Targeting 'Treps: New investment firm focuses on area entrepreneurs

Derek Notman, 34, is in an enviable position. His first business, a wealth management firm in St. Albans, Vt., has done so well that it is allowing him to pursue a second opportunity, Steadfast Capital Solutions, LLC, in Madison.

Instead of investors, this time he’s targeting the entrepreneurs who court them.

It’s something that hasn’t been done yet, he reports, but Notman believes entrepreneurs in particular need safe financial guidance. “By definition, they tend to take a lot of risks,” he notes, because they’re often too busy building their businesses to think about caring for their own financial stability. “I work with them from their first prototype or invention all the way up to an exit strategy.”

Notman chose the name Steadfast because it represents strength and stability. “Everything else for an entrepreneur is risky.”

The company has been undergoing a soft launch, but Notman really took the reins in February.

The company logo, a tree, is taken from his family’s Scottish crest, which dates back hundreds of years. In fact, Notman has international roots. He was born in Dublin, Ireland, and holds dual citizenship with the U.S. His mother is from Holland but was raised in South Africa. Notman, whose father earned a degree in Dublin, actually grew up in in the Midwest and graduated with a Bachelor of Arts in anthropology and archeology from the University of Minnesota-Duluth.

He worked as a senior counselor for an at-risk residential treatment center before moving with his wife to Vermont in 2005. He then switched gears, earning several trade designations from The American College of Financial Services, and was named leading new advisor for the State of Vermont in 2007. In 2010, he started the wealth management firm of Notman, Muehl Associates, which he still visits once a month.

“I’m not looking for new clients [in Vermont] anymore,” he says.

An entrepreneur in his own right, Notman chose to move to Madison because of its reputation as an entrepreneurial hotbed.

But why work with entrepreneurs, who often have next to nothing when they start up? Notman says he conducted a national search and was unable to find anyone specializing in the entrepreneurial culture. He’s attracted to their mindset, and he wants to grow with them. “They want to create something to improve society one way or another — a service, a product, an idea — and they’re willing to take risks to do so.”

But they must not overlook other priorities, he cautions.

“Will your family be taken care of if something happens to you? What’s your retirement plan?” As they grow and become more financially stable, their needs will change, he explains, and he intends to handle those changes long term.

“People in my industry tend to come into business trying to work with anyone and everyone. It’s inefficient,” he insists. “Nothing makes you unique, and this is an extremely competitive industry.”

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The success of his Vermont firm is allowing him the time and peace of mind to approach things methodically. “I have more freedom, financially,” he notes. “I’m looking at a three- to five-year perspective. If I can weather that short term, then I can build a solid foundation for the future.”

His advice to first-time or younger entrepreneurs:

Know your cash flow. “Most startups have a negative cash flow, negative equity,” Notman says. “What is your cutoff rate?” he asks. “You need to know. And how much are you willing to risk before saying, ‘I can’t do this anymore?’”

Get everyone you know on board — your spouse, your family, your partners. “If they aren’t, bad things can happen and the next thing is, you’ll be so far down you won’t know what to do. You can’t control all risks, but you can manage them as best as possible and focus on calculated risks versus going all out.”

Notman has learned along the way, too. He built his first firm by casting a wide net, which worked in Vermont. Now, however, he says he’s taking a “laser-focused, rather than a shotgun, approach.” It’s all about building relationships, he says. “I’ve never run a transactional business. You do what’s right for your clients and have that validated.”

The financial advisor hopes to gain 20 clients in his first year, which he admits is probably a lot fewer than what the industry at large would recommend. “I’m not looking at quantity as much as quality.”

Steadfast Capital Solutions, LLC
999 Fourier Drive #300, Madison, WI 53717
(608) 827-2104  | steadfastcapitalsolutions.com