There is nothing more central to understanding Michael Nathanson than books. He reads them by the hundreds and embeds their prescriptions into his personal and professional life. Name a subject and he is likely to cite a tome that speaks to it.
Perhaps none has been more important to his career success than How Google Works, co-authored by a pair of Google executives. That book contributed mightily to a change in thinking that buttressed Nathanson’s confidence.
“Have you read that book?” Nathanson inquires. “I highly recommend it. It talks about how humans are all taught from birth what we cannot do, and the real secret to success is learning to unshackle ourselves from those chains that hold us down. Once you start realizing all you have to do is believe, it is amazing what you can actually do. To this day, this is what I preach at our company — that all we really need to do is believe in ourselves and we, as a company, will achieve our potential as well.”
That transformational thinking gave Nathanson a level of self-confidence he had never known before and set his life and career on a different arc.
“There is no question, confidence is the characteristic that has most contributed to my success,” says Nathanson.
Talk to him about travel and Nathanson is likely to cite the book Great CEOs Are Lazy.
“I actually keep track of the number of countries I have been to — about 50 so far — and one of the things the book talks about is that great CEOs are constantly educating themselves; they are lifelong learners,” he says. “Traveling is a fantastic, efficient way to educate yourself. The world is an extraordinary place, and there is so much to learn from it.”
Another example is company culture. Talk about that and The 15 Commitments of Conscious Leadership springs to Nathanson’s mind.
“There is this concept of conscious living or conscious leadership, and it is one where we practice having awareness around our emotions, and our state of feeling, and how we are interacting with each other,” he explains. “We make commitments as to how we are going to live our lives, including within our company. For example, we make the commitment to experience each other as allies. We make a commitment to utilize ‘radical candor’ with each other. We make commitments to taking 100 percent responsibility. But, above all, we make commitments to have awareness about where we are — to understand when we are in drama, why we are in drama, and try to shift out of that drama.”
FUTURE PRESIDENT
Nathanson grew up in Framingham, Mass., the son of an attorney, and headed to Brandeis University to study American history and Spanish language and literature. Even his decision to study Spanish was book-related, part of his desire to immerse himself in Spanish literature, which Nathanson wanted to be able to read in its native language. One of the courses enrolled in was about Don Quixote, one of his favorite books.
“Reading that book in the native language is an extraordinary experience,” he says.
One might say that, like Don Quixote, the 16th century Spanish gentleman, Nathanson went in search of chivalrous adventures when, after noticing Brandeis did not have fraternities, he decided to create one that “accepted everybody.” That effort turned Nathanson into a “founding father” of Alpha Epsilon Pi at Brandeis.
“It was basically a social club. I love bringing people together and collaborating with people. I’m a social person. We grew some great bonds with each other. Some of my fraternity brothers are to this day some of my best friends.”
Though his tenure at Brandeis appears rich with accomplishment, it was at Harvard Law School that Nathanson felt self-confidence truly start to assert itself. As mentioned above, his father, whom he admired, was a lawyer, and it was the era of the hugely popular TV program “L.A. Law.” At Harvard, Nathanson found himself in the same classrooms with future Supreme Court Justice Neil Gorsuch and future President Barack Obama. Nathanson and Obama took all of their first-year law classes together.
“I remember him so well from law school — everyone did. He was just one of the smartest people in the class, and he talked a lot in class and was very comfortable and confident,” he recalls of Obama. “In retrospect it absolutely makes sense that he was capable of becoming President. He was a true leader — brilliant, confident, comfortable. He brought people together. Until you have had someone in your class become the President of the United States, you have never fully had a lesson in humility.”
MAKING THE MOVE
Post-graduation, through a series of “freak occurrences,” Nathanson became a tax lawyer at Wilmer Cutler Pickering Hale and Dorr, one of the top 50 largest U.S. law firms, quickly becoming a senior equity partner and holding several leadership positions. It was at Wilmer Cutler that Nathanson became interested in wealth management after he started attracting some clients in that space, including The Colony Group.
“I had a great career going for myself at the law firm, but I loved the team of people at The Colony Group, which was relatively small at the time — less than $600 million under management,” he recollects. “They invited me to come and join them, and I thought to myself, I would have to be crazy to do that, I’ve got an equity partnership at a law firm that people could only dream about being part of. Sometimes I can’t believe I did it. I actually came to The Colony Group with no agreements, just came on a handshake.”
Though it was understood Nathanson was making the move to become the firm’s future CEO, he agreed to start his tenure as CFO and general counsel. He joined as part of a succession plan arranged by Colony Group’s founder, Kirby Hamilton, who retired in 2011.
Nathanson now carries the titles chairman and CEO of The Colony Group, and today the firm stands at more than $11 billion in assets under management.
THE HUNT
The Colony Group’s expansion plan has been aggressive, having completed about 10 acquisitions over the past nine years, though Nathanson favors the term “strategic transactions” or “mergers.”
“Technically, most of them were acquisitions, though I prefer the term merger,” he says. “I don’t like the term acquisition because to me they are two different things and, regardless of size, the most respectful and accretive way to do transactions is merging companies together, taking the best of both worlds.”
Those acquisitions have also included a couple of strategic hires — in one case an adviser, in another a team of three advisers. Along the way, the firm has expanded from two offices to 15 offices in eight U.S. states, and the asset and wealth management firm has branched into new but related businesses, such as institutional asset management and business management services for entertainers and athletes.
More mergers are in the offing, according to Nathanson, as part of The Colony Group’s five-pillar strategic plan, which entails elevating its people, adding new services, optimizing its existing platforms and processes, reaching the organization’s full potential for organic growth, while also continuing to pursue inorganic growth through continuing merger activity.
The inorganic growth plan for 2020 calls for building a pipeline of candidate firms for 2021.
“Our intention is to consolidate and integrate recent strategic acquisitions while focusing on the other four pillars of the strategic plan this year,” he says. “It is not likely we will do anything significant in terms of additional transactions until 2021.”
When the firm looks to expand its staff, Nathanson says the organization goes in search of individuals with “raw talent” combined with significant doses of curiosity and humility.
“Our top value at our company above all others is that we are lifelong learners and we are committed to learning through curiosity,” he says. “I want people who are problem solvers.”
EVOLUTION OF AN INDUSTRY
Nathanson observes that the private wealth industry is gravitating from asset management to wealth management to life enrichment, and his firm has jumped into the trend with a platform dubbed Curated by Colony, which includes third-party partners providing clients with information on cybersecurity, medical services, travel options, educational consulting, career coaching, mentoring and mindfulness.
Nathanson insists, however, the firm is committed to maintaining its core focus. He invokes The Outsiders, another of his favorite books, which points out companies that outperform their peers are those that stay on track by not allowing themselves to become distracted by the shiny new objects that inevitably come along.
“Keep in mind that most of the things I’ve mentioned are consistent with ultimately being financial advisers,” Nathanson remarks. “The things that are not consistent with that practice have been outsourced to others. We know we are not medical concierge experts or travel concierge experts, so all we have done is create a platform that gives our clients access to those things. We, as an organization, have stayed focused on asset management, wealth management, tax services and business management services — these are services very much within the trajectory of providing financial advisory services. We know what we are, and we know what we’re not, but we shouldn’t be constrained by what we are not. Just because we can’t provide something ourselves doesn’t mean we can’t find a partner who can.”
THE NATURAL
That focus extends to Nathanson’s personal life. Witness his status as a third-degree black belt in the various styles of martial arts he has studied, including Kung Fu and Tai Chi, and, at 53 years of age, he is a competitive body builder, training at a fully equipped home gym. Make that a “natural” body builder, meaning no use of steroids, human growth hormones or other muscle-boosting compounds.
“We all are drug-tested, and I have to take a polygraph before I get on the stage.”
Nathanson has finished second many times in the body-building competitions and has the trophies to prove it, but he is still working toward a first-place finish.
Nathanson’s commitment to martial arts training included a trip he made to China to take lessons from a Chinese martial arts master.
“It was a spectacular experience,” he reflects.
Like reading Miguel de Cervantes or Michael Lewis, perhaps, and internalizing the literary adventures and business lessons of other great novelists and business observers. One imagines Nathanson giving full, living embrace to the oft-quoted statement from A Game of Thrones author George R.R. Martin: “A reader lives a thousand lives before he dies; the man who never reads lives only one.”
Clearly, a scarcity of lives lived will not be Michael Nathanson’s fate.
Mike Consol (m.consol@irei.com) is editor of Real Assets Adviser. Follow him on Twitter @mikeconsol to read his latest postings.