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Medium Growth Strategy Market Expansion

Mischief Managed

#Finance #Private Wealth Management
ProHub Comment

This is a structured market expansion case requiring candidates to size opportunity markets, analyze competitive landscapes, and make a recommendation. The case tests both quantitative skills (market sizing calculations) and qualitative judgment (interpreting competitive dynamics and market attractiveness). Dallas emerges as the optimal choice due to its large addressable market ($105B opportunity size) combined with fragmented competition (50% market share uncaptured).

Estimated Time 15 minutes
Difficulty Medium
Source Duke
50 / 100
After successfully servicing the needs of ultra-high net worth individuals in the Atlanta area for ten years, our client, Smith Wealth Management (SWM), is looking to expand geographically. Specifically, the CEO of SWM has brought you in to recommend a plan of action for evaluating potential expansion opportunities. How would you approach both sizing the market and making a final recommendation on an expansion strategy?

Clarifying Information

  1. SWM provides holistic wealth management services, including fixed income, public and private equity investing. Unlike some of their competitors, they do not provide ancillary legal or tax services.
  2. SWM has $10B AUM (assets under management) across 500 clients. They have a minimum of $5M investable assets and the average account size is $20M (candidate should also be able to quickly calculate this).
  3. SWM charges an average advisory fee of 1% ($10B x 1% = $100M in annual revenue)
  4. No clear revenue or AUM goal but candidate should be able to contextualize the opportunity size to decide if expanding is worthwhile.
  5. The wealth management space is highly competitive, with both large players (ex: Goldman Sachs, JP Morgan) and smaller, more niche and local firms competing for the same clients.
  6. SWM offers access to fixed income and equity mutual funds, ETFs, and separate accounts, as well as alternative investment vehicles such as hedge funds and private equity funds.