Defying assumptions, Dan Chung, chief govt officer of Fred Alger Administration, rebuilt the funding workforce and, certainly, your complete cash administration agency after it misplaced 35 folks within the assaults on the World Commerce Middle on Sept. 11, 2001.
CEO David Alger had perished within the North Tower, and Chung, who had simply turned 39, instantly turned the agency’s chief. Founder Fred Alger, David’s brother, was retired and residing in Switzerland.
“If you wish to speak about which corporations had the most effective enterprise restoration after 9/11, I believe Alger can be among the many High 10 of any business,” Chung says in an interview with ThinkAdvisor. “Within the funding world, I believe we’re No. 1.”
Chung, who just lately acquired a 2023 ThinkAdvisor LUMINARIES award for neighborhood impression, discusses management classes he realized on the helm of the growth-investing boutique in addition to latest tendencies capitalized on, corresponding to actively managed ETFs.
Chung, now 61, who turned CEO in 2006 after his appointment as president three years earlier, brings up a couple of of his management “weaknesses,” as he calls them, and advises hiring gifted folks to “complement” any shortcomings.
“I do know that I’m not a pure gross sales [and marketing] govt …,” he says. “Maybe if I had been [one] with a lot of that have, as a substitute of the agency [managing assets of] $22 billion immediately, we might be at $60 billion.”
Chung joined Alger in 1994, after 4 years as a lawyer. Earlier than taking up, he served as a senior analyst on the funding workforce, portfolio supervisor and head of know-how.
Within the telephone interview with Chung, who was talking from his workplace at Alger headquarters in New York, he notes his excessive hopes for synthetic intelligence, “a megatrend,” which, he says, will assist advisors “the place used accurately.”
Listed below are excerpts from our dialog:
THINKADVISOR: When Fred Alger Administration misplaced 35 folks on 9/11, amongst them David Alger, the agency’s chief, you instantly turned chief funding officer and head of the agency. What was the business saying about Alger’s future?
There was plenty of doubt on Wall Avenue whether or not we might survive. Most anticipated us to exit of enterprise.
Most consultants and advisors put us on maintain or terminated us. They weren’t investing new cash with us for a number of years, watching whether or not we might survive.
In 2006, you had been named CEO. What’s your greatest management success?
Rebuilding the funding workforce, producing funding efficiency, rebuilding the agency and in the end successful again purchasers.
We had been one of many hardest-hit corporations [on 9/11] and, as a boutique, not one of many greater ones.
However if you wish to speak about which corporations had the most effective enterprise restoration after 9/11, I believe Alger can be among the many High 10 of any business. Within the funding world, l suppose we’re No. 1.
Have you ever made any management errors?
Not a mistake — however maybe if I had been a gross sales and advertising and marketing govt with a lot of that have, as a substitute of the agency [managing assets of] $22 billion immediately, we might be at $60 billion.
What latest tendencies have you ever aggressively capitalized on?
We strive to not comply with tendencies for the sake of tendencies. We attempt to hearken to our purchasers, and once we see a requirement for one thing, we wish to meet it.
For instance, beginning in 2020, we launched actively managed ETFs. That’s been giving buyers preferring the liquidity and tax effectivity of ETFs a approach to put money into a number of of our methods that had been in mutual funds.
We’re additionally seeing curiosity amongst buyers in U.S. development equities abroad, corresponding to in Europe and Asia. So we’ve been investing in these and employed two senior vice presidents to move enterprise growth.
What tendencies do you see on the horizon?
I and the remainder of the funding workforce are very targeted on AI and the way it’s going to development for a lot of industries, services.
We see AI as a megatrend that’s driving funding alternative on all ranges and in all sectors.
How will it’s utilized in enterprise?
AI may have purposes each internally for companies to enhance their advertising and marketing and gross sales, and manufacturing and logistics effectivity.
It’s additionally going to create plenty of alternative for corporations that present the know-how, whether or not it’s software program, {hardware} or information analytics.
We’re very within the AI development and who would be the suppliers of know-how and companies which can be powered by AI, in addition to how will probably be utilized and what corporations will profit from it.
How will AI profit monetary advisors?
It might actually assist advisors, the place used accurately, in servicing purchasers and conserving them higher knowledgeable and in serving to advisors change into extra environment friendly within the again workplace.
Nevertheless it’s undoubtedly going to be a problem. The place you’re not capable of compete on a know-how foundation, you possibly can compete on a distinct foundation, like personalised service and understanding your purchasers. I don’t suppose AI will likely be up for that job for a very long time.
What management classes are you able to share?
Recognizing that having a tradition that rewards exhausting work and efficiency, a meritocracy, is essential. We let expertise rise by means of the ranks once they’re fairly younger.
