On 18 May 2012 something happened in the world of wealth management. Something significant. Nearly 1,000 people had a status change on their Facebook site from Employed to Target.

Of these 1,000, six hundred newly-minted millionaires (oh, and a couple of billionaires...) work for Facebook and a further 400 millionaires were minted as a result of working at Facebook or being an early private investor in it. Hold that thought for the rest of this piece.

The issue to my mind is how valuable the digital network world including the likes of Facebook, LinkedIn, Xing, Ren Ren and the rest can be for wealth management prospecting.

Indeed, the big question in the industry is where does profiling and social media collide for the interests of business development and the future growth of the industry. The current situation in terms of new asset growth into the wealth management sector is still below the global growth rates of wealth.

To back this up, just consider the recent report from Boston Consulting Group which puts global HNW household annual wealth growth at around 8 per cent. This is far above, more than double in many cases, the net new money levels we are seeing in the Annual Global Private Banking Benchmark where we track the business model performance of over 200 wealth management operators across the planet. The next wave of results is due out from us shortly.

Two questions      

So the dual questions of where to find this new wealth being charted and how to tap it are vital. Social media and business development remain a riddle for the sector. It is a riddle we all grapple with. At present the industry believes that there is a divide between the world of social media and the rest of the online world - we presume that the latter is called non-social media. And this divide, in their view will not be crossed. Ever. There will be no primordial leap moment, according to many of the wealth management leaders of today.

The argument goes that what happens in your social world, either online or offline, is not relevant or related to your financial world. At a superficial level this may be true, but this misses the opportunity. In fact, we believe in the possibility of a world where there will be an integrated world of the social and so called non-social. Online. In fact, we don't think of it as a possibility. We consider it inevitable. In the good old days it was apparently called the golf course.

Perhaps the current generation of sales-focused relationship managers won't adjust, but the next wave will. They will become the "networked RM". They will be comfortable interacting with the digital social world to identify and relate to potential targets. They are already building their reference characteristics, as far as we can tell and in the ways we are helping firms to augment their online environment.

For example, the vast majority of industry professionals are now online through LinkedIn. It took a while, but it has happened. But, crucially, the true value of LinkedIn is not that you are online, it is the connections that are possible from the network. That has always been the focus of the model. The ability to reach others that you might not know directly but could be referred to rapidly through a trusted network of contacts is the heart of the program. (This is, by the way, a very similar approach in many ways to Facebook).

Practical examples

And it is working. I recently met private bankers in Hong Kong who openly stated that through using this "professional social media" they reached not just advisors to clients but in many cases the clients themselves. Eventually, they went from an online relationship to an offline pitch. It was good to hear it was happening. We had been predicting this for a while based on our insight work with investors worldwide who outlined very clearly the importance of the digital environment to their financial as well as non-financial interests.

It was even more encouraging to hear a similar story in Rio de Janeiro with the head of an ultra high net worth business team. They tapped into a family office opportunity in Recife through digital connections. And when I bumped into a senior banker in Geneva, he shared a similar story too. Significantly, this Genevois banker was stunned that in two cases that month it was the prospective client that sought him out, not the other way around.

So, this divide between the social media and non-social media world online is really not there, except in the minds of the traditionalist bankers. Don't forget that Goldman Sachs created an online digital community for its alumni a few years back and reportedly 20 per cent of its corporate advisory mandates that year originated through the network and, crucially, not all came from ex-employees. The fact was that the institution had a creative approach to using the social media world for business development and created a new access point to their teams.

Changes

So, let's get back to Facebook and that status change. Of course it did not actually change to Target, but I trust you are getting the drift now. These wealthy employees’ lives have changed in financial terms, possibly beyond their wildest dreams. Their profiles are pretty visible – as that is the culture of their business.

Crucially, while they may have more investable money, their habits of communicating and solving problems honed over a professional life time will not have changed and most likely will not change in the future. Facebook is their connection gateway to the digital world and the community of friends and professionals they engage with. Rather like the other billion users that are members.

We could all do well to watch their habits closely and listen to their opinions on the world of digital networks and how they will use them in the future. There will be plenty of signposts on how the wealth industry can adapt. I am certain of this. In fact I am pretty sure we can already see the signs. For instance, one of the founders and backers of LinkedIn is now developing an online wealth solution to solve his community's financial interests. He is modeling it on his LinkedIn days and the industry should watch this very closely.

Therefore, to conclude, I believe that the primordial leap I mentioned at the beginning of these thoughts has already taken place. The next stage of the evolution is when the world of Facebook founders (and their users) take the time to start solving the riddle of how to manage the fortunes they now possess with the rest of their lives. The answer is going to involve the digital world; I would bet all the gigabytes that I possess today on it...