Franklin Templeton Investments is searching for more than good investment ideas when its agents troll the globe. It's looking for good investors, too, selling its funds in 150 countries.
"Our goal is to educate, to create the market" in emerging countries, said Gregory Johnson, the company's president and chief executive. He was in St. Petersburg last week visiting the Carillon offices where 1,200 of Franklin Templeton's 8,200 employees work in administration, customer service, sales and support.
Those employees are here because St. Petersburg was home base for the sales and distribution operations of the Templeton Funds when Franklin Resources acquired the fund company in 1992. That acquisition was crucial to the company's ability to expand abroad, especially in emerging markets, Johnson said.
"Templeton gave us the footprint and the relationships to put together a business plan in those markets," he said.
Thirty percent of the $564-billion Franklin Templeton now manages belongs to investors outside the United States, up from 15 percent five years ago. That growth is the result of years of cultivating foreign markets, Johnson said. The company now has offices in 29 countries.
"You can't just go in and start selling the Templeton Growth Fund," Johnson said. Many countries' laws require partnerships with local money managers, which gave Templeton an advantage with relationships developed through decades of global investing. Franklin Templeton has investments in 85 countries.
The payoff can be seen in countries such as India, where Franklin Templeton has more than 1-million shareholders with more than $5-billion in assets and 1,100 employees. Two months ago the company opened a $40-million complex in Hyderabad, India.
The company runs "learning academy" workshops for financial advisers in emerging markets, where there are more novice investors who are heavy traders. The goal is get advisers to encourage clients to become long-term investors rather than speculators.
It has retreated from sales in only one market, Russia, although it still invests in Russian stocks.
In Europe, where mutual-fund investing is well established, the company's challenge has been competing against big banks selling their own funds. It has been particularly successful cultivating independent advisers in Germany, where its shareholders have $22-billion in assets.
Johnson says the opportunity for growth overseas is strong partly because aging populations have created a need to save for retirement just as in the United States. In addition, mutual funds are a smaller percentage of household financial assets overseas than they are in the United States.
The expansion has given Franklin Templeton a portfolio of about 500 funds, many of them available in just one country.
While Franklin Templeton is expanding jobs overseas, the company expects its St. Petersburg operations to grow as well, Johnson said. One reason is that the area enjoys a cost advantage over California, where the company has its headquarters in San Mateo. Another is that the company is committed to having U.S. employees handle calls from U.S. investors and brokers.
"We think that differentiates us and it's worth the cost," he said.
And of course, investment performance helps too. This has been a good time to be a global investor, with foreign stocks handily outperforming U.S. stocks over the last five years.
Helen Huntley writes about investing and markets for the Times. If you have a question about investments or personal finance, write email@example.com or Helen Huntley, Times, P.O. Box 1121, St. Petersburg, FL 33731. Read more questions and answers at http://blogs.tampabay.com/money