“For right now, we will stay as ‘United Capital, a Goldman Sachs Company’, but that will change over time,” Duran says.
Once United Capital and Goldman Sachs CEO David Solomon are completely in synch on how to position United as “one brand and one platform,” the change will happen, Duran says.
“We want to have a very thought-out strategy on the best way to go to market and create the biggest opportunity together” before changing the name, Duran says.
“Goldman will now be evaluating how to incorporate United Capital alongside its other consumer brands,” like Ayco, a source familiar with the deal tells FA-IQ.
Ayco services the financial counseling and investment management needs of corporate executive and employees.
United Capital adopting the Goldman name makes a lot of sense, Chris Cordaro, partner and chief investment officer of $3.1 billion RIA RegentAtlantic, says. “There are a lot of people enamored with the Goldman Sachs name and it certainly helps their marketing and provides some third-party validation to have that name behind you,” he says. “If someone from Goldman and someone from United are calling people, Goldman is more likely to be given the benefit of the doubt right off the bat,” he says.
“If I were a buyer today, I’d find it hard to transact at these levels,” he said. But since Goldman Sachs does not have a wealth management business the $750 million price may be “quite cheap since [it] can immediately [get] an infrastructure and a group of advisors who are quite talented," he said.
“We are not a brokerage firm and we are certainly not like LPL. We have much higher average advisor quality,” Duran says. “We are also a fiduciary, an RIA with a recurring revenue stream, have organic growth, in-depth technology, and provide an amazing client experience. In our industry almost every advisor lives on yellow pads and its exceedingly rare that our entire experience can be done on an iPad,” Duran comments.
Of United Capital’s 220 advisors, the average FA manages about $113 million in client assets, according to a press release. The average LPL advisor oversees about $42 million in client assets, according to a first quarter 2019 earnings report.
United and Goldman will also continue United’s M&A push following the RIA deal, Duran says.
“Our goal is to be a part of expanding Goldman’s and Ayco’s efforts into the $1 million to $15 million mass affluent client market,” he says. United currently has 95 offices but will certainly need to add more, Duran says. And acquisitions will be used if they are the most economical way to enter a new market, he says.
“If other RIAs around the industry feel a sense of relief that United Capital is not out there, they are not looking at this the right way. We intend this to be an accelerant to our growth and we will grow even faster than we have in the past,” Duran claims.