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UBS Billionaires
Yesterday afternoon, UBS released its tenth annual Billionaire Ambitions report. Reuters and other news organizations quickly published short stories that, because of their broad audiences, rightly focused on the growth in the number of billionaires. It’s incredible how many more there are and how much wealthier they have become.
Between 2015 and 2024, the number of billionaires increased by more than 50 percent, from 1,757 to 2,682. (The peak was in 2021 when there were 2,686 billionaires, and the number has been flat since then.) Over that same period, total billionaire wealth increased by 121 percent globally, from $6.3 trillion to $14 trillion. In 2024, 1,877 billionaires were self-made and 805 were multigenerational.
The 60-page report dives deeper into the usual topics: their investment portfolios that outperformed equity markets, the technology sector propelling the proliferation of billionaires, and their expanding, more complex families. Others will synthesize this in their own newsletters or on social media, or you can always read the full report yourself.
What's not in the report is the UBS response to the influx of billionaires (most of whom have a family office of some kind), especially in North America.
In short, the Swiss bank still sees a big opportunity in the region, but it has to continue evolving and getting better at engaging those clients differently than it might in Europe or elsewhere. More North American billionaires, especially those who work in financial services, are in better positions to take risks and are willing to take them.
“The challenge for us is to make sure our offering for them is as sophisticated [as they are]. The reason I exist is partly to deliver institutional products and services to a [private] wealth client. Whereas 20 years ago, and probably still in Europe, the more normal conversation with a billionaire was how to deal with inherited wealth,” Charles Otton, head of global family and institutional wealth in the Americas at UBS, told Modus.
A growing number of billionaires aren’t just customers of a private bank affiliated with a Wall Street firm, they effectively are a Wall Street firm and they expect to be treated like one.
When Otton, who is also chairman of the global industries group at the investment bank, took on the wealth management role in 2022, he was tasked with making sure UBS was engaging family offices like any other energy conglomerate, hedge fund or endowment if they wanted and needed to be.
“They're going to continue growing and probably as a client base continue to be as significant if not more significant than they ever have been. We think they will be even more sophisticated,” Otton said.
In recent years, all the bulge bracket banks have started initiatives, such as OneUBS and One Goldman Sachs, to ensure that people and businesses are clients of the whole firm and not just part of it. Those efforts are global, but at UBS, North America has the most significant potential.
“I can only really authoritatively talk about the Americas, but I do feel as though we get the attention of the board and we're a growth area for UBS. And that's where I'd like us always to allocate the marginal dollar in terms of investment and what we're trying to do for billionaire families. It's not to diminish anything that's going on elsewhere, it's just that we are a growth region and within it, we're a growth business within the particular region,” Otton said.
CTA Drama
On Tuesday this week, a Texas federal court blocked the Corporate Transparency Act nationwide, putting every family office and more than 32 million other businesses in limbo just weeks before a January 1 compliance deadline.
“For good reason, plaintiffs fear this flanking, quasi-Orwellian statute and its implications on our dual system of government,” the judge wrote in a lengthy opinion.
Obviously, family offices and other entities don’t want to reveal who their stakeholders are. But no one is totally sure what to do next. As of this email, FinCEN has yet to issue a public statement about the broad injunction, and it is unknown if the bureau will delay the compliance deadline or appeal the ruling.
Read more details in the first Modus story here.
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Other News
- Mystery in Laurel Canyon: Questions cloud death of William de Rothschild
- Chile’s Richest Family Cuts Stake in French Firm Nexans
- What exactly is the difference between a family office assembly, council and advisory board? A recent Morgan Stanley report has a helpful table defining various structures and their purposes (see: page 8).
- Ken Griffin’s $44.6 Million Stegosaurus Is on Public View — for Now
Jobs
- This week, executive search firm Mack International began looking for someone to be the CFO and president at a single-family office in Chicago. The office was established in 2011 and works with three generations of family members. The new exec will oversee the usual: a family investment firm, private trust company, foundations and other entities.
If you're interested or know someone who might be, email Brian Adams. - State Street is looking for someone to head its Global Family Office for Wealth Services unit. This role will be “pivotal” in developing the global market for the family office offering and will work extensively on formulating and executing the market entry plans.
- Addepar has almost 75 open jobs. I know it employs over 900 people, but that still feels like a hiring spree.
Now what?
- Hit reply and tell me what you want to read about!
Are you interested in how other family offices invest in a specific asset class? How their employees are compensated? Their governance? Esoteric trusts? The software offices use? A specific person or trend? I’ve got ideas but I want to hear yours. - Follow Modus News on LinkedIn so you don’t miss timely articles published between newsletters.
- A lot of people have also inquired about contributing to Modus. To maintain a high bar, the publication will selectively publish work by freelance journalists and some other contributors. If you’re interested, here’s how to pitch Modus.
