THAT there are fund management firms with more than 80 different products to offer clients is the reason Hlelo Giyose is confident of his fledgling asset management business' future success.
He aims to operate in the sector ignored by big institutions which are better at marketing products than offering their clients real wealth creation.
"First Avenue wants to offer only investment products we really believe work for our customers' aspirations to build wealth. That's the good we want to do in society," he says.
The 40-year-old's almost philosophical approach to wealth management has found a practical outlet since he left Stanlib to open his own business in mid-2010. Boutique asset management firm First Avenue offers only two equity investment products that follow the principles of value investing.
"There can't be as many as 80 ways to make money in one firm, as some of our competitors would like their clients to believe."
It's a mistake for firms to innovate products whose practical outcome is to rook their own clients with extensive distributions and clever marketing gimmicks, says Giyose. And since it takes the next guy no more than a day to replicate a product, that mistake – by highly intelligent people – becomes an industry standard. But the maths is really simple.
With so many products competing for just a few ways to make money, it's the client who suffers for having picked the wrong one.
The friendly, easy-going asset manager throughout his career always struggled to reconcile his own thoughts about investing with those at the firms he worked for. Needing the experience and the reputation before he could convince investors to put their money where his mouth is, he stuck it out at brand name institutions such as HSBC (in the US), Investec and Stanlib.
'An entrepreneur wants to change something in his world'
In 2008 he conceptualised the idea of running his own firm when he realised there were more independent financial advisers invested in his product at Stanlib – objectively endorsing what he was doing – than there were tied agents. It took two years before he could put together the kind of money it would take to start his firm.
So why did he decide to go out on his own when there was no shortage of highly lucrative jobs for an investment specialist? Giyose says he wanted to contribute to the advancement of human civilisation no differently from illustrious investors that have gone before him.
"The trials my family went through taught me hardship isn't your enemy – that hard work isn't some disease you can catch," he says.
Giyose grew up watching his parents work hard just to become normal contributing members of the societies they lived in. Political refugees in Uganda, Botswana and the United States, they never went on holiday.
Giyose says he embraced hardship, spending every ounce of his energy to develop a better understanding of the world to compensate for his perennial outsider status.
Any entrepreneur is someone who wants to change something in his world, he says. "First, you want to explain your world. And then you want to shape it."
Giyose's plan to target pension funds as his primary market is ambitious for his small firm. But it seems a natural progression for a man who has spent his life studying the ins and outs of wealth management.