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June 9, 2014

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24 November 2010 | International Herald Tribune | BY FRAN HAWTHORNELoaded with cash and full of dreadSupport groups spread across U. S. to assist people who have it allBesides finance, meetings cover health, vacations, philanthropy and, most of all, the children.In 2003, Mark Kress was having money troubles.He had amassed an eight-figure fortune from products andprograms he sold through the television shopping networkQVC and from Spencer Forrest, a maker of treatments forthinning hair that he founded in 1981.His problem, he said, was that “I had issues surroundingwealth, many of which I couldn’t discuss even with my bestfriends,” adding: “If I turned to a friend and said, ‚ÄòI have Xdollars but I don’t feel like I have enough,’my friend mightconsider it bragging.”Mr. Kress wanted “to get a better understanding of theprinciples of investing and be exposed to investmentopportunities.”Then he read a news article about something called Tiger 21,which stands for The Investment Group for Enhanced Returnsin the 21st Century.Tiger 21 is for the person who has everything, exceptsomeone to discuss it with. At day-long meetings each monthin six United States cities, about a dozen superwealthy peopleat each location ponder their money, how to manage it, how togive it away and the personal problems this creates.”We all learn from each other. That’s the magic of thisplace,” said Ronald Bruder, a member of one of the sevenNew York City groups and a serial entrepreneur who hasstarted or revamped companies specializing in real estate,environmental engineering, oil drilling, medical devices andtravel.The organization was co-founded in 1999 by MichaelSonnenfeldt, a New York City entrepreneur who had sold hisreal estate business and wanted to invest the proceeds “in aresponsible and effective way.” He modeled his creation aftera peer-to-peer learning group of chief executives to which hehad belonged. Five more chapters are expected to start by nextyear, with three others on the drawing boards.Membership is selective. Originally, people needed at least$10 million in investable assets. Mr. Sonnenfeldt said therewas no longer an official minimum, but he pointed out that the140 members collectively had $10 billion and they had to beable to afford the $30,000 annual fee.”They have to have been a wealth creator or a goodsteward,”said Harley Frank, the director of membership, oneof eight full-time employees. If they inherited a fortune orwon the lottery, they must have built on that base. That was apparently the case with Gregory T. Rogers, whobegan his career in the 1980s at Rogerscasey, the investmentconsulting firm started by his father. The younger Mr. Rogerspointed out that he had left Rogerscasey and founded or co-founded three asset management and consulting businessesbefore joining Tiger in 2005. early two-thirds of Tiger members are entrepreneurs.In rare cases, Mr. Sonnenfeldt said, “someone with deepexperience in a field like politics or science or philanthropy”might get in with a slightly skimpier cash cushion.Prospects are screened by Mr. Frank and other staff membersand by the leader of the local group. Applicants then attend ameeting for a few hours, on a trial basis. Perhaps the toughestpart is that “they have to check their ego at the door,” asmembers repeatedly say.While Tigers applicants need not be referred by members,it helps. Only about 40 percent of the applicants are accepted.According to Mr. Sonnenfeldt, almost 10 percent are womenand 5 to 10 percent are members of minority groups. Agesrange from the 30s to the 80s, with an average in the 50s.True to the full name, the meetings focus on finance. Peoplebring up investment ideas, and money managers pitch theirproducts. The highlight is the “portfolio defense,” a one-hourgrilling during which a member analyzes his holdings almostto the penny. The frankness is not easy. “It’s like going in frontof a doctor and baring all,”Mr. Bruder said. During his firsttime up, he was challenged about his conservative approach,including a heavy allocation to fixed income.”I didn’t feel attacked,” he said. “They’re asking ‚Äòwhy’ butthey’re supportive.” Anyway, he added, everyone will be inthe hot seat at some point.Although he did not drastically change his investmentstrategy, Mr. Bruder said he had picked up valuable advicefrom the discussions. Thanks to Tiger, he now has a “serious”portion of assets in foreign currencies.Similarly, Mr. Sonnenfeldt was inspired to invest in gold,and Mr. Rogers increased his spending on marketing for oneof his companies, Raylor Investments, which manages about$25 million of his own and outside money.Finance covers only about two-thirds of the meetings.During the opening hour or two, when each member gets fiveminutes for a “world update, “personal issues are as likely tobe updated as portfolios – divorces, aging parents, healthissues, home projects, vacations, philanthropy and, most ofall, the children.The No. 1 subject: “What’s an appropriate amount to give?How do you enable your children to maintain the values youconsider important and also let them live the lifestyle you’reaccustomed to?” Mr. Bruder said. n his case, he said, his Tiger group “helped me makedecisions about what to fund and not fund” when his growndaughter wanted to start some business ventures.Many participants are now putting into charitable venturesthe energy, time and networking resources they once devoted tomaking money. In 2004, Mr. Bruder started the Education forEmployment Foundation, which works with local businessesand governments in the Middle East and North Africa to createtraining programs.The outside speakers who come to every meeting haveincluded hedge fund managers, the television celebrity Dr.Mehmet Oz and the actor Robert Duvall, who was pitchinga movie venture to the Los Angeles group, according to Mr.Kress.The meetings are led by a professional facilitator who usuallycalls on people to speak. Typically, they sit around a table inthe conference room of a four-or five-star hotel, continuingthrough breakfast and lunch.Members have been known to cry or even hug. But, Mr.Bruder emphasized, “It doesn’t get all that emotional. Thefacilitator moves it along quickly.”The bonds can grow into friendships. Members have traveledtogether and even bought homes next door to each other.Not everyone fits in. “We have counseled out two or threemembers for behavior inconsistent with the norms,” like beingdisruptive or threatening to break the promise of confidentiality,Mr. Sonnenfeldt said.The most serious – but rare – grumbling comes from thosewho “have very unrealistic expectations,” Mr. Sonnenfeldtsaid. “They think they’re going to earn twice as much moneyin the first six months.”The organization is growing. By next year it expects to havebranches in four Canadian cities and in Washington. Furtheroff are plans for Chicago and a second group in both LosAngeles and Texas.That might seem like a sign that the economy is improving,but Mr. Sonnenfeldt said it was just the opposite.During the economic downturn, “high-net-worth individualswere exposed to risks that they found they didn’t understand,”he said. “They’re feeling adrift, and they’re looking forresearch.”