The Rise of a New Investor Majority
By 2025, Gen Z and Millennials together represent the largest and fastest-growing segment of retail investors worldwide. They are no longer just “the future of investing”, they are an active, decisive force influencing capital flows, market narratives, and even corporate strategy. In Asia-Pacific, they account for over a quarter of the consumer base and are entering their prime earning and investment years reshaping everything from asset allocation trends to sustainability priorities.
Unlike previous generations, this cohort enters markets earlier, invests with a dual lens of returns and purpose, and adopts digital-first, AI-assisted tools at a pace traditional finance is still catching up with. The World Economic Forum reports that around 30% of Gen Z started investing while still in university or early adulthood, compared to much lower rates for Gen X or Boomers at the same age. Even more telling, 41% would be comfortable letting AI manage their investments, underscoring their openness to automation in decision-making.
This surge of early participation and tech adoption has implications beyond retail markets. It influences how family offices prepare for succession, how private equity communicates its value, and how capital markets package access to high-growth themes. The challenge and opportunity for investment managers is clear, align product design, distribution, and messaging to meet the values, risk appetites, and access expectations of this new investor majority.
The Moment: Younger, Earlier, Digital-First
A structural shift is underway, rising living costs are forcing pragmatism, but not passivity. Bank of America’s 2025 data shows 72% of young adults are actively taking steps to improve their financial health, from budgeting apps to side hustles to first-time market participation.
These investors are also far more platform-agnostic than their predecessors seamlessly moving between fintech apps, social media, and traditional brokers. Yet the CFA Institute warns of a credibility gap: 82% of social-media-influenced investors act on advice they find online, but only ~2% of financial influencers are registered or licensed. This creates a high-trust, high-risk environment where transparency becomes a competitive advantage.
The Mindset: Independence Over Employment, Purpose With Payoff
In a 2025 Harris Poll, 94% of Gen Z say they aim for financial independence before 55 and ideally by 32 as cited in the Morningstar. Many do not believe a conventional 9-to-5 will get them there. Instead, they’re blending entrepreneurship, side hustles, and investing into a personal wealth strategy.
Deloitte’s 2025 Global Gen Z & Millennial Survey reveals another defining feature: the integration of purpose and performance. Sustainability, inclusion, and resilience are not side criteria,they are core decision filters. For them, a “good investment” is one that delivers competitive returns and drives positive real-world outcomes.
Access & Asset Innovation
In 2025, one of the loudest frustrations among younger investors is the increasingly closed nature of high-growth opportunities. Many of the most compelling growth stories especially in sectors like climate tech, AI infrastructure, and next-gen manufacturing are staying private for a decade or more. This trend delays IPOs well beyond the point when much of the value creation has already occurred, effectively locking public investors out of early-stage upside that previous generations could access in listed markets.
Gen Z is not standing still in the face of this barrier. They are experimenting with creative entry points into growth themes:
- ETFs linked to emerging sectors, offering thematic exposure without the need to directly access private placements.
- Tokenized assets, which promise fractional ownership of previously illiquid opportunities, from real estate to pre-IPO equity.
- Community funding rounds and crowdfunding platforms that blend investment with brand engagement.
- Secondary marketplaces for private shares, where early investors or employees sell stakes before IPO.
Yet these solutions come with their own set of challenges. Tokenization and synthetic exposures, while marketed as democratizing tools, can easily overpromise access without truly delivering transparency. Key risks include unclear underlying ownership rights, limited liquidity, complex fee structures, and regulatory grey areas.
For investment firms, this presents a dual opportunity and obligation:
- Design products that genuinely bridge the access gap, providing exposure to private-market themes in a regulated, transparent, and liquid format.
- Educate investors about what they own, with clear, jargon-free disclosure on asset composition, liquidity constraints, and risk factors.
If addressed correctly, access innovation can move beyond a marketing hook to become a sustainable competitive edge, one that meets Gen Z’s appetite for growth without compromising on trust.
Why This Matters for Investment Firms
Gen Z and Millennial investors are no longer a niche, they are setting new benchmarks for how capital should be deployed, measured, and communicated. Their expectations are clear: digital-first accessibility, product transparency, sustainability as a baseline, and real access to high-growth opportunities.
For investment managers, adapting to this shift means:
- Innovate products for access and relevance – Develop semi-liquid, thematic investment vehicles that mirror private-market growth themes, from energy transition to AI-enabled industrials and critical infrastructure.
- Turn content into credibility – Deliver transparent, data-backed investor education that cuts through the noise and addresses the credibility gap in online financial advice.
- Make purpose measurable – Move beyond marketing claims by linking cash-flow drivers directly to climate impact, social outcomes, and resilience metrics.
- Engage the next generation of family office capital – Build governance programs, co-investment channels, and thematic learning tracks that prepare next-gen investors to participate actively and strategically.
By 2025, the line between “emerging” and “established” investor generations has blurred. Gen Z and Millennials are here, their influence is growing, and they are rewriting the rules of engagement. For those who adapt, offering access, evidence, and alignment, this is not just a demographic shift; it’s the most investable trend of the decade.
