A Conversation With ... Benjamin F. "Tad" Edwards IV

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Editor's note: Benjamin F. "Tad" Edwards opened St. Louis-based investment firm Benjamin F. Edwards & Co. in 2008, and its first branch opened on Aug. 17 in Springfield. The local office is led by industry veterans Tim Reese and Michael Petiford. Edwards was in Springfield Oct. 29 for the grand opening.

Tell us about your company.

We started with three people in 2008 ... and we've gone from three to more than 50. (This company is) a continuation of the old A.G. Edwards model, (a) client first, people second, shareholder third model. ... We have the same mission statement, our family's involved in the leadership, and it's really just a continuation of what we used to have. We have an advisory board (with) a lot of the former senior leadership of A.G. Edwards.

How did you select Springfield as the home of your company's first branch?

We really liked and thought a lot of the group here, a group of five. Also, for the first office, we thought it might be nice to have it close by. ... I think Springfield is a great middle-market community.

Was it hard to let go of the family business in the Wachovia merger?

I was a member of the board at the time, and I wasn't for the sale. I didn't know about it before it happened, but as we all know, in life and in work, you look forward and move forward ... and we have a wonderful opportunity with (Benjamin F. Edwards & Co.).

Did you have any qualms about starting an investment firm as the economy already was showing strain?

We saw enormous opportunity. ... I want to make sure it's clear that this is not really a startup. The majority of people who worked at A.G. Edwards in the home office were information technology and operations people, probably 60 percent.

We have outsourced the IT and operations to a place called Pershing ... so we don't really have to build the whole company from scratch. ... The full-time people we have in the home office, 100 percent are from A.G. Edwards' home office, and they average about 25 years' experience. ... We're hiring people in the branch system, brokers, and so far, they've all been with the old Edwards firm.

What are the differences between your new company and the old A.G. Edwards?

A.G. Edwards was public (and) we are a private company. ... We choose to be independent. We don't ever want to be bought out. We have no interest in that. A public company, (if) someone comes in and wants to buy you, you can be very vulnerable. A private company can control that.

Are you open to using mergers and acquisitions as a growth tool?

We would never want to be bought out, but on the other side, if the right company existed, with people who shared our value system ... we would be open to that. ... We've had a couple of things come our way already, and people say, "Would you have an interest in acquiring us?" So far, we've passed, but at some point, we'll always be willing to look.

I'll say one thing that will never change: We never want to compromise the integrity, character and trust just to get bigger.

How much weight do you put on U.S. gross domestic product, which grew 3.5 percent in the third quarter, in terms of gauging the economy?

First of all, I'm not an economist, but ... I think there's some quantitative evidence that shows a recovery. ... When employers start hiring people back - and I think they probably are starting - that's the key, because ... if we don't have real jobs, we're not going to go to Applebee's (or) to the store and buy something and keep that economy flourishing. The theme is that there's optimism - which we have, too - but I think we all know that it's not all solid yet.[[In-content Ad]]Was opening your firm a way to return to the family roots?

I think there's a lot of truth to that. When you have a company in the family for 120 years and six generations, that legacy is deep in the ground.

What sorts of management examples have you received from your family?

At the old A.G. Edwards, we went 115 years and never laid one soul off. Even during the Depression, when my grandfather ran the firm, we could have easily laid people off and justified it. ... I would love to have the same thing happen. I remember in the early 1970s, when the markets were very difficult, and the early 1980s, guess who took the first pay cut out of all the employees? My dad, because he thought that would set the example. At (his) funeral in April, I gave (this) story: My dad parked every morning under (our) big tower (and) there was a private door you could go in, using a little card. He didn't use that. He walked outside and spent a couple minutes more walking into the lobby like everybody else. I said, "Dad, why do you do that?" And he said, "I want to talk to the security guards, ask them about their families; talk to the receptionist and give her a hug. And a light went on, and I said, "That's it." He cares about everybody, not just the top people. ... He would walk down to the printing department, the supply department (and) shake their hands, and say, "It's people like you who make this place a special place to work." I don't think a lot of CEOs probably do that.

Do you still do hands-on portfolio advising?


No. My objective is really to lead the firm, build the firm all over the country (so) that can't be my first goal.

Do you anticipate adding a branch in Chicago at some point?

Sure, and in many other places. I think our strategy is really not very complicated. We don't really want to go to a certain place just because it's an exciting place. We want to go somewhere where we can have the right people ... who are of high character, successful and who loved and treasured A.G. Edwards the way we used to have it.

How has the economy affected investor attitudes?

I think that they've gotten better. The markets were down more than 50 percent in a short period of time, and that was very painful for a lot of people, especially older people, who may not have been working and may be too old to work or not able to work. Your heart goes out to them. The good news is, a lot of investments have gone back up 30 percent, 40 percent, 50 percent for those who were patient and willing to wait. ... We've come back a little more than halfway, and I think everybody hopes that we will work our way, over time, back to where we were before and beyond that. ...The markets generally anticipate an economic recovery, let's say, six months to 12 months in advance. But you could almost put that aside and say that no matter what the economy's doing, whether the market's high, whether the market's low, people need to have a plan for their financial lives. Everybody does. Generally, the main theme is retirement. We want people to have enough money, ample money, so they never have to worry the rest of their lives.