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Small investment firm taps into Virginia market

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Posted: Sunday, February 16, 2014 6:45 pm

CHARLOTTESVILLE — Eric Kallen and Court Nexsen are among a growing group of experienced finance professionals who have worked at marquee firms in big cities but are choosing instead to tap the potential of smaller markets.

Kallen and Nexsen are among five people at Hayek Kallen Investment Management, a Charlottesville-area investment advisory firm. The firm also has an office in Fairhope, Ala.

“What I don’t think is obvious to the community, as it is to us, is there’s a tremendous money management structure in this town,” Kallen said. “We professionally found it to be the perfect place because of the resources that were available.”

Founded in 1985 by Fred Hayek, the firm manages about $240 million for about 200 individuals, families and institutions.

Kallen is the firm’s president and chief investment officer. A graduate of the College of William & Mary and Washington and Lee University, he joined the company in 2002 after working for Morgan Stanley in New York and in London.

Nexsen, a graduate of the University of Virginia’s Darden Graduate School of Business Administration and Washington and Lee, joined the firm last year after working for Goldman Sachs in New York and at Harris Williams & Co. in Richmond.

Despite their experience with some of the industry’s top companies, “We’re a small business, first and foremost,” Kallen said. And as a smaller, closer-knit company, “it gives you a sense of satisfaction,” he said.

Nexsen agreed.

“I wouldn’t have traded my time in New York. Goldman Sachs was 35,000 [employees] but at the same time, there was such internal pressure,” Nexsen said.

Kallen said the company’s smaller size enables a more nimble response to changing markets and more personal attention than a larger firm might be able to deliver.

Clients, said Kallen, “they’re real individuals — they’re not account numbers. We look to have a personal relationship with them; we know them across the organization. ... We have a higher level of accountability. If we’re managing money for people we know personally, I think there’s a higher level of diligence.”

In response to a growing presence of asset managers, Darden launched the Center for Asset Management last year to advance the study and practice of the industry through research, conferences and educational programs.

“There isn’t necessarily a negative experience with Wall Street firms that prompts investment professionals to leave the city as much as the asset management business is very transportable, which creates the opportunity to be more entrepreneurial and work for your own firm or with a few partners,” Ken Eades, the center’s interim academic director, said in an email.

The portability of the industry has attracted other big-city companies to Central Virginia. Investment firm Manchester Capital Management opened a Charlottesville office in 2012.

This fall, Darden is slated to host the seventh annual UVa Investing Conference. The event brings about 400 industry experts from around the world to Charlottesville.

“If you want to start your own hedge fund, you can trade stocks and bonds just as easily in Charlottesville as in NYC,” Eades said. “If you want to start an investment advisory firm, Charlottesville provides a strong demographic for individuals seeking investment advice.”

Eades said he anticipates more local growth in the asset management realm.

“We believe that an investments ‘ecosystem’ is developing in Albemarle County and that more and more professionals in asset management will come to this area to be part of a network that includes academics, as well as practitioners,” Eades said.

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