When the Geeks Meet the Street

If you work in Silicon Valley, selecting the right employer is a high stakes decision. Those lucky or smart enough to land jobs at Google or Uber or some startup that doesn’t exist yet could be multimillionaires before they hit 30.

Do youth and sudden wealth change the way clients choose and interact with financial advisors—or whether these freshly minted millionaires turn to advisors at all? To get one perspective, I talked to advisors at five Bay Area wealth management firms. Our conversations focused on how tech millionaires differ from earlier generations and whether these differences will cause the wealth management firms to change their business practices.


Let’s face it: Wall Street dominated prior generations of investors. Today’s parents and grandparents have seen the demise of the “customer’s man”—that now obsolete term for a stockbroker who represented his clients rather than his firm—and the rise of the Wall Street marketing machine. Advisors evolved into salesmen who were paid to maximize the amount of revenue they produce from client assets.

This sales culture isn’t going away; people will still buy what they are sold. But financial advisory firms are changing the way they interact with younger, more technologically advanced investors. According to the advisors I talked to, their biggest changes are in communications and transparency. They argue that financial firms that want to serve tech millionaires will have to play by some new rules.


Silicon Valley millennial millionaires have the same needs as their parents and grandparents: financial security, education for their kids, improved standards of living and retirement. Many have aggressive philanthropic agendas that they hope to implement at a younger age than did prior generations of entrepreneurs. They also have much different expectations of how frequently they can access their financial data, how timely their information is and what they can do with it.

Parents and grandparents were happy to meet with their advisors face-to-face maybe once a quarter. Wall Street loved it. Personal contact maximized the impact of advisor sales skills and slowed the flow of information. But there were consequences for investors: By the time they received information, it was too late to act on it.

Those days are over. To win over millennials, advisory firms will have to provide 24/7 access to information that members depend on to track results and make financial decisions.

The starkest manifestation of this change is the “robo” financial advisor, a new type of advisory firm that offers an automated investment process, online access to financial data and lower fees than traditional advisors—while minimizing human contact. Robo advisors also offer software platforms that allow clients powerful and customizable ways of analyzing their portfolios. This business model appeals to techies, who have no interest in meeting their advisor for a g-and-t at the club.


Transparency is the other area in which firms will have to change. In the financial services world, transparency usually means “what advisors choose to tell clients.” Lack of transparency, however, is a major source of financial risk. For wealth management firms that serve Silicon Valley, withholding information will no longer be an option. Information wants to be free. The firms that can provide more information in real time will be positioned to win this new generation.

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