Goldman Sachs builds private-market platform for wealthy clients

Goldman Sachs is expanding how it serves wealthy investors who want access to private companies before those businesses reach the stock market, CNBC reported. For everyday investors, the move highlights a bigger market shift: more potential growth is being captured before shares become available on public exchanges.

The bank has created an alternative investments platform, according to a Goldman memo seen by CNBC. Alternative investments are assets outside the usual mix of publicly traded stocks and bonds, including private company stakes, private equity and related funds.

The new platform combines Goldman’s existing alternatives business with two newly formed teams, CNBC reported. One team will focus on direct investments in individual private companies, rather than putting client money into broader private equity funds. The other will help clients buy and sell those private stakes.

Kristin Olson, Goldman Sachs’ global head of alternatives for wealth, told CNBC that clients have shown strong interest in large growth technology companies before they enter public markets. She said Goldman is responding to demand from wealthy clients and family offices, which are private investment firms set up to manage the assets of rich families.

Why private access is getting more attention

Goldman’s move fits two trends CNBC identified across Wall Street. First, Goldman has been building its wealth and asset management operations, businesses that the firm has viewed as steadier than investment banking and trading. Second, some successful startups are waiting longer before going public, which can leave more of their value creation in private hands.

Olson told CNBC that companies can now reach very large valuations before selling shares to the public. Her point is that investors who only buy after an initial public offering, or IPO, may be entering after much of the company’s earlier growth has already happened. An IPO is the process that lets a private company sell shares on a public exchange.

Goldman has arranged direct investments in later-stage private companies for wealthy clients for about 20 years, Olson told CNBC. She cited Facebook before its 2012 IPO, along with SpaceX, Stripe and Canva, as examples of companies where Goldman has previously helped provide access.

The bank is not aiming this effort at the earliest startup stage, Olson told CNBC. Goldman generally looks at later-stage companies that already have products, meaningful revenue and clearer routes toward profitability. That approach is meant to target a balance between risk and potential return, according to her comments.

AI demand adds fuel

The artificial intelligence boom has increased client interest, Olson told CNBC. Goldman is looking beyond well-known AI model companies and toward the infrastructure that supports AI, including data centers and related projects, according to CNBC.

The platform announcement follows Goldman’s report of record quarterly revenue, CNBC said. Goldman executives cited AI-related activity across investment banking, trading and financing, reinforcing investor attention on how the bank is tied to AI spending across the market.

The new structure also expands Goldman’s work in private-market liquidity. Liquidity means the ability to turn an investment into cash. Private company stakes are usually harder to sell than publicly traded shares, because there is no open stock exchange where anyone can buy or sell them during market hours.

Goldman’s new secondary advisory group will work on a marketplace for clients buying and selling private holdings, CNBC reported. It will also advise clients who want to exit private investments held outside Goldman.

This story draws on original reporting from CNBC.