[TechSparks 2020] Soumya Rajan of Waterfield Advisors on guiding Indian family offices to sustainable wealth creation

In a virtual fireside chat at TechSparks 2020, Soumya Rajan, Founder & CEO, Waterfield Advisors, emphasised that this group is a valuable source of capital to the startup ecosystem along with providing strategic advice to founders.

A banker who headed the global private banking practice of a leading MNC bank well below the age of 40, Soumya Rajan felt there was something missing and decided to leave the comforts of a secure, well-paying job and turned into an entrepreneur.

“It was a difficult transition,” said Soumya Rajan, Founder & CEO, Waterfield Advisors, a boutique investment advisory services firm for wealthy family offices at a virtual fireside chat of TechSparks 2020.

She could not fall back on past achievements and all that mattered was one’s personality with the ability to build that trust. Now, just under a decade, Waterfield Advisors is managing 70 family offices with over $3 billion assets under management.

Waterfield Advisors Founder & CEO Soumya Rajan (left) with YourStory Founder & CEO Shradha Sharma

Soumya saw there was a big gap in how wealth management industry was operating as majority of them were more interested in selling financial products rather than helping these family offices in strategising on how they can manage and grow their capital.

“This needed a break as the Indian family offices had evolved and there should not be any misalignment of interest,” said Soumya.

On the aspect of building the trust, She said, “One has to earn that respect and we genuinely have no conflict of interest.” Waterfield is very transparent in their relationships as its earnings come only through commission from its clients and they do not sell any financial products.

Providing an overview of how family offices allocate their capital and the kind of strategic role they can provide for entrepreneurs, Soumya said, globally around 35-40 percent of their wealth is dedicated towards private equity (PE) and venture capital (VC), though in India the family offices are now warming up to this concept.

Though the key value that family offices bring to the table is that when they are allocating capital for venture funding or private equity, they are able to look from the eyes of the entrepreneurs.

“Family offices are subject matter experts and are incredibly patient capital where they would like to invest in businesses they know about,” said Soumya.

At the same time, family offices also have a broader concern on their investments, making a societal impact where sustainability is a top priority.

“Family offices are very clear that they want to make a better world,” said Soumya.

However, there are a few challenges that the Indian family offices face when they plan to route their investments towards private equity or venture funding. The lack of adequate exits in the Indian startup ecosystem has a bearing on returns on capital and taxation structure which governs unlisted companies act as a dampener.

Family offices in India are going to become important sources of capital as a considerable amount is going to be transferred to the next generation who are keen to understand on how their wealth is performing.

In building a formidable organisation to manage wealth of family offices in India, Soumya acknowledged the role that women have played in her company. “There are lots of women in our team with half of my senior leadership being women. There is a lot of personal satisfaction,” she said.

Waterfield has also hired women who have taken long career breaks. According to Soumya, they have been fabulous because they are great relationship managers with high EQ.

The goals are certainly higher for Soumya and Waterfield Advisors, as she said, “Clients work with me and stay. We want to support them through generations.”

TechSparks - YourStory's annual flagship event - has been India's largest and most important technology, innovation, and entrepreneurship summit for over a decade, bringing together entrepreneurs, policymakers, technologists, investors, mentors, and business leaders for stories, conversations, collaborations, and connections that matter. As TechSparks 2020 goes all virtual and global in its 11th edition, we want to thank you for the tremendous support we've received from all of you throughout our journey and give a huge shoutout to our sponsors of TechSparks 2020.

Edited by Megha Reddy