NorthBridge Financial is a mid-market diversified financial services firm with three operating divisions: capital markets, investment banking operations, and wealth management. The company generated $2.4B in revenue last year and operates primarily in North America, where it is a strong subscale player versus bulge-bracket banks and large wirehouses. Its capital markets business serves institutional clients in equities, fixed income, and financing; its investment banking operations division provides execution support, middle-office processing, and advisory workflow services; and its wealth management arm serves affluent and high-net-worth clients through 1,200 advisors. The CEO has asked the strategy team to determine where NorthBridge should focus incremental investment over the next 24 months.
NorthBridge cannot fund all three businesses equally. Capital markets has rebounded with higher trading volumes but remains cyclical and balance-sheet intensive. Investment banking operations is lower margin today but offers recurring, service-based revenue and potential technology leverage. Wealth management is the fastest-growing division, but competition for advisors and client assets is increasing. The board wants a clear recommendation on which business should be prioritized for growth, what role the other two should play in the portfolio, and how the firm should position itself against larger competitors.
| Business | Revenue | EBITDA Margin | 3-Year Revenue CAGR | Capital Intensity | Notes |
|---|---|---|---|---|---|
| Capital Markets | $1.05B | 18% | 4% | High | 62% institutional client concentration; revenue volatility tied to market activity |
| Investment Banking Operations | $420M | 11% | 7% | Medium | 88% recurring contracts; 94% gross client retention |
| Wealth Management | $930M | 24% | 11% | Low-Medium | $185B client assets; net new assets growth 6% annually |
Additional facts:
You are advising the CEO and board.