India’s Upwisery MFO Head Casts his Expert Eye on the Country’s Rapidly Evolving Wealth Market

On June 8, Hubbis assembled a panel of leading personalities in the Indian wealth management market to pinpoint current trends and to predict the more key evolutionary trends for the years ahead. They zoomed in on the incredible potential that India’s wealth management market represents, including even India’s pivotal position between the key wealth centres and economies of Asia and the Middle East. And they outlined where the opportunities lie and what challenges there are for competitors seeking to build or expand their market share. Prashant Joshi, Co-Founder & Partner of Family Office Advisory at Upwisery, was a new addition to our panellists, and made a fine contribution to the discussion. He offered delegates a variety of insights and nuances that Hubbis has distilled into this short report.

Prashant offered guests a view on Upwisery and its missions, explaining that the firm is a financial business that operates in three main verticals - investment banking, M&A - tax and regulatory, and the third leg is the private wealth and MFO operation, in which they cater to UHNWIs and single-family offices for specific advice and services.

He said that pretty much every prominent business family in India and any wealthy family tends to become more and more global in nature, with some family members and different generations moving overseas, perhaps operating family businesses there, or studying, and this means there is increasing need for advice on structures and investments and other areas. Often, he explained, they might want to set up entities or even family offices in other jurisdictions outside India, such as Dubai, Singapore and so forth.

He explained that they also cater to the needs of these clients’ objectives beyond simply their investment journeys. “Wealthy Indian families are focused now increasingly on and more accepting of the whole concept of robust estate and succession planning,” he reported.

“They want to have those types of more holistic discussions around how their assets are held and the ramifications of making certain investments, and they want to more accurately integrate all these elements into their investment journey today and look at a solution in totality.”

He elaborated on these points by noting that India is increasingly connected to both Asia and to the Middle East, with many families expanding into both these regions, building bases and in the process, opening up opportunities for the Indian wealth industry.

Such opportunities are, for example, in terms of clients becoming aware of the opportunities outside India to diversify their portfolios and focusing even on new areas such as ESG in Europe, or perhaps AgriTech in Israel, opening the doors to digital assets and blockchain and other technologies, as well as opening the door on India as well, showcasing key sectors of the dynamic economy such as technology, consumer, healthcare and infrastructure, which offer great opportunities ahead.

“Specifically for the wealth management side of our business, we have been in and out of Dubai many times, and discussed with private banks, family offices and others about their allocations to India and we found that as they look increasingly globally, India was less of a focus, and really only through feeder funds and so forth,” Prashant explained.

Accordingly, Prashant and colleagues have been encouraging them to think about directly participating in India through various assets and managers. “They tell us that information is quite limited, and while they might want to participate more actively in the Indian growth story or want to leverage the India growth story, they are not very aware of the options out there,” he reported. “And this means there is great opportunity.”

Prashant then offered his perspectives on the evolution of the family office scene in India, observing that this is a natural evolution as wealth increases and the needs of wealthy families diversify and become more sophisticated and, as he had indicated, as more robust organisation, estate and legacy planning and structuring takes place.

The single-family office setup is of course more dedicated to the families with USD150 million or more to invest and manage.

Meanwhile, smaller families and small family offices can often farm out their investment and other needs to third-party experts such as Upwisery which offer expertise in a wide variety of key areas, as well as independence and objectivity, as they are not tied to any specific financial product or proprietary solutions. “This means these families can obtain the value of greater flexibility and objectivity from these types of experts in recommending strategies and frameworks for these clients,” he elucidated.

He drilled down further into what Indian private clients need and expect these days. “In India today, we are uniquely placed as there are three key developments taking place. “One is that traditional ultra HNW businesses and families are going through or starting out on huge and important business and wealth transition. The second element is the rapid expansion of New Age tech-driven businesses, with huge wealth created very rapidly in the past 10 years and now, and with numerous creators then monetising their businesses partially or fully, adding to the vast private wealth pool in the country. And third, there is a growing cohort of super-salary and ESOP wealth creating more and more individuals qualifying for HNW status and above.”

All this means that there is incredible and growing diversity in the types of approaches these people will take to their investment needs and journeys, and that will dramatically help shape the upper tiers of the Indian wealth industry for many years to come.

For example, he said that a big business family with many decades of development and who is transitioning might have a very different understanding of commercial real estate from a person who has built up a business in only a number of years and has a very different outlook on all types of investments, and indeed rather different time horizons.

Moreover, as wealth spreads more completely across the length and breadth of India, there are very different views on wealth management from clients in the second and third-tier cities – often housing more tech-related enterprises - from the major tier-one conurbations that often hold the older and more traditional wealth.

Prashant closed his commentary by highlighting a few key priorities for him and his firm for the next year or several years ahead, including investment in technology to build a better internal team and external client experience, focusing on guiding clients more towards a diversified and strategic approach to investments across markets, geographies and asset classes, and becoming even more proficient at curating the optimal ideas and opportunities for those clients.