I had the pleasure of interviewing Carter Henderson, the 23-year old founder behind Henderson Capital Group. His firm offers investment management services and handles separately managed accounts for individuals/small businesses, institutions, and financial advisors. Since he started Henderson Capital group, Carter has grown the business 20x and has seen some of his investment ideas published in Forbes, Jim Cramer’s The Street, and Barron’s.
Jean: Thank you so much for doing this with us! What is your “backstory” of how you became a founder?
Every investor who runs their own company always has a story of how they got hooked to the stock market at a young age — I am no different. I bought my first stock — Coventry Healthcare — when I was 12-years old. I made a measly $20 profit, but at the time it felt like a million dollars to me and I knew I was hooked to investing from then on.
Fast forward to now, I had two previous positions in the asset management industry and I took everything in like a sponge. I knew I had the capability to start something on my own and could create a real competitive advantage for myself. What started as a side hobby with one account while I was in college and playing football grew into a full-time business with over 30 accounts today. I just have a great interest in helping people realize the benefits of investing — I don’t think many people get how beneficial it can be because of the lack of education if you don’t have an investment background.
Jean: What do you think makes your company stand out? Can you share a story?
In this industry you can be the best portfolio manager and pick the best stocks but unless you make a real connection with your clients you will never succeed. It is all about getting your clients to trust you and feel comfortable doing business with your firm. I like to work with people and can make meaningful, long lasting relationships which gives me an edge. I also believe my competitive advantage comes from not having to push an agenda from a larger financial institution that backs most financial advisors. Meaning I never sell financial products that lock you in for years, have lofty commissions that allow advisors to benefit more, and fees that are unnecessary for the average investor. Furthermore, clients of mine get to work with the person who makes the direct decisions in their portfolios — with most larger firms you are working with a front-end sales person who doesn’t have the ability to do so.
I believe being a founder in my twenties puts me at a great advantage. I have more energy to push through long projects and to put more hours into the business. Moreover, I have less responsibilities than some older founders do. What I mean is I haven’t started my own family yet which gives me more flexibility to do what must be done for the business — but I do have a great fiancé and family who supports me when times get tough. Lastly, in this industry, people want to work with managers who will be working well into their own retirement years. Being young allows me to grow the relationship and ensure clients that they will not have to change advisors at such a crucial time because I will be in this business for decades to come.
Jean: Are you working on any exciting projects now?
Yes, we are. A big shift is happening and there is a new investing theme people are wanting to be a part of and it is called ESG investing. ESG stands for Environmental, Social, Governance and more investors want to buy stocks in companies who align with their principles and values. ESG gives them this opportunity — buying companies who are conscious about the environment or their resources, create diversity in the workplace, or whose governance is regularly critiqued. Millennials are going to be inheriting some $30 trillion over the next few decades and their investing style ties closely to how companies impact the world around them. Being a millennial money manager puts me at an advantage to better connect with their way of thinking. We have built numerous portfolios to offer this growing group of investors — they include portfolios for battling cancer, socially responsible, water shortage, clean energy, and more.
Jean: Do you have a favorite book that made a deep impact on your life? Can you share a story?
I would say it was Ray Dalio’s book he released last year called Principles. He has a similar story — Ray started his own hedge fund at the age of 26 from his two-bedroom apartment and grew it into the largest in the world. The book talks mostly about the work and life principle he used to guide him through every decision at his company. He also recalls how he made some serious mistakes at a young age and had to fire everyone at his company because he lost so much business. Learning from your failures and the failures of others can help you progress so much further then you could ever imagine. One of the principles Ray uses that I have implemented into my own company is surrounding yourself with people of different thinking to get multiple points of view and constructive criticism — this has helped grow my business tremendously. I have worked hard to grow relationships with some of the best investors and businessman in my city and the world. They have become like a board of advisors — helping me understand what I don’t know yet.
Jean: What are your “5 Lessons I Learned as a Twentysomething Founder” and why? Please share a story or example for each.
1. Fail early and fail often- The best lessons are learned from your failures not your successes. When you’ve hit the bottom, there is only one to go from there and that’s to pick yourself up and try again. Especially at this age, your back is against the way every day and you have no choice but to succeed — the stakes are too high. In any business you create you have to be willing to hear the words no because you’re going to get a lot of them. I hear those words all the time but you can’t let that phase you — put it behind you and move on to the next answer of no because each no gets you closer to that one yes. And that one yes could be the biggest break for your company yet.
2. Surround yourself with people smarter than you- This has been one of my main focuses since reading Ray Dalio’s book Principles. You have to work to find the opportunity to put yourself in a situation where you can be seen by some of the smartest people around you. Sometimes it takes luck but most of the time it takes persistence. I have been lucky to surround myself with some brilliant people who have a genuine interest in helping me. My persistent (or luck) has gotten me face-to-face meetings with the best money manager in my city. I have also had the opportunity to personally talk and learn from some of the largest hedge fund players — Ray Dalio and David Einhorn among them.
3. To get where you want to go, you have to know where you’ve been- As a founder, you will be alone at first and there are no simple directions to get you exactly where you want to go. You have to look back and ask yourself what worked and what didn’t — if something isn’t working then forge a new path until you find that success. I look back every day and see how far the business has come — that drives my internal motivation. It’s the little successes you have that keep pushing you forward.
4. There’s no substitute for hard work- There’s no magic formula that will lead you to the top of your respected industry. You have to earn every forward step you take — the only way to accomplish that is through hard work. Being an athlete has instilled that work ethic and that competitiveness in me. Also, I believe the harder you work, the luckier you become.
5. Take time for yourself and be patient- When you first start running a company, things are going to be hectic — everything will seem to be moving extremely fast. Most of the time you will work well into the night and on the weekends. Even when you’re not doing physical work, your mind will be thinking about the business 24/7 — it will consume you if you let it. Take time for yourself to do what you love and to relax your mind — I take to hobbies like golf, reading, and being together with family, friends, and my fiancé with our dog. I am also a big advocate on exercising your mind through meditation. Lastly, be patient in the process — don’t let all the little achievements pass you by because you are waiting for that big success. Just enjoy every step of the process and have fun with it.
Jean: Some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this. 🙂
It would either be Warren Buffett or Elon Musk. Buffett was really my first role model in this business and I know he would have a wealth of knowledge to share with me — he’s one of the greatest investors to ever do it.
Elon Musk is like the Einstein of our generation — he’s doing electric cars, trying to colonize space, and really whatever he finds inspiration in. I think just sitting down with Musk and getting to hear his ideas of the future would be an exhilarating experience.
— Published on July 19, 2018
Originally published at medium.com