The deal will accelerate Goldman Sachs’ expansion in services to the growing defined contribution market through personalised managed accounts and digital advice.
In addition, the acquisition of NextCapital will boost Goldman Sachs existing asset and wealth management businesses with another tool for sponsors and other clients.
David Solomon, chairman and CEO of Goldman Sachs, said: “This acquisition furthers our strategic objective of building compelling client solutions in asset management and accelerating our investment in technology to serve the growing defined contribution market.”
“Employers are looking to provide their employees tailored solutions and customisable advice that can better support individual saving and investing needs to help improve retirement savings outcomes. We believe personalisation represents the future of retirement savings and will drive the next wave of innovative retirement solutions,” said Luke Sarsfield, global co-head of Goldman Sachs Asset Management.
“Together with NextCapital’s talented team, we will continue to invest in technology to improve the experiences and outcomes of retirement investors and better serve the employers, advisers and financial institutions that support the growing $10trn DC market and the even larger IRA segment.”
John Patterson, CEO at NextCapital, added: “Our vision for the future of the retirement savings market is aligned with the team at Goldman Sachs: technology that can create a differentiated experience combined with a strong culture and focus on clients forms a powerful offering for our clients and the individuals they serve. We can leverage the resources of a global financial services firm to continue to scale our platform and offer it to new third party institutional clients and Goldman Sachs’ broader wealth management organisation.”
Chicago-based NextCapital is an open-architecture digital retirement advice provider that partners with firms across the US. The deal is expected to close in the second half of 2022.
As a result, the platform will become part of the MAS business of Goldman Sachs Asset Management.