UBS, the prominent Swiss multinational financial services company and investment bank, is acquiring automated investment services firm Wealthfront, with hopes of expanding its reach in the United States and among millennial and Gen Z investors. The all-cash deal is reportedly worth $1.4 billion and is set to close in the second half of 2022. Founded in 2008, Wealthfront boasts more than $27 billion in assets under management with over 470,000 customer accounts. The company’s automated investment platform allows users to easily establish customizable and diversified portfolios while maximizing returns and minimizing taxes — all features that are highly attractive to new and younger investors.
As the largest Swiss banking institution and the largest private bank in the world, UBS brings considerable experience and resources to Wealthfront, which will benefit from its deep research capabilities and additional services. Additionally, with the purchase, the Swiss financial institution is set to compete with U.S. institutions like Goldman Sachs and Morgan Stanley, who are also vying for the lucrative business of a new, technology-driven class of unorthodox investors more likely to propel stocks based on memes or emerging trends than traditional growth stocks. Wealthfront will become a wholly-owned subsidiary of UBS, operating within UBS Global Wealth Management Americas.