Family Office Resources
Why Family Offices Make Good Investors
Younger generations of family offices are looking to use their money for more good in the world. Also known as impact investing, this new generation of wealth is functioning differently than their parents and even grandparents before them: They’re more mindful about how their investments impact the environment, small businesses and even future generations. They’re looking to not only fund businesses and philanthropic ventures, but to find the value of investing their time and emotional energy in addition to the actual financial funding of a project.
Wealthy Families Have $4 Trillion Up for Grabs
In December, a half-dozen of some of the richest families in the U.S., from agriculture to beverages, gathered in a conference room on the 10th floor of an office building in Miami.
This was not some cabal to rule the world. Instead, for an hour over coffee and bagels they listened to a dealmaker for billionaire brothers J.B. and Tony Pritzker talk about how to buy companies.
Wealthy families are embracing their inner Warren Buffett, albeit on a smaller scale. They used to hand most of their assets to managers to invest. Now, following the likes of Buffett, Michael Dell and Bill Gates, many are acting like private equity firms, buying large stakes in companies or acquiring them outright. Families can exert tighter control over their money, give the kids something to do and cut their deal fees.
How to Overcome Objections from a Family Office
Today’s family offices are looking to invest in opportunities they believe in. This is happening more often than with previous generations of wealthy families who focused more on the profitability of their investments. Some modern family offices are using a different set of criteria than their parents and grandparents, investing in projects that are of personal concern to them. And it’s not always clear cut how they’re making those investment decisions.
How Family Offices Invest
Bill Gates’ and Prince al-Waleed’s investment in the Four Seasons brings to light the amount of wealth and investment capital held by family offices globally and their approach to investing.
Over $4 trillion is managed by this distinct set of entities set up to manage the assets of wealthy families ranging from the self made to generational and from the low profile and informal to the well publicized and institutionalized.
Investing in Startups
Family offices are seeking direct investment opportunities that offer better returns than the public market and, therefore, investing in startup companies through longer-term private equity deals.
2018 Family Office Outlook
Spurred by continued wealth creation, globalization of businesses and investments and continued concentration of wealth, family offices have continued to proliferate worldwide. In 2017, Handler Thayer attorneys attended and conducted presentations at thirty tax, estate, family office and wealth management conferences in addition to conferences and lectures sponsored by professional associations, private companies and television and radio programs. Handler Thayer also hosted its own Third Annual Family Office Private Capital Forum on June 21, 2017 that examined how family offices approach the world of private capital investing. Based on these educational conferences, industry research, direct client experience and other observations, here are the firm’s predictions of top trends for family offices in 2018:
How New Wealth & Few Rules Fuel Family-Office Boom
What do family offices do? Who has them? How are they regulated? What’s next for family offices?
Family Office Activity Indicates UHNW Markets
Single-family offices (SFOs), the ultra-private organizations that help the world’s wealthiest families oversee their financial affairs, are often viewed as leading indicators for the broader HNW and UHNW markets. Reportedly more UHNW Investors are looking to make direct and alternative investments.
A Practical Example of a Family-Office
To give you a practical, real life example of what a family office is and why they matter, you need to look no further than Steve Jobs, the American founder of Apple Computer and Pixar, who created a “first generation family office” based on his genius, drive, and creativity.
When Steve Jobs died in 2011 due to complications from a relapse of his previously treated islet-cell neuroendocrine pancreatic cancer, his wife, Laurene Powell Jobs, inherited $17.6 billion from the Stephen P. Jobs Trust to become the fourth-richest woman in the world and the 49th wealthiest person on the 2016 Forbes annual list of world billionaires.
Jony Ivy’s short seven minute eulogy in which he describes the “bold, crazy and magnificent” ideas that Steve Jobs inspired embodies the vision and mission that we hold dear at our firm. You can view the eulogy by clicking here.
Marketing an emerging hedge fund to UHNW Investors?
Single-Family Offices And The Ultra-Wealthy Are The Keys To Raising Capital For Smaller Hedge Funds. This Forbes article has great advice on capital raising opportunities.