st James's Place, originally founded in 1992 by industry stalwarts Sir Mark Weinberg and Mike Wilson, now has £13.5bn assets under management and is going from strength to strength.

Recently announced business figures demonstrate rapid growth continues. New business figures released for the first quarter of 2006 show growth in the pension and investment business is up by 71% and 55% respectively. Weinberg and Wilson remain very much involved with the company, as president and chairman respectively.

Mark Lund, chief executive at St.James's Place (SJP), says although the company, which is 60% owned by HBOS, is listed in the life assurance sectors alongside Prudential and Aviva, SJP is vastly different on many fronts.

Not only is it a life company that had the foresight to avoid offering with-profits funds or guaranteed annuity options, its major business focus is wealth management. Meanwhile, the way in which funds are manufactured and distributed is also unique.

On the distribution front, a team that currently consists of 1,148 self-employed financial advisers, known as the "partners" offers SJP's wares as part of their solutions to client needs. And while the group manufactures all of its own funds, management of these is outsourced to individuals at various investment management companies.

Distribution

SJP products are sold exclusively, by its network of partners, all of whom are self-employed. These partners are located throughout the UK, and having established their own businesses tend to remain with the SJP Partnership over the longer term. In many cases, partners bring their own existing client bases to SJP when joining the group.

"The partners are integral to what we do. They are an exceptionally important group of stakeholders, but are distinctive from employees because they are not employed. Rather, they are businesses and entrepreneurs, sole traders in their own right," says Lund, who joined SJP from Hendersons in January 2004.

He adds an edge SJP has relative to its competitors is the type of client relationship that it can offer. At SJP, most of the partners, having established their own businesses, tend to stay put. Typically, the client will have a relationship with the adviser over the longer term, provided some fairly crucial factors apply, like the adviser remains healthy.

Lund adds that high standards are paramount and the group is very particular about who it will allow to be a partner. Consequently, the average age of partners is 47, and there is 16 years average experience across the group. The clientele seem pleased with this arrangement. As much as 97% of assets by value are retained by the group, indicating the high level of stability.

exclusivity

Partners have an exclusive relationship with SJP on two fronts. Lund says: "We won't make available any of our manufactured products through any distribution channel other than our partners.

"For example, everybody's funds are available on Fidelity's FundsNetwork, but ours are not. That's quite deliberate. It's not that we don't like FundsNetwork, but for us advice comes first and the products are the solutions to whatever the client needs, whether pension, IHT mitigation or just straight forward investment."

The other side of that exclusivity arrangement is that the members of the partnership can't advise on other company's funds. However, because SJP outsourced to strong managers who have delivered leading performance, he says clients are not disadvantaged by this arrangement.

SJP targets the mass affluent rather than the mass market. But unlike most its rival wealth managers, SJP does not set a minimum investible asset level at which it accepts clients.

Rather, Lund adds, it is up to the individual partner to determine the economic viability of each client. The rationale is that the partners are self employed so it is up to them how they spend their time.

While the partner will hold the key relationship with the client, SJP remains very much involved. Lund says in financial services there is often the highly sensitive issue of who owns the client, whether the company or the adviser. "We very much believe our partners have the main relationship with the clients, but that doesn't allow us to distance ourselves," he says.

The London-based corporate office of SJP is located in Spencer House, in St James's Place, in Mayfair, London. Head office is based in Cirencester in Gloucestershire, where functions such as finance, marketing, product development and human resources are located.

Additionally, throughout the UK, including Aberdeen, Edinburgh, Belfast, Glasgow, Birmingham, Leeds and Bristol, there are other bases known as locations. A "head of location" is appointed to each of these offices, and has a management team which reports in to them. The head of location has three key roles.

The first is to find new members of the partnership through recruitment. Second, is helping partners to develop and grow their businesses. The third function, meanwhile, is all of the risk monitoring, compliance and regulatory work that supports the individual partners.

Each of the 1,148 partners is then attached to a location. Approximately 60% have their offices physically based in one of the SJP locations. The remaining 40% of partners have their own offices.

"SJP provides everything they need to advise their clients, for example all the materials, brochures and products and data if they are trying to organise a particular seminar. In that sense, it is SJP's goal to ensure we are in the best place possible for them to do business. If we continue doing that, we will continue being as successful as we have been," Lund adds.

Growth

There are two key drivers for increasing growth in new business

The first is increasing productivity from the existing group of advisers. Lund says during 2005 there was a 25% increase in new business, which was productivity driven. This was above the target 15-20% per annum over the longer term (ie five years or so).

The second driver is boosting the capacity to advise, which means increasing the number of advisers. While SJP is always looking for new recruits, it is somewhat restricted because of its high standards in terms of experience and calibre.

Lund says by far the main way in which new clients come to join SJP is through word of mouth. However, the group also proactively targets clients and a main way it does this is through holding seminars. Through access to data, the SJP partner will write to relevant people in their catchment area and invite them to a topical seminar. An area of particular interest currently is inheritance tax planning.

Lund adds that with 1,148 advisers, there are 1,148 variations of a business model. He adds: "Like any other business, there is a market each partner can identify. Some are generalist advisers and they advise across the board. Many are specialist advisers – for instance they may specialise in tax and trusts or in pension advice.

Similarly, the clientele that partners target will likely vary along many parameters. A partner may specialise in targeting professionals of a particular career, for example medical professionals. They may take a geographic segment like Wales or Cheshire. Or they may boil it down to specific postcodes that they are targeting in a bid to find and acquire new clients.

Products

Lund is the first to admit that SJP will not usually be first to the market with leading edge products.

"We don't feel great pressure to be product innovators. That's not what our clients want. In a sense, we would rather let our competitors lead, and we will follow," he says.

"Through a combination of good judgement and good luck, SJP managed to steer clear of some of the so-called best idea funds that went on to severely damage client wealth and the reputation of the industry. We resisted the temptation to jump on the band wagon when others were launching technology or biotech funds. We've managed to weave our way around things that have caused immense amounts of damage to clients' personal wealth and reputational damage for the industry. That is an approach that we will continue going forward. We plan to remain quite conservative in that respect."

That said, SJP does offer new products where it has identified a genuine need. At the start of the year it launched a high interest cash bond. Minimum subscription is £100,000. And only last month it launched a portfolio service of Aim shares, the objective being to mitigate inheritance tax. This is outsourced to Close Brothers. wealth

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