The Path Ahead in 2023

When you go through a year like 2022, sometimes it’s a good idea to take a deep breath and digest everything that happened before looking back. Now that we’re into February, I’m ready to do that.

For Coldstream, it was a year of contradictions. On the one hand, markets experienced extended bouts of volatility, with nearly every asset class suffering heavy losses, including real estate, tech stocks and bitcoin, all of which combined to lead rallies during the height of the pandemic.

Naturally, clients get uneasy or even scared when they see their portfolios decrease in value. But at the same time, periods like this demonstrate the value of our industry. Indeed, an experienced, calm, and planning-focused financial professional can help investors avoid devastation and keep them on track to reach all their goals and dreams.

On the other hand, the firm had a lot to celebrate last year. We added offices in Boise and Alaska to go with our existing presence in Bellevue, Seattle, Mercer Island and Portland. Also, we welcomed 18 new professionals, including Natalie Straub, who oversees the development and implementation of our ambitious growth plans in her role as Chief Revenue Officer.

Meanwhile, our management team has never been a better reflection of the communities we serve. Half of our firm leaders are female, nearly a third are people of color and an equal number are under 45 years old.

Affiliate Growth  

I am also happy to report that our affiliates continue to flourish. Fit Insurance promoted Cynthia Morales to an account manager, was recognized as a top broker by Pure Insurance, and onboarded nearly 50 new households last year. In all, its assets under risk management now exceed $3 billion.

For its part, Ascent Capital hired Jeff Huber as a business development manager and grew its loan portfolio by nearly 50%. Also, the Rainier Group, which provides strategic advisory and investment banking services to public and private middle market companies, advised on a record number of M&A transactions.   

The Path Ahead 

Despite rising interest rates, firm consolidation within financial services continued last year, with dealmaking up by 10.7% over 2021, according to Echelon Partners. Most of this activity is being driven by private equity firms, which have gobbled up practices and pieced them together in an effort to achieve scale.

But at some point, there will be an exit (that’s the private equity business model), which can lead to cost-cutting and other measures in the name of efficiency that can impact service. That’s why we have opted to grow differently, and that approach will continue in the year ahead and beyond.

Moving forward, our firm will focus our efforts on the following areas of our business:

Developing our people and cultivating our culture. Having a great firm and providing an excellent service experience for clients is inextricably linked with investing in and nurturing the talents of our team members. Part of this process begins with establishing a clear set of values and trying to be true to them each day. But the other element is creating avenues for more professional development, whether mentoring programs, DEI initiatives, or groups focused on serving the unique needs of various demographic groups.

Enhancing our technology support systems and enhancing the client experience. This doesn’t mean that we plan to spend heavily on elaborate trading systems, which do very little to improve outcomes for planning-focused individuals and families. Rather, we will invest resources in the latest enterprise-focused platforms and tools that complement what we already have and streamline administrative and other back-office tasks. That way, our team members can do what they love doing most – working with and serving clients.

Growing the right way. Like any business, we have growth goals. But we want to pursue them purposefully and thoughtfully, which starts with remaining independent and employee-owned and adding more qualified professionals to Coldstream while retaining the special group we have already assembled. We don’t want to grow for growth’s sake. That’s not a sustainable model.

Though 2022 was undoubtedly a year to forget when it comes to stocks, bonds, and virtually every other investment, I’m optimistic about what lies ahead for the rest of 2023. We look forward to guiding our clients through their wealth management journey and growing together with them and their families.