PEER COUNSELING FOR MULTIMILLIONAIRES: EX-MAGNATES SHARE ANGST

THURSDAY, AUGUST 7, 2003Moving On / By Jeffrey ZaslowPeer Counseling for Multimillionaires: Ex-Magnates Share Angst, Stock TipsONE RECENT MORNING in a small meeting room at New York’s Carlyle Hotel,Thomas Gallagher stood before six fellow mil-lionaires. First he bared his portfolio. Then hebared his soul.The 58-year-old retiree passed out chartsdetailing his assets in real estate, stocks, artworkand a charitable fund. After that, he got veryserious. Until October 2001, he was vice chair-man for CIBC World Markets, overseeing $800million in customer equity positions. But hisoffice was near the World Trade Center, andthe stress of the Sept. 11 attacks rendered him”unstable” at times, he said. He and the com-pany thought it best for him to leave, and hedid so with a rich golden parachute.Part of him is thrilled he’s no longer trappedin the markets. “I don’t want to sit aroundthinking about who will benefit because theChallenger blew up. I thought that way for40 years,” he said. Still, adjusting to life with-out a job has him fighting “a certain level ofdepression,” he admitted.The other men, ages 47 to 68, listenedknowingly. They, too, made their fortunesand left their jobs. They’re now members of aconfidential “peer-to-peer learning group” calledTiger 21, which stands for The InvestmentGroup for Exceptional Returns in the 21stCentury. Entry to the four-year-old grouprequires an investable net worth of $10 millionto $100 million-and a willingness to payannual dues of $20,000, which cover expensesfor meeting-room rentals, meals, speakers’ fees,and the services of a paid organizer and dis-cussion leader.The 16 men and one woman of Tiger areformer CEOs or entrepreneurs who’ve sold theircompanies and now bounce investment ideasoff each other. But at their monthly meetings,the dialogue is very personal. ‚ÄòHigh-net-worthpeople sign up for Tiger 21, but human beingsshow up,” says Richard Lavin, a founding part-ner and the group’s organizer.Investment professionals say Tiger 21 is ararity: an investment club for the wealthywhere peers are privy to each other’s portfoliosand personal demons. Members turn to eachother to share emotional issues related to theirfamilies, their fears, their mortality. That’s whyI asked to spend a day observing a meeting.But I arrived wondering: Why can’t these guysjust talk things out with their friends? Why dothey need agendas, hefty dues, and rules foraccepting and rejecting new members?Some members admitted that their spouseswere at first dubious about Tiger 21. But theyexplained that the structured program helpsbuild trust, and that insights they receive heremore than cover the price of admission. Justlast month, several members made millions ofdollars when drug giant Roche Holding AGagreed to buy Igen International Inc.; Tigermembers had long touted Igen to each other.On personal issues, members say, Tiger canbe equally rewarding. At the Carlyle meeting,they talked of the challenges of raising richchildren. One member didn’t want to take hisdaughter on a promised shopping adventure:”I’ve just seen her grades.” Another membersaid that in one way, he envies poor people-because they don’t always see the limitations ofwealth: “They think they’ll be happier rich.”Not all members were gut-spillers, but mostseemed to be empathetic listeners. Mr. Gallaghersaid Tiger helps him realize he’s not the onlyguy with issues: “Eli Lilly doesn’t make Prozacjust for me.”Some Tiger members were leery of allowingan outsider to observe them, and didn’t attendthat day. But those I met included Tiger co-founder Michael Sonnenfeldt, who made hisfortune in real estate; Stanley Katz, founder ofArcher Management Services, a pioneer inoffice support outsourcing; and Richard Block,who once headed AGI Inc., a manufacturer ofrecord album jackets that branched into pack-aging for CDs and other products.The morning began with each membergiving an “update.” Mr. Block said he’s happilyinvesting in a company that makes railroadties out of recycled plastic. Then he added thathe’s taking yoga classes from his daughter.”It’s great to be my child’s student,” he said. “Does she empty your pockets when you’reupside down?” another member asked, andeveryone laughed.The men welcome the candidness at Tiger,and the chance to learn. Each month, they invitespeakers ranging from economists to therapistsdiscussing the family dynamics of affluence.On this day, a “wealth management” expert gaveadvice on outlining investment goals.The veteran retired millionaires of Tigeradvise the newcomers on preserving theirwealth, by word and example. (Indeed, onefiscally careful member, the former CEO ofa major food brand, came to this meeting ona city bus.)Tiger members also help each other under-stand their emotional relationship with theirwealth. At the members’ lunch, one said:”I spend more time thinking about sex thanmoney, but I spend more time ‚Äòdoing’ money.”A day inside Tiger offered new insights intothe transitions that often follow success. Partof me agreed with a member’s wife, who point-ed out that she shares her intimate thoughtswith close friends and it costs her zero. Perhapswomen are better at that, the men of Tigeradmitted. But I did see benefits in organizinga gathering of smart, successful people, all atsimilar spots on the timeline, and inviting themto counsel each other.Group organizers would like to expand theTiger concept to places like Palm Beach, Fla.;Los Angeles; and Chicago. Plenty of wealththere, plenty to talk about.