Silicon Valley Firm Helps the Wealthy Keep Track of $1.7 Trillion of Assets
Silicon Valley Firm Helps the Wealthy Keep Track of $1.7 Trillion of Assets
(Bloomberg) -- The ultra-secret world of ultra-wealthy investors is becoming slightly more transparent.
Addepar Inc., whose investors include billionaire Peter Thiel and Palantir Technologies co-founder Joe Lonsdale, is working with hundreds of money managers to give a better sense of where their clients invest. Assets linked to the firm’s technology are growing at an average of $10 billion a week and have reached $1.7 trillion, Addepar Chief Executive Officer Eric Poirier said.
It doesn’t handle the money. Addepar helps manage data for firms like Morgan Stanley, Jefferies Financial Group Inc. and an array of registered investment advisers, poring over complex information that for many years had been hard to aggregate. That includes data for hard-to-value private assets like hedge funds, artwork and real estate held by wealthy clients.
“We’ve effectively built industrial-strength plumbing” to securely allow investors to put all of their holdings online in one place, Poirier said in a phone interview.
Mountain View, California-based Addepar now has more than 400 clients, including family offices, banks and registered investment advisers. Its growth comes as private equity and debt firms have been raising record sums of cash and investors seek yield away from more easily tracked public markets.
Lonsdale started Addepar in 2009 upon leaving Palantir, and by 2012 the firm had just a couple dozen customers and was composed of mostly young, male engineers. Since then it has hired industry veterans including David Lessing -- a former executive at Morgan Stanley’s wealth manager. Ex-Blackstone Group Inc. executive Laurence Tosi joined the board.
Tosi said he believes Addepar will grow faster as markets get tougher because more clients will want control over their assets in times of heightened volatility.
“It’s quite cumbersome in crisis if you don’t have, what I call, eyes on the battlefield,” Tosi said. Given that most wealth managers have oversight for only a portion of clients’ total assets, he said Addepar’s “innovation curve has been faster.”
Addepar isn’t alone in collecting data in the opaque world of private assets. Financial-technology firm iCapital Network has been working with banks and RIAs and has added $42.3 billion of assets to its platform since its 2013 founding, according to its website.
To contact the reporter on this story: Sonali Basak in New York at sbasak7@bloomberg.net
To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Dan Reichl, Peter Eichenbaum
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