For Summit Asset Management LLC, steady organic growth over the past 20 years has been spurred by building strong local relationships.
Lance Hollingsworth, from left, Alex Thompson and John Laughlin are principals of Summit Asset Management. Thompson is managing partner.
(Photo: Lance Murphey)
The independent financial planning and investment advisory firm is locally owned by lifelong Memphians and prides itself on an ability to always be available for its clients.
The fundamentals have not changed much for Summit since Frank Jones informally founded the firm in the late 1980s and it became registered with the SEC in 1991.
“Everyone will always be trying to save for the future, save for college or save for retirement. Our goal is to educate our clients and help them reach their goals and objectives through proper investment management and planning,” said partner Lance Hollingsworth, who joined forces with Jones in 1995.
Alex Thompson and Steve Rhea came on board as partners in late 1998, and they teamed with Hollingsworth to form a new partnership to buy out Jones’ existing interest in the firm. Jones continued to work with Summit for the next few years. John Laughlin then joined their team in 2001 and became a partner in 2007.
Sadly, Summit lost partner Rhea in May following a yearlong battle with cancer. Rhea was diagnosed with a brain tumor in April 2011.
Following Rhea’s death, Thompson sees 2012 as a year of consolidation for Summit.
Areas of interest heading into next year include upcoming state tax changes, historically low fixed income yields and the ongoing financial instability in Europe.
“We’re in unusual times right now,” said Thompson, referring to the current 1.7 percent rate for fixed income yields.
Hollingsworth agreed, saying, “We’re dealing with conditional volatility that really was not present in the previous 20 years, so we are educating our clients to have patience and look for opportunities in this low-return environment.”
The mid-sized firm maintains a focus on trying to create a relaxed “kitchen table” atmosphere where clients can feel comfortable discussing their issues.
Summit navigates clients through situations ranging from simple will revisions to very complex multifamily business transitions involving partnerships, trusts and siblings that may or not get along with each other.
Summit mentor Herbert Rhea once quipped that they often faced problems involving one of the “4 Ds”: Death, Disability, Divorce, or business Disagreements.
“Certain problems might come up once in a lifetime for an individual, however, we might see them multiple times each year. So we can bring that expertise to the table to help walk them through those issues,” Hollingsworth said.
Summit tailors its investment management for specific client goals and situations involving risk assessment, asset allocation, and portfolio implementation and monitoring. The firm’s client base consists of individuals, families, businesses, trusts, retirement plans for corporations and medical groups, and charitable endowments with accounts ranging from $100,000 to $20 million. The firm currently manages approximately $440 million in assets.
Summit handles tax planning, insurance evaluations and charitable gift planning, as well as business acquisition or dissolution analysis, family partnerships and trusts, and tax-efficient transfer and protection of wealth for future generations.
“In the past 10 years, information technology has radically changed, the way investments are analyzed and the ways markets trade have changed, and the proliferation of investment options have changed,” Laughlin said. “With this vast amount of information and all of these options, it’s harder than ever to assess what information is valid, how to interpret that information, and then choose from an array of options that has grown exponentially. We bring our expertise and experience to bear and put ourselves in our clients’ shoes, so each client gets treated uniquely.”
Thompson stressed that Summit sells no products and is not compensated by sales commissions or trade loads. Instead, Summit charges a fee based on the amount of assets under management.
“We do not sell insurance or prepare tax returns or draft wills, but we have backgrounds in those areas. We are essentially a coordinator for our clients,” he said. “We work with and maintain great relationships with most of the CPAs and law firms around town. They are fabulous resources, and we learn a lot from them every time we get into a new situation.”
Summit’s fee-based structure also helps to avoid potential conflicts of interest that sometimes arise under other payment structures.
“Our incentive is aligned with our clients – to grow the balances of their accounts and to protect their capital from being eroded by adverse market events,” Laughlin said.