[Editor's note: This story was originally published on Sept. 12, 2025, but needed to be republished due to a technical issue.]
The emergence of alternative investments in wealth management is a trend that’s only set to accelerate, according to Franklin Templeton CEO Jenny Johnson. Financial advisors who lack expertise and access to quality analysis and portfolio-building tools risk being left behind, Johnson warned.
This especially applies in the competition to win and serve highly affluent clients, she said.
Increasing use of alternatives in new channels is also important for asset managers themselves, Johnson said. That’s one reason that Franklin has acquired firms like Legg Mason and Benefit Street Partners in recent years, giving its clients access to “new and interesting opportunities” to deploy assets.
Wealth management professionals have many options to put alternatives to work for their clients, according to Johnson. Her personal favorite, she said, is the secondary private equity market.
Johnson shared this perspective during a live taping of The Compound and Friends podcast at the Future Proof Festival in Huntington Beach, California. She said she favors “secondaries” for reasons both cyclical and structural.
Why Secondary PE Stands Out
Secondary private equity involves purchasing existing stakes in private equity funds or direct investments from other investors such as limited or general partners. This market provides liquidity for existing investors who might need cash or want to rebalance their portfolios, Johnson noted. Conversely, secondary private equity offers buyers access to established, mature portfolios, often at a discount.
Unlike primary investments, secondaries allow for earlier cash flow and reduced blind pool risk because the underlying investments are already made, Johnson observed. She noted that these are attractive features for the wealth management market.
In addition, these funds are situated to take advantage of the phenomena created by ongoing market disruption. For example, forced selling by large institutional investors — such as pension funds needing to pay growing pools of retirees — has allowed secondary funds to purchase investments at historically large discounts to net asset values. This dynamic delivers immediate added value to their own investors.
No growth-oriented advisor seeking new high-net-worth clients needs to be convinced that their clients should have alternatives, Johnson offered.
“The question is how?” she said. “It’s also about suitability. Suitability depends on the client, and advisors must play the key role in guiding allocations. Education and due diligence are also critical. … Don’t just look at the product and put it on the platform. Ask what the manager is doing to help you educate clients.”
Franklin’s Evolving Leadership Team
During the interview, Johnson also addressed the recent announcement that she will be gaining three co-presidents at Franklin Templeton, effective Oct. 15. They are Daniel Gamba, the longtime BlackRock executive who was recently hired as chief commercial officer; Terrence Murphy, head of public market investments; and Matthew Nicholls, chief financial and operating officer.
“I’m excited Daniel has joined our firm in this pivotal role at a time when we are seeing growth across our business,” Johnson said. “He is a widely respected industry leader and brings extensive experience across asset classes and geographies, including public and private markets.”
Johnson added that Gamba's expertise aligns with Franklin’s mission and culture.
“Over the past several years, Franklin Templeton has accelerated its efforts to provide diverse investment capabilities across a broad range of clients around the world,” Johnson said. “I’m confident that under Daniel’s leadership, we will further strengthen sales, marketing, product development and customer experience to deliver the best possible investment outcomes for our clients.”
Pictured: Jenny Johnson
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