Peer Counseling for Multimillionaires: Ex-Magnates Share Angst, Stock Tips

August 7, 2003

THURSDAY, AUGUST 7, 2003

Moving On / By Jeffrey Zaslow

Peer Counseling for Multimillionaires: Ex-Magnates Share Angst, Stock Tips

ONE 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 he
bared his soul.

The 58-year-old retiree passed out charts
detailing his assets in real estate, stocks, artwork
and a charitable fund. After that, he got very
serious. Until October 2001, he was vice chair-
man for CIBC World Markets, overseeing $800
million in customer equity positions. But his
office was near the World Trade Center, and
the 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 he
did so with a rich golden parachute.

Part of him is thrilled he’s no longer trapped
in the markets. “I don’t want to sit around
thinking about who will benefit because the
Challenger blew up. I thought that way for
40 years,” he said. Still, adjusting to life with-
out a job has him fighting “a certain level of
depression,” he admitted.

The other men, ages 47 to 68, listened
knowingly. They, too, made their fortunes
and left their jobs. They’re now members of a
confidential “peer-to-peer learning group” called
Tiger 21, which stands for The Investment
Group for Exceptional Returns in the 21st
Century. Entry to the four-year-old group
requires an investable net worth of $10 million
to $100 million—and a willingness to pay
annual dues of $20,000, which cover expenses
for 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 are
former CEOs or entrepreneurs who’ve sold their
companies and now bounce investment ideas
off each other. But at their monthly meetings,
the dialogue is very personal. ‘High-net-worth
people sign up for Tiger 21, but human beings
show up,” says Richard Lavin, a founding part-
ner and the group’s organizer.

Investment professionals say Tiger 21 is a
rarity: an investment club for the wealthy
where peers are privy to each other’s portfolios
and personal demons. Members turn to each
other to share emotional issues related to their
families, their fears, their mortality. That’s why
I asked to spend a day observing a meeting.
But I arrived wondering: Why can’t these guys
just talk things out with their friends? Why do
they need agendas, hefty dues, and rules for
accepting and rejecting new members?

Some members admitted that their spouses
were at first dubious about Tiger 21. But they
explained that the structured program helps
build trust, and that insights they receive here
more than cover the price of admission. Just
last month, several members made millions of
dollars when drug giant Roche Holding AG
agreed to buy Igen International Inc.; Tiger
members had long touted Igen to each other.

On personal issues, members say, Tiger can
be equally rewarding. At the Carlyle meeting,
they talked of the challenges of raising rich
children. One member didn’t want to take his
daughter on a promised shopping adventure:
“I’ve just seen her grades.” Another member
said that in one way, he envies poor people—
because they don’t always see the limitations of
wealth: “They think they’ll be happier rich.”

Not all members were gut-spillers, but most
seemed to be empathetic listeners. Mr. Gallagher
said Tiger helps him realize he’s not the only
guy with issues: “Eli Lilly doesn’t make Prozac
just for me.”

Some Tiger members were leery of allowing
an outsider to observe them, and didn’t attend
that day. But those I met included Tiger co-
founder Michael Sonnenfeldt, who made his
fortune in real estate; Stanley Katz, founder of
Archer Management Services, a pioneer in
office support outsourcing; and Richard Block,
who once headed AGI Inc., a manufacturer of
record album jackets that branched into pack-
aging for CDs and other products.

The morning began with each member
giving an “update.” Mr. Block said he’s happily
investing in a company that makes railroad
ties out of recycled plastic. Then he added that
he’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’re
upside down?” another member asked, and
everyone laughed.

The men welcome the candidness at Tiger,
and the chance to learn. Each month, they invite
speakers ranging from economists to therapists
discussing the family dynamics of affluence.

On this day, a “wealth management” expert gave
advice on outlining investment goals.

The veteran retired millionaires of Tiger
advise the newcomers on preserving their
wealth, by word and example. (Indeed, one
fiscally careful member, the former CEO of
a major food brand, came to this meeting on
a city bus.)

Tiger members also help each other under-
stand their emotional relationship with their
wealth. At the members’ lunch, one said:
“I spend more time thinking about sex than
money, but I spend more time ‘doing’ money.”

A day inside Tiger offered new insights into
the transitions that often follow success. Part
of me agreed with a member’s wife, who point-
ed out that she shares her intimate thoughts
with close friends and it costs her zero. Perhaps
women are better at that, the men of Tiger
admitted. But I did see benefits in organizing
a gathering of smart, successful people, all at
similar spots on the timeline, and inviting them
to counsel each other.

Group organizers would like to expand the
Tiger concept to places like Palm Beach, Fla.;
Los Angeles; and Chicago. Plenty of wealth
there, plenty to talk about.

If you are interested in learning more about TIGER 21, please complete the contact form and you will receive a copy of our most recent Asset Allocation Report.