Goldman Sachs is ramping up its ambitions to capture a bigger piece of the wealth management industry's fastest-growing niche. The latest evidence: a senior executive shakeup that serves as a warning shot to large brokerages.
The investment banking giant said Feb. 6 in an internal memo that it was intensifying its plans to become a powerhouse custodial magnet and resource for registered investment advisory firms and top-tier financial advisors looking for independence from Wall Street wirehouses — on top of
As part of Goldman's initiative, Joe Duran, the former head of Goldman's Personal Financial Management unit, is stepping down from his role as partner to become an outside consultant. Duran, who
Longtime Goldman veterans David Fox and Dave Dase will fill Duran's shoes.
Fox, who joined Goldman as a private wealth advisor
Dase, who was previously the head of franchise relationships in the Consumer and Wealth Management unit last year, began his career at Goldman
Duran will
"I want to continue having a great relationship with the firm," Duran said in an interview, adding that he hoped to provide "objective perspective" in turn to the firm."They want me to be helpful to their cause."
He added that Goldman offers a boost to brand recognition and bespoke services that many independent advisory firms could use. "We are well-recognized as a leader in ultrahigh net worth and institutional advice and wealth," he said. "We think we can bring something unique to the RIA community that would help them be more successful with their clients."
A different value proposition for RIAs
Padideh "Padi" Nora Raphael, Goldman Sachs Asset Management's global head of third-party distribution — in other words, the firm's main point person for its plans to unify RIA-targeting services under its
These services include expanded investment opportunities, particularly in private markets, as well as lending, cash solutions and investment banking.
"My key objective is to help Goldman Sachs in its aspiration to become the most valued service provider and advisor to the high net worth, advisor client base, including RIAs," Raphael said in an interview.
She added that Goldman's differentiating points for independent advisors were "decades of our experience serving our own ultrahigh net worth clients as well as the most sophisticated institutional investors around the globe, and bringing our capabilities, advice, convening power and thought leadership to the independent advisor community."
Goldman is aiming to carve out market share from big names that have long
In 2020, Goldman laid the foundation for this plan when it acquired RIA custodian
The moves come as talent wars in wealth management rage and
A second goodbye
Asked in an interview if he had signed an exit deal involving compensation, Duran laughed and said he had not. "There is nothing like that and I wouldn't be sharing it anyway," he said.
Duran said he was "a little sad" and felt "bittersweet" about leaving close colleagues at the former United Capital, which he had built for 15 years, but that he feels "very excited" about being unleashed to work on other projects. He added that he "thrived on building things" and would be interested in doing "something fresh and new in the RIA segment," hinting that he might try to form new businesses in the space.
"It's not really my baby," Duran said of his former company.
"You build the first one, that one is your baby. The second one, you realize it's just a business … like an apartment building that I built. I care more deeply for it, and obviously the people inside are very, very important to me, but change is how you grow."
Duran said advisors at the former United Capital had benefited from the power of the Goldman name, which had been "very useful for our advisors to gather bigger clients" and given them a chance to offer products like alternative investments and banking solutions.
"We have more advisors than we had. We certainly have a lot more assets than we had," he said.
The firm declined to share how much the PFM group or custodial unit had grown in assets or advisor count over the years, but a spokesperson for Goldman said in an email that the workplace and personal wealth management channel has approximately $100 billion in assets under management and 600 advisors.
Readying to roll
Jason Diamond, an industry recruiter at Diamond Consultants whose firm has worked with several advisors on moves that involved choosing Goldman for custodial services, said in an interview that he wasn't surprised that the old United Capital's identity had been folded into the Wall Street bank.
"Anytime a firm gets acquired, whether it's an RIA or a broker dealer or just any sort of transaction, there is a risk or a possibility that the new firm structure fits differently than the previous firm," Diamond said.
With regard to United Capital, "what we're hearing is that increasingly, that brand is just being folded more and more into the Goldman brand."
Diamond said Goldman's game to advance in "one of the hottest corners of the market, this market for breakaway advisors looking to start or affiliate with, or launch an RIA" was likely to pay off.
"Goldman is a very attractive custody option, once they get off the ground, for those advisors," he said.
