnings.

TIGER 21 stands for The Investment Group for Enhanced Results in the 21st Century. It put down roots in San Diego 10 years ago and recently started a second San Diego group in response to increasing demand in the region for a way for high net-worth peers to share concerns that crop up when managing significant personal wealth.

TIGER 21 was founded in 1999 by entrepreneur Michael Sonnenfeldt after he sold his interest in Emmes & Co., the real estate firm he founded in 1991. At the time of the sale, the company’s assets were worth more than $1 billion.

Barbara Goodstein

“He realized he was as anxious about retaining his wealth as he was about his next entrepreneurial adventure,” said Barbara Goodstein, chief executive of the New York City-based organization.

Sonnenfeldt began bringing people together to crowdsource ideas on how to invest his wealth, and the response from those with ideas and from those searching for similar suggestions revealed to him a new business opportunity.

Today, more than 500 people who collectively manage more than $50 billion in personal assets belong to the organization, which has 50 groups in 28 cities.

The groups are typically 12 to 15 people and meet monthly under the guidance of a facilitator. The $30,000 dues give members access to a members-only online forum and any research done by the organization, as well as a standing invite to a variety of events, including an annual members conference.

How Do You Keep It

Sandor Shapery

The majority of members created their wealth themselves, rather than inherited it, Goldstein said, and in doing so discovered the difficulties of navigating coming into significant wealth both financially and socially.

Longtime San Diego resident Sandor W. Shapery, who goes by Sandy, joined the first group six years ago.

Shapery, 72, is a real estate developer whose company, Shapery Enterprises, has been involved in the ownership, design and development of some of the high-rise buildings and high-rise hotels in downtown San Diego, including the distinctive Emerald Plaza building, as well as the rehabilitation of a number of local historic buildings. He is also developing a transportation infrastructure company.

“We all know how to make money in our particular niche, but how do you keep it and how do you invest in wisely beyond our area of expertise?” Shapery said. “It’s access to information … plus there’s a camaraderie and a trust created.”

The organization says it sets itself apart from other, better known networking groups in the area, such as San Diego-based Vistage Worldwide and the local chapter of Entrepreneurs’ Organization, by focusing uniquely on investments and their alignment with members’ personal goals rather than business.

Members, all of whom sign nondisclosure agreements, go through a rigorous peer evaluation of their financial holdings and how they compare with their stated goals in a process the organization calls a portfolio defense.

Second Local Group Launched in April

Jerry Swain

San Diego resident Jerry Swain leads the region’s second group, which launched in April and, with seven members, is about half full.

“There’s clearly demand,” he said.

Undergoing the financial review was an eye-opening experience for Swain in that it forced him to think about the alignment of his investment portfolio with his broader goals, outside of its rate of return, he said.

“Inevitably, a lot of the conversation is the qualitative piece, which talks about legacy,” he said. Those discussions often include insight on how to go about philanthropy and managing familial dynamics.

“A lot of people think about ‘how do I raise my children to be responsible adults with great character,’” Swain said. “Wealth can throw a monkey wrench into that whole thing.”

Some TIGER 21 members have asked their peers, for example, about how to respond to a request from an adult child for funds to start a company.

It’s those aspects of the conversation that set the organization apart from other resources of information, such as friends or wealth managers, Swain said.

“They created wealth, but they’re looking for a peer group,” he said. “If someone is looking at creating a foundation or doing philanthropy or considering investment of significance, this peer group is safe and relatable.”

Much Broader Perspective

On the quantitative side, members share investment opportunities, and some end up doing business together. How to keep the wealth they have created by putting it to work effectively is another critical aspect of the organization’s aims.

“I’ve made a lot more money, I’ve saved a lot more money, I’ve changed directions I was going in on investments … even decisions in my own business,” Shapery said. “Having 11 or 12 really smart people analyzing your issue … gives you much broader perspective, and the more information you have, the more options you have, the greater your chance of success of solving your challenges.”

After hearing a pitch from a speaker at a TIGER 21 meeting who had started a company reviewing investment portfolios, Shapery decided to hire him, paying a few thousand dollars for the service. The decision ended up saving him $50,000 yearly after Shapery’s fees were reduced through negotiation with his stock broker.

Members like to be able to talk with people who aren’t invested, in the financial sense, in the allocation of their investment portfolio, Goldstein said.

“You’re sitting with a group of your peers and … it’s completely unbiased advice: No one has anything to gain by telling you the truth or not telling you the truth and you get feedback you wouldn’t normally in any other way,” she said. “As one person said to me, I want to be in a room where I’m not paying everybody to answer me.”

Valuable Connections

Shapery also turned to TIGER 21 about five years ago when he was searching for a large diamond for his fiancée.

“Within about a half-hour I had probably five responses … which gave me the ability within a couple days to look at 10 stones that generally were out there in the marketplace and make a decision quickly,” he said. “We’re talking about people that are very successful in life and generally to become successful you have to be a seeker of knowledge. If you put something out there in the forum, you’re assured of getting connected to the best of the best.”

Goldstein said members say they consider those in their group as a kind of board of directors that provides advice on matters of finance and family.

“It’s the ultimate networking community,” she said. “People develop strong personal relationships, but there’s also a lot of financial opportunity and upside.”


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