A rich career providing advice to the wealthy

Thom Melcher does not have your average investment-management job.

As managing director and chief investment officer of Hawthorn, a wealth-management unit of PNC Financial Services Group Inc., Melcher deals with clients looking to invest at least $20 million.

Hawthorn, based in Philadelphia, oversees $16 billion for nearly 400 families in 30 states.

Melcher, 38, who lives in Haddonfield, gets very involved with clients, sometimes receiving calls in the middle of the night because they see him as a kind of Dr. Phil who can help with a family crisis.

Question:

How have Hawthorn's rich clients responded to the recent turmoil in the markets?

Answer: We found that the ultra-affluent, in general, were more optimistic, more bullish and more ready to actually enter in on the buy side during this market time than lesser affluent people. Now, having said that . . . the reality is my clients are as anxious as anybody. . . . When the stock market is selling off significantly, the phone rings. Because again, you have to remember that $20 million is the entry point. Many of the clients that we deal with have $100 million or $200 million. So a 5 percent pullback in the market is $5 million in lost capital, even on paper, for these clients.

Q: Where does Hawthorn have clients?

A:

. . . A big component is centered on Pittsburgh, Philadelphia and Baltimore. But we have well over $2 billion in clients' assets that are somewhere between Santa Barbara and San Diego on the West Coast. We have clients in Seattle. As I like to refer to it, Hawthorn seems to exist from Seattle to San Diego and Boston to Boca Raton. And we don't have a lot in the middle of the country.

Q:

How does the money-management business in the Philadelphia region compare with other parts of the country?

A:

Philadelphia is every bit as competitive, perhaps even more competitive, than any of the markets that I can think of. But in true Philadelphia style, it's more of a quiet competitiveness. . . . You can't turn around without bumping into a competitor.

Q:

How do you get new customers?

A:

. . . Really, it's a person-to-person, word-of-mouth business. Your business grows if, and only if, you do a good job for your existing clients. That's the total key to success. . . . Wealthy people tend to be around wealthy people. And so, if you're doing a very good job, odds are that will get out. . . .

But we've also had the situation where a client walks into the [PNC] bank, literally, this is a true story, with a multi-multimillion-dollar check and wants to deposit it at the branch. And the branch says: "Happy to deposit it, put it in your checking account. But maybe you ought to talk to somebody else within PNC."

Q:

What's it like as the son of two schoolteachers to deal with fabulously wealthy people?

A:

. . . I learned the value of a dollar. So growing up in Cleveland, with two parents that would tell you that they didn't have two nickels to rub together for most of their life, it was always clear to us that money wasn't the endgame, that it was about accomplishment. . . .

Fabulously wealthy people . . . are most concerned about instilling a sense of values in their children. They don't want their children to get off track. They want their kids to be positive, contributing members of society. And they're very aware of the fact that wealth can be an obstacle to that.

Q:

Have you ever gone really far out of your way to serve a customer?

A: . . . We had a client just last summer who was traveling overseas, actually happened to be in France. And for a variety of reasons that I won't go into, needed currency, and wasn't able to access currency.

And so our best story is actually putting somebody on a plane with euros to fly overnight to deliver before this guy left the next morning. . . .

Literally the person landed at the airport, took a cab to the hotel, knocked on the guy's suite, handed him an envelope of money, had a cup of coffee with him, and turned around the next day and came back.

. . . You know, the 1 a.m. phone call that says: "Hey, I don't know who else to talk to, but you know more about my family than anybody else. And I just wanna bounce this off of you." It sounds crazy. It's happened. My wife's not thrilled about it when it happens, but it has happened.

Q:

What's your favorite, and least favorite, part of your job?

A:

I would say the favorite part of my job is getting to know people on a very intimate level - people that I deal with today that I read about in newspapers and magazines growing up.

[And] the fact that, actually, what I have to say matters, is extraordinary. And I don't think that's a thrill that you ever get over.

. . . The thing I like least about my job is it's never done. Every year . . . we have the conversation around my kitchen table. "Is this the year you're going to hire somebody, a lawn service, to cut your grass?" And every year I say to my wife: "No." . . .

I said, "Honey, you don't understand that the satisfaction of actually pulling that string, starting up the engine, and being able to look behind me as I walk through the grass and see that what was once long is now short, and then sweep up and put away, and you start and finish something, it's a piece of satisfaction that we never get in this profession."

You work very hard to find a new client. You bring that client in. And then your work starts. And it doesn't stop, ever. You're never done.

Even if they die. I mean the only time our work is ever really done is if a client fires us. And trust me, that's not the kind of satisfaction I'm looking for in my job.

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