A family office is a privately held company that handles investment management and wealth management for any wealthy Individual family. Generally, a family office operates with around $100 million in investable assets, with the goal being to effectively grow and transfer wealth across generations.
There are many forms & types of family offices. And slowly these family offices are getting more complicated, the most common types that we see are investment Family offices, staffed by investment professionals, or professional offices, staffed by lawyers, accountants and administrators.
Family Office Types
Multi Family Office – Investment
These are Family offices dealing with more than one family & hence Multi Family Office. This is usually a small to mid-size boutique Investment Family office.
Multi-Family Office – Professional
This type of family office
is created to manage & support professional investment services of multiple families, hence Professional Multi Family office. These MFOs (Multi Family Offices) manages a wide range of services like Administration services, Trustee Services, Governance (Family & Corporate), Managing Philanthropy, Wealth & Succession Planning, Overseeing, Co-ordinating & Managing Assets / Wealth.
Setting Up A Family Office
There are multiple reasons why, a family would set up their family office .
Some of the most popular reasons to set up a family office are Control, Confidentiality, Discretion, Dedicated Staff, Independence, Trust & Accountability.
Investing By Family Offices
Investments made by Family Offices are quite diverse & unique in nature. As the investment decision solely rests with the family, so it is always in assets & wealth options which the family is quite aware of & they understand. Over the years, Private Equity & Luxury Assets are two key areas of interests for family offices .
But recently, investments in Crypto Currencies & Niche Asset Class has started increasing.
Family Office Life - Cycle
As setting up and managing a Family Office is getting more & more complicated, even the life cycle of a Family Office has grown to be more complex & requires a set of dedicated professional staff.
But over the years, family offices have managed to follow a few stages or phases, mainly because the Family tends to go through these phases & so does the family office managing their assets & Wealth
Life Cycle Phases include:
• Business Family
• Wealthy Business Family
• Diversified Wealthy Business Family
• Shifting of Wealth
• Multi- Generation Family