Goldman installs JPMorgan’s Bryon Lake to boost public franchise

Goldman Sachs Asset Management wants its star hire from rival JPMorgan Asset Management to provide a shot-in-the-arm to the firm’s public-market franchise.

Bryon Lake, who starts Monday as a New York-based partner, will serve as GSAM’s chief transformation officer, a newly created role, according to a press release. Lake is expected to better bundle the firm’s different public-market offerings — such as exchange-traded funds and separately managed accounts — in a bid to gain ground in a fiercely competitive investment arena, according to Goldman’s Marc Nachmann.

“Our heritage has always been — on the investing side — we’ve always been active investors,” Nachmann, Goldman’s global head of asset and wealth management, said in an interview. “I would say we’ve probably been less-good on packaging, marketing and broad appeal. And so when you think about what Bryon’s done, he’s obviously done a phenomenal job on the active ETF side and growing that business.”

While GSAM oversees roughly $2.9 trillion in assets, the manager has been losing share in key corners, such as the rapidly expanding $9.4 trillion US ETF market. The firm commands just 0.4% of total industry assets, roughly flat since 2017, with $34 billion across its products. That means Goldman has so far missed out on massive growth in actively managed ETFs — an area that Lake predicted last February could reach $3 trillion by 2028, from about $721 billion currently. 

During Lake’s tenure at JPMorgan, its ETF assets reached an all-time high, propelling the bank into the ranks of top 10 largest ETF issuers. As GSAM’s chief transformation officer, Lake will have a broader aperture than just ETFs.

“We didn’t want to pigeonhole him into any of the one businesses,” said Matt Gibson, head of the client solutions group within GSAM. “We really expect him to help us come in and make sure all the various elements of the business are working together in sync because asset management is very much a team sport.”

One early area for improvement that Lake sees is Goldman’s quantitative capabilities. Part of Lake’s legacy at JPMorgan was helping to turn the actively managed JPMorgan Equity Premium Income ETF (ticker JEPI) and the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) into smash-hits, inspiring a wave of copycats funds.

Now, heavily concentrated stock markets trading near all-time highs creates an opportunity to encourage investors to rotate from income-oriented products into quant strategies, Lake said. 

“When you look at Goldman, the quant strategies have not been as pronounced because I think people have looked at other solutions, and I think now might be an optimal time to deliver some of those strategies,” Lake said in an interview. “That’s one example of a strong track record — quantitative capabilities — making them available through ETFs, SMAs, and bringing that conversation to the forefront.”