Wealth management firms are aggressively lowering management fees and expanding teams in Silicon Valley, scrambling to recruit employees from OpenAI and Anthropic. Both companies are preparing for IPOs, which will create a wave of new millionaires.

Following SpaceX's record-breaking public listing, Morgan Stanley's wealth management division, leveraging its employee stock plan custody business, attracted over $74 billion in new net assets from IPO-related activities last quarter.

Market expectations suggest that OpenAI and Anthropic will also go public within the next 12 months, which is set to ignite fierce competition in the wealth management industry. Bank advisors handling IPOs, like those at Morgan Stanley, will be key players in this scramble.

Financial data reveals that OpenAI alone distributed nearly $11 billion in equity compensation between 2024 and 2025. Even before its IPO, based on total employee equity grants, it already ranks seventh among U.S. listed companies, despite having only about 8,000 employees.

Jason Van der Lee, CEO of Choreo, a wealth management firm with $19 billion in assets under management, stated, "Wall Street advisors showing up in sharp suits and going through the traditional three-meeting sales process... that approach is no longer winning over these potential clients."

Last month, Choreo reached an agreement with over 100 current and former SpaceX employees. This group collectively negotiated lower fees before the company's IPO, ultimately securing a management fee rate of less than 0.5%. The standard industry fee is typically around 1% of assets, though rates often decrease for larger account sizes.

Another firm, Mariner Wealth Advisors, has a policy of reducing management fees once a critical mass of clients from the same company is accumulated.

Institutions like Citibank are taking a different approach, recently partnering with Palantir to directly negotiate agreements with corporate employers, securing favorable fee terms for their employees.

Steve Moye, director of strategy at Mariner Wealth, explained that the firm has also adjusted its fee structure to compete for clients. It now charges separate service fees for pre-IPO tax planning and equity compensation planning, rather than charging a blanket management fee on illiquid, non-tradable equity. Only after employees sell some of their shares and realize the cash will the firm switch to the standard industry model, charging a management fee based on total assets under management.