by John Jephson, Partner & Co-Founder, Clairmont Trust Company
Inception and Founding Principles
A decade ago, my partners and I left the security of large private banks to launch Clairmont Trust Company in The Bahamas, driven by the desire to offer more personalized fiduciary services. Our mission was clear: build strong relationships with clients, offering fast, accessible, and accountable service to ultra-high-net-worth (UHNW) families. We realized large institutions often lacked this personal touch, and we sought to bring it back.
Today, Clairmont Trust Company has expanded beyond The Bahamas, establishing offices in Jackson, Wyoming, and Geneva, Switzerland, alongside representative offices in Miami and London. We’ve grown into a full-service family office, supporting the increasingly global needs of our clients. Despite the industry’s challenges, our core principles remain unchanged: nurturing close client relationships, delivering personalized service, and prioritizing our people.
Building Trust and Reputation
In the trust business, reputation is everything. When we left the large banks, we no longer had the backing of a well-known brand, so we had to build trust from scratch. Fortunately, with over 25 years of experience each, we had strong foundations. Many families and advisors we had worked with were willing to follow us to our new venture.
Our reputation-building process evolved in three stages. Initially, we relied on relationships with long-time clients, which provided the groundwork for growth. In the second phase, we attracted new families through our network of lawyers and advisors, who valued our boutique firm’s ability to offer a more specialized, conflict-free service compared to larger institutions.
Now in our third phase of growth, we’ve selectively hired younger partners from top institutions. For example, advisors with deep expertise in Colombia and Mexico have helped expand our reach and market expertise, keeping us focused on personal relationships while diversifying our team. This measured approach has allowed us to grow without sacrificing our client-focused culture.
The Changing Industry: Opportunities for Boutiques
The trust industry has changed significantly in the past decade, with increased regulatory demands, IT security concerns, and the rise of digital processes. However, perhaps the most notable shift has been the retreat of private banks from fiduciary services, as exemplified by Citibank’s recent sale of its entire trust business.
This has opened doors for boutique firms like ours, who can focus on fiduciary duties without conflicts of interest. We complement, rather than compete with, private banks. Lawyers appreciate our independence, knowing we can implement their clients’ trust structures without conflicts that arise when trustees also manage investments.
Private equity (PE) ownership has further altered the landscape. Initially, PE capital fueled rapid expansion in the industry. But as these firms approach the end of their investment cycles, the emphasis has shifted from service to profitability, leading to reduced client visits and declining service quality. For independent, owner-managed firms like Clairmont, this shift presents an opportunity to differentiate ourselves by continuing to prioritize long-term relationships and personal service.
Growth and Staying Close to Clients
As our clients have become more global, so have we. Our representative offices in the U.S. and Europe help us stay close to families spread across different countries. Today’s UHNW families often have members running businesses in one country, with others working or studying abroad. To effectively serve them, we’ve expanded geographically while remaining nimble and focused on proactive, personal service.
For us, growth has never been just about adding jurisdictions; it’s about deepening relationships with our family clients. One instance that stands out was a lengthy conversation at dinner with a client years ago that revealed potential U.S. estate tax issues. The issue only came to light when the client casually mentioned that his son, who was headed to college in the U.S., held a U.S. passport. This level of nuance is often overlooked by larger institutions, but it’s crucial in providing the best advice and service.
Challenges and Lessons Learned
The trust industry is becoming more complex, with regulatory challenges that can be costly. UHNW families require personalized attention, but this can only be achieved by thoroughly understanding their unique circumstances and the local regulations that affect them. Building a wide network of professionals takes time but is critical for providing expert advice.
Internally, growth has also required us to improve communication within our expanding team. While technology has helped, much like with our clients, we believe personal proximity is essential within the workplace too. Maintaining our cohesive culture across jurisdictions is an ongoing challenge we’re committed to meeting.
Hiring the right talent has also been essential. Beyond the founding team, our firm’s success depends on finding individuals with the right skills and values, who are eager to work closely with UHNW families and fit our culture.
Looking Ahead
Ten years marks an exciting milestone. As we look to the future, the core of our business will continue to revolve around personal relationships, even as technology and regulations evolve. While artificial intelligence and automation may streamline certain processes, human interaction remains irreplaceable. Listening to a family’s concerns over a late-night conversation, understanding their needs, and tailoring our solutions accordingly will always be at the heart of what we do.
What excites us most about the next decade is the opportunity to keep growing alongside our clients, offering them the personalized attention they need in an increasingly complex world. And when solving problems requires jumping on a plane to visit a client, we’ll be ready.
