The Swiss bank’s social media platform for the ultra-rich is moving ahead, but in a different form than originally planned. And with an intriguing strategic plan, which shows that Credit Suisse hasn't entirely written off the U.S. wealth market.
A pet project of Credit Suisse Chairman Urs Rohner, who first touted the project more than two years ago, the Swiss bank is working on an exclusive social network for the wealthiest of its clients. A kind of Facebook for billionaires.
In December, finews.ch reported the name of the project – Eleven – in homage to Credit Suisse’s New York headquarters at 11 Madison Avenue.
For the Rich
The platform is meant to enable a host of services, according to a trademark filing. Besides being a social media club for the world’s richest, Eleven can facilitate auctions as well as more typical banking services like private equity and venture investments, real estate financing, and broker transactions for luxury cars, yachts, jewellery, art and fine wine.
According to rumors, Eleven is a club for those with at least $10 million in assets.
From Eleven to Clade
Now, U.S. advertising publication «Ad Age» has revealed a last-minute change to the project: Credit Suisse has spun it off and Eleven is called Clade.
Credit Suisse holds only a minority stake in Clade, according to the report, and unknown investors have come on board instead. Both founders however, former CS bankers Jonathan Lipton and Jan Oliver Koelble, are still part of the project. And the platform is sticking to its original plan, to be a «velvet-rope investment club for the wealthiest people in the world».
Clade's name is a literal reference to its exclusivity: the term refers to a branch on the tree of life, or the similarities in a group of people.
Cooperation Like Palantir
The fact that Eleven has mutated into Clade so quickly isn’t a coincidence: insiders report that the project is being pushed from outside the bank in order to foster a rapid pace of innovation.
The partnership is similar to one Credit Suisse recently entered into with surveillance software firm Palantir. Neither Credit Suisse nor Clade’s founders commented to «Ad Age».
Clearly, Credit Suisse wants to keep a foot in the Facebook for billionaires project, despite massive restructuring saddling the bank. The project has survived the troubled bank’s scrutiny at a time when Credit Suisse is forced to reevaluate the value of each and every engagement.
That’s also not a coincidence: Eleven, now Clade, plays a role in a Credit Suisse strategy paper, sources tell finews.ch.
U.S. Entrepreneur Bank
The plan is for CS to eventually enter U.S. private banking again, a market the bank officially stepped away from last year when it sold its U.S. wealth unit to Wells Fargo as part of a major overhaul to bolster capital.
But Credit Suisse harbors plans to replicating its «bank for entrepreneurs», successfully implemented in Asia, in the U.S. market, a source told finews.ch.
Credit Suisse Chatter
The unit would work closely with the investment bank and target those with self-made wealth, who typically command more sophisticated and demanding investment products than relatively straight-forward brokerage or asset management.
The expected start of Clade is fodder Credit Suisse private bankers in Switzerland, who have voiced their displeasure that the bank is spending money on projects in the U.S. when other units are bearing the brunt of painful cost cuts.
Silicon Valley
Clade could become a valuable element in a potential revival of CS’s U.S. private-banking ambitions. A key element of the network is the type of self-made millionaires who are prevalent in the west coast-based technology industry.
The typically young, wealthy and social media-savvy client is exactly the type of lead that Credit Suisse would target should its entrepreneur bank make a renewed U.S. push.
CS Corporate Clients
The bank already has until very recently made valuable inroads into that segment as corporate clients – and thanks to Clade, would be in a strong position to cater to the private financial needs of young billionaires as well.
Credit Suisse is currently struggling with three-year targets. If Clade’s reference to the tree of life proves prescient and Credit Suisse can eventually translate the platform into a successful American push, it would be an unprecedented break by a European bank into the upper tier of the U.S. private banking market.
