After two years under private equity ownership, Wilshire Advisors is embracing a new identity — and it’s not just about dropping the “Associates” from its name.
The long-tenured investment consultant has undergone multiple identity transformations, from indexing giant to asset/liability modeling pioneer to mutual fund provider. Now, Wilshire wants to expand its global reach, add tech capabilities, and grow its OCIO practice. For the first time at the firm, this means becoming more acquisitive, thanks, in part, to its owners, CC Capital and Motive Partners.
“We’re two years into new ownership,” said Jason Schwarz, deputy CEO. “The next dimension is building on this. How we are using tools and tech is a core element of the business [that] is unchanged, but there are new ways to invest in growth.”
Wilshire was acquired in January 2021, at which time Dennis Tito, the firm’s founder and CEO, stepped down.
Along with the acquisition came new leadership: Mark Makepeace, founder of FTSE International, took up the CEO post, while his former colleague, ex-FTSE International chief financial officer Nick Teunon, joined as CFO.
Motive Partners’ Andy Stewart joined as chief innovation officer and was later promoted to deputy CEO, while Jody Kochansky joined as chief technology officer. During this transition, Schwarz became COO and continued to lead the investment and portfolio activities. A year later, Leah Emkin was promoted to chief client officer.
With the new executives in place, Wilshire executed a rebrand, complete with a new website and new name.
Next came a bevy of new hires. Over the course of 2022, the firm added Mercer’s Julija Kod and Nathan Howes and Teacher Retirement System of Texas’s Lauren Gellhaus to serve on the institutional client solutions team.
Meanwhile, FTSE Russell’s Jim Cemprola, Blackstone’s Tina Pham, and MSCI’s David Orces joined Wilshire’s North American sales team. Additionally, Lawrence Miller from Signant Health joined as chief technology officer, replacing Kochansky.
But it’s not just the team makeup that has changed under the new leadership.
Prior to the acquisition, Wilshire’s business lines, which included analytics, consulting, funds management, and private markets, operated relatively independently from one another. Wilshire has now integrated those business lines, with Emkin taking the lead in bringing the separate client teams together to create a more cohesive working environment. “It’s more consistent and efficient,” she said.
“Two years ago, we would have been more scattershot,” Schwarz added. “Leah has reorganized the consulting group to get a clear line of sight.”
Over the course of 2022, Wilshire expanded its indexing capabilities, launching a global index series that includes separate country-by-country indices, developing and emerging market indices, a multi-factor index series, a climate change index series, and a customizable index application.
This expansion set the stage for Wilshire’s March 2023 announcement that it is setting up a new entity for its indexing business that will operate independently of Wilshire. The Financial Times and Singapore Exchange are strategic partners on that deal.
With that move came another shift in leadership: Makepeace, who had been Wilshire’s CEO, is now leading the indexing business. Deputy CEO Andy Stewart took over Makepeace’s post, while Schwarz assumed the deputy CEO role in addition to serving as president.
Beyond the index business spinout, Wilshire has been modernizing its technology stack to improve how it delivers information to clients via portals. Prior to the 2021 deal, the firm had separate databases for private equity, hedge fund, and other investment research. Those have since been combined.
And according to Schwarz, this is an area to which Wilshire would consider adding more expertise. “Wilshire was not known for M&A,” Schwarz said. “That has changed and will continue to change. We are thinking about bolting on different capabilities.”
One potential area for acquisition lies in technology, although Wilshire has also set its sights abroad. The firm’s advisory clients are primarily based in the United States, except in one area: private markets. Wilshire is considering expanding via acquisition into Germany, the United Kingdom, or the Netherlands. According to Schwarz, he expects Wilshire to be “more active” in terms of dealmaking over the next two years.
The outsourced CIO market is also ripe for M&A. Schwarz, who called the industry “highly fragmented,” noted that more than 50 OCIO firms operating in the United States have less than $20 billion in assets.
“We think acquisitions are a way to handle that,” he added.
