Banyan fuels growth by zooming in on acquisitions

Back in his college days, Peter J. Raimondi had a penchant for photography, composing shots with an acute awareness of factors — color, depth, light and texture. If his personal circumstances had been different, he might have pursued it as a career.

Instead, he’s developed a subtle eye for deal making.

Mr. Raimondi, 59, is among the most successful acquirers of independent wealth management firms in the U.S. In the last five years, he’s bought seven.

After he jettisoned the idea of a career in photography — Mr. Raimondi was already married and had a daughter to support — he ended up taking a job advising executives on their finances. In 1986, he founded his own financial planning firm in Boston, the Colony Group.

After analyzing the competitive marketplace, he sold his stake in that first firm in 2006. For Mr. Raimondi, competition meant expanding investment offerings, scaling up and moving out of Boston. Later that year, he founded Banyan Partners.

Buying other firms has been an important part of his strategy. The reason? Organic growth is a slog.

“Banks, wirehouses, the discount brokerage business, the Schwabs and so forth, large and small RIAs — everyone out there is trying to compete for that client’s dollar,” he said. “It makes for a very competitive landscape and it’s a lot of work to organically grow your business.”

“AN ENTREPRENEUR”

His acquisitions gave the firm the highest rate of growth among RIAs in the three-year period ended May 30, according to the InvestmentNews fee-only advisers database.

“This guy’s an entrepreneur,” said Mark P. Hurley, chairman and chief executive of the Fiduciary Network, which invests in wealth managers. “A lot of advisers are forced to become entrepreneurs to do what they want to do. He’s a little different than some of the guys in that he’s a business starter.”

The newly added firms bring unexpected perks, such as the trader who took a liking to options after joining from Weiss Capital Management, which Banyan acquired in 2011. That trader, Sebastian Leburn, has now taken on the responsibility of managing hundreds of millions of dollars in options strategies, Mr. Raimondi said.

Mr. Raimondi said he’s also benefited from the insight that some of the aspects of delivering wealth management — namely, financial planning — are not easily scaled or highly profitable.

“It’s not a very profitable side of the business, and the margins can never be there because you can’t charge enough for your services,” he said. His firm emphasizes its proprietary investment management strategies.

Recognizing Mr. Raimondi’s successes, Boston Private Bank & Trust Co. an-nounced plans in July to acquire the firm in a deal valued at about $60 million —an estimated nine times Banyan Partners’ annual profits.

Boston Private is getting more than the firm’s turbo-charged growth. The wealth management units will be consolidated under Mr. Raimondi as chief executive, Boston Private has said.

Like a good photo, Mr. Raimondi’s business is dynamic and precise. “Everybody wants to make acquisitions — very few people do,” said Mr. Raimondi. “We’ve demonstrated the ability to execute.”