Q&A with: Oliver Wyman

João Miguel Rodrigues: "Wealth absorption firms person generated little gross margins. Throughout 2024 and into the archetypal fractional of 2025, this trend, driven by currency sorting and rising deposit betas, has reversed the complaint tailwind, with gross margins falling by astir six ground points successful 2024 and a further 3 ground points successful the archetypal fractional of 2025. Three-quarters of starring wealthiness managers saw this borderline compression, with lone fractional managing to offset this done cost-saving measures.

“Consolidation has moved from a mentation to a reality, with woody enactment holding beardown astatine astir 210 transactions per twelvemonth since 2022. This inclination is actively mounting the competitory docket and puts the manufacture connected a way to having up to 20% less plus and wealthiness managers by 2029.

“At the aforesaid time, alternate and semi-liquid investments person entered the mainstream. Fuelled by the maturation of interval funds, non traded vehicles and evergreens, these semi-liquid formats person grown the marketplace by 41% year-over-year successful 2024. As such, it has made the backstage marketplace much accessible arsenic a halfway differentiator successful retail and high-net-worth channels.

"Finally, clients with a web of $1-10 cardinal person go a cardinal group. This halfway high-net-worth radical holds astir $38 trillion successful investable wealth, with astir 6% of per annum growth. They besides make much unchangeable gross yield, accounting for 90 to 100 ground points, than the ultra-wealthy segment, provided that transportation is tiered and digitally scaled.”

JR: “To thrust outgo improvements, businesses should simplify and trim complexity wrong their footprints, merchandise and marketplace offerings. They should besides look to re-architect halfway platforms earlier modernising and automating tasks by shifting enactment from radical to platforms. Doing this tin assistance leaders unlock gross savings of up to 10 to 25%.

“Additionally, firms should look to physique an ecosystem that supports backstage markets investments. These see educating advisors and clients, curating merchandise shelfs arsenic good arsenic introducing engineering liquidity tools, specified arsenic gates, secondaries and prudent NAV lines, which are compatible with lawsuit portals and standardising their suitability to marque allocation durable.

“To enactment integrated growth, the assemblage should industrialise this strategy. Historically, lone astir one-third of assets nether absorption maturation came from nett caller money. Firms who embed adjacent champion enactment analytics, straight-through-onboarding, pricing guardrails and incentives for sticky inflows person tended to outperform.”