Goldman Sachs and Ayco in huge financial coaching deal with Google
Ayco wins a major deal with Google
Ayco, a subsidiary of Goldman Sachs that provides financial counselling to employees, has signed a massive deal with Google, according to Business Insider.
Ayco (and, by extension, its parent) will provide financial coaching to Google’s US-based employees, “working with everyone from Google’s executive officers down to its first-year coders”, Business Insider says.
The deal is one of the biggest that Ayco has signed to date. Until recently, the company has focused on very senior corporate executives. It has CEOs at 22 of the Fortune 100 companies on its client books and many current and former Goldman partners.
But now corporate management teams are asking for a solution to offer to their entire staff base, Ayco’s president and Goldman partner, Larry Restieri, tells Business Insider.
“Newer economy companies – so a lot of the West Coast tech firms – won’t even talk about executive counseling unless there’s a solution for all the employees,” he notes. “So getting into financial wellness was a business imperative.”
Ayco has reworked its platform to make it more customisable, so companies can choose to auto-populate employee information like social security numbers or 401K balances, and even allow Goldman Sachs to sell its products (loans, savings accounts etc) from clickable links served beside questions about credit-card debt or emergency funds.
In addition to the tech platform, onsite seminars and telephone coaching (from Ayco’s call centre) are available. Executive clients also get access to a financial advisor, who can explain benefits, prepare taxes, sell insurance, help with estate planning and choose investments.
Restieri adds that investment products, such as managed portfolios and investment sleeves to augment assets held elsewhere, are currently under consideration.
Google employees who log onto Ayco’s platform will be surveyed about their financial health, answering questions such as whether they do tax planning throughout the year or have money set aside for an emergency.
The provider says the platform’s algorithms will ensure that a young employee will get different questions from someone nearing the retirement.
Once they complete the survey, they’ll be assigned a score out of 450 and a checklist to help them improve it.
Ayco: what’s next
Ayco was established in 1971. In 2003, it was acquired by Goldman Sachs and operates as an independent entity within the group. At the time of the acquisition, it had $7 billion in client assets. Since then, this number grew more than tenfold to over $75 billion and revenue more than quadrupled. This is attributed to an aggressive push of moving Ayco’s client assets onto Goldman Sachs’ platform.
Eric Lane, a division co-head of Ayco, tells Business Insider the company is “a big driver” of the more than $1 billion slated to come from individual clients of Goldman Sachs’ asset management business by 2020.
He adds there is a possibility for Ayco to expand beyond the corporate environment – as there are opportunities to work with Goldman Sachs’ consumer banking offerings such as Marcus and Clarity Money to bring a full suite of financial products to the US mass market. Marcus, for example, has already onboarded over one million clients in the US since its October 2016 launch. “Given the client bases that we’re focused on, we’re probably going to spend a lot more time together,” muses Lane.
Ayco has 1,600 staff working at 22 offices across the US.
