Business builder tops field

WA Business News 2012 40under40 1st Amongst Equals winner, Grey Egerton-Warburton, believes a business is only as good as its clients.

It’s a belief that has set the foundation for Western Australian stockbroking firm Hartleys since Mr Egerton-Warburton became an integral part of its leadership group in 2003.

Despite having grown up at Frankland River in the state’s Great Southern, the 39 year old overlooked regional life by pursuing an early ambition to become an investment banker.

Now portraying the look of a typical banker at the firm’s St Georges Terrace address, Mr Egerton-Warburton hasn’t forgotten his down-to-earth country values.

For all of Hartleys’ success in recent years – which include being named the top resources mergers and acquisitions advisory firm in the country by completed deals for the past three years and achieving profits of almost $18 million last year – Mr Egerton-Warburton maintains a grounded view of the company’s achievements.

“It’s been great to build something here at Hartleys, but it’s been even greater to be a part of building other people’s businesses,” he said.

“I think we’ve had a positive influence on our clients – whether it is retail, institutional or corporate.

“All of this has created jobs in WA, and that increased production in either the minerals or industrial sector drives state royalties and personal income.”

This commitment to clients has driven the firm’s culture since Hartleys evolved from a management buyout of Hartley Poynton more than eight years ago, Mr Egerton-Warburton explained

Having joined the firm three years earlier, Mr Egerton-Warburton witnessed Hartley Poynton turn from a strong business into one struggling with large annual losses.

In that time, the firm diversified into a costly technology venture, changed its name twice and lost millions of dollars; meanwhile, its core retail broking business had very little advisory capacity, he added.

However, Hartley Poynton’s decline created an opportunity for Mr Egerton-Warburton as he saw an opening for a fresh start at the firm by co-leading the management buyout.

The move would pay off, as Hartleys developed a new set of operating principles that have led it to delivering profits each year.

Two years after the buyout Mr Egerton-Warburton was appointed a director of Hartleys before moving into his current role, head of corporate finance, in 2008. He is also the firm’s largest shareholder.

Mr Egerton-Warburton said the new Hartleys board set about broadening the services the firm provided, with a particular focus on building a division that specialised in mergers and acquisitions.

The new leadership group also established a flat management team and lean employee group capable of surviving the volatility of market conditions. The strategy resulted in Hartleys not making any redundancies during the GFC.

“We reshaped the firm around the guiding principles of taking a long-term view to business and always putting clients first,” Mr Egerton-Warburton said.

“We decided to build a business that provided a range of services to corporate, institutional and retail clients, which was different from other businesses in WA. 

“We also wanted a business that provided specialist mergers and acquisition advice in particular, and we thought we could build a business that developed very long-term relationships with corporates and made a real difference in the community we operate.

“WA brokers and our competitors on the east coast often don’t provide that service (in mergers and acquisitions) because it is quite a different skill set where a different breadth of experience is required from a capital raising.”

The long-term approach to clients is demonstrated by Hartleys’ relationship with WA iron ore miner Atlas Iron, which has been one of the state’s busiest companies in recent years when it comes to mergers and acquisitions. 

Hartleys started advising Atlas when it had a market capitalisation on the Australian Securities Exchange of about $60 million. Today, the company is worth more than $2.5 billion.

Mr Egerton-Warburton is quick to recognise the “outstanding job” done by the management group and board at Atlas.

He said the company was an example of how business savvy organisations in WA are these days, something he believed local companies were not always recognised for.

This lack of recognition has, at times, worked in the favour of Hartleys, with locally based companies leaning towards sourcing corporate advice from locally based advisory firms already knowledgeable in how they operate.

WA advisory firms are preferred for their better understanding of the local companies in comparison to national or international counterparts, Mr Egerton-Warburton said.

“You may have a big brand name but that doesn’t mean you have expertise in the WA market and it doesn’t mean you know how sub $2 to $3 billion companies operate in the market,” Mr Egerton-Warburton told WA Business News.

“WA companies like to deal with WA people. We’re reasonably parochial people, but that is based on sound business sense.”

In building its corporate reputation Mr Egerton-Warburton said Hartleys had relied on word-of-mouth circulating throughout WA’s business community.

Mr Egerton-Warburton has, in the past, won work after impressing directors of opposing companies involved in a merger or acquisition transaction the firm has advised on.

The directors had been impressed by the way Hartleys conducted itself on the deal and recommended the firm’s services for a transaction with other companies where they were also part of the board.

“When a recommendation comes from a director or managing director, who has provided experience of what you have delivered as a business, that’s the most powerful endorsement you could ever have and much more effective than a marketing campaign,” Mr Egerton-Warburton said.

“We are in the fortunate position where we sort through a lot of opportunities before deciding if a particular relationship is for us. Of course, there are clients we would like to have that we don’t too.” 

On that note, Mr Egerton-Warburton revealed the focus of Hartleys moving forward was unlikely to change; the firm intends to continue serving and representing the WA corporate community in the way it has for the past eight years.

Mr Egerton-Warburton regards the contribution Hartleys has made to the Perth community as representing what the firm is about.

“I think we’ve had a positive impact on the community by assisting in growing those businesses,” he said. 

“It’s just the capacity to have that multiplier effect, taking the long-term approach to business and developing those relationships. 

“Then you are there for the clients to measure success by jobs created and the impact it has on the community.

“I’ve been very lucky to enjoy working for some fantastic clients and those clients have been by and large very successful.”