Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, September 22, 1995 TAG: 9509220081
SECTION: BUSINESS PAGE: A9 EDITION: METRO
SOURCE: MAG POFF STAFF WRITER
DATELINE: LENGTH: Medium
The president of Davenport & Co. expects its new Roanoke office to "move along slowly" as it grows from five brokers to the firm's typical branch of 10 to 14 professionals.
Coleman Wortham III came from the main office in Richmond to Roanoke on Thursday to call on local clients. He concentrated during on community banks that are interested in a cooperative venture of selling securities in competition with larger financial institutions.
Davenport entered the Roanoke market July 5 when it bought the business of Ferguson, Andrews & Associates.
The company plans to refurbish its quarters at the old Liberty Trust Building, starting shortly after an Oct. 19 open house. It will create 11 private offices. When they are filled, Wortham said, more space is available on the mezzanine.
But he pointed out that it took the Virginia Beach office five years to reach the level of 10 to 14 brokers.
Wortham conceded that Roanoke is a town with a lot of security brokers, but he's not afraid of the competition. "It tells you there's a lot of business here."
The business, he said, is supported by the wide region of Southwest Virginia that Roanoke serves as well as by the valley.
Wortham is confident of growth because "brokers and customers like the way we do business." He said that is the the old-fashioned way, never hurried, doing things right and putting the customer first. Brokers like to work for a Virginia firm, he said, and Davenport has state offerings such as a wide collection of Virginia municipal bonds.
Davenport & Co. was founded in 1863 in Richmond. Wortham's family has been associated with the firm since it was established, although it's not a family firm.
The company had that one office until 1981 when it opened a branch in Virginia Beach and three years later in Charlottesville.
In 1989, Wortham said, Davenport had those three offices, 99 employees and revenues of $11 million. Today, in the drive for a statewide presence, the firm has 12 offices in Virginia, 254 employees and revenues of $30 million.
Wortham said Davenport wanted to enter the Roanoke market sooner or later, but it was looking for the right timetable. You don't just walk in and start hiring brokers one at a time, he explained.
So the company took the opportunity of buying the Roanoke and Lynchburg offices of Ferguson, Andrews when they came on the market this summer, Wortham said. In Roanoke, the company acquired a working office and five brokers with an established clientele.
The Roanoke purchase made sense, he said, especially because it was the gateway to "all the rest of Southwest Virginia to go shopping in." He has no plans to open elsewhere in the region such as Bristol, but "I'm opportunistic" and rules nothing out.
All prior offices were within two hours of Richmond, he noted. The Roanoke purchase expands the perimeter to more than three hours so it's a major step for the company.
The brokerage business is changing, Wortham said, and many observers expect banks to drive small regional companies out of the picture. But 15 years ago, he said, people predicted that the large national firms would push the smaller ones out of business. Obviously that hasn't happened.
Many people think it looks easy, but brokerage is a hard business, he said. "You risk your entire net worth every day."
Wortham explained that Davenport has capital of $15 million put there by the employees. If something should go wrong, the customers would be paid before the employees received a cent.
"It makes you watch the basket very closely," Wortham said. "It makes you be more careful."
by CNB