Family Offices for Searchers: A Primer

You also like, as a family office entity, you're on all these different lists, right? Just by the nature of your business. So every hedge fund, private equity fund, real estate fund and VC fund is going to be sending you cold emails.

So I mean if you open up your email in this seat, any, any allocator seat too, if you worked at a pension or whatever too, you get it too. But there's just a huge amount of inbound. So half the job is like just swatting away, you know, it's like, no, no, no, no, no.

Like what do we, what do we care about? What is the ideal setup? What are the industries we want to play in?

What. Let's think about how to go proactively, go get those. And some families do a great job of doing that and have amazing sort of direct investment teams doing that and they're able to source and they can go to conferences and they can find operators and build relationships and build platforms and all that. Some have a more difficult time doing that and are kind of stuck playing deep fence.

And overall the orientation with respect to capital growth is. I thought I would have guessed that it's more conservative because it's like we've made, the family has made all this money. We're already extremely wealthy.

You know, priority number one is don't lose it as, as opposed to grow it as well as we can. Obviously anybody sitting on money wants to grow it, but I would just think that versus private equity, they would just be more conservative financially. Um, but I'm actually not getting that from you or what would you say.

It all, it all sort of depends, right? I mean it depends on the risk appetite of the, of the principals, of the families. None of them are the same. And that's what you hear this expression.

Once you've met one family office, you've met one family office. Like they're so different because they were created for the specific needs of an individual or a family. They are inherently custom built entities.

So that means definitionally none of them should be the same at all. So some people are going to want to like, you know, swing for the fences and really compound capital. Some people like I want to be in treasuries and whatever.

I think for the most part when you have a certain quantum of capital it only makes sense to have a small portion of that be in higher risk stuff. Right? I mean that's why there's a small allocation to venture or higher, higher risk stuff. So in, in any case there's going to be like a certain amount of money that wants kind of, you know, alternatives.

If you have all your money in t bills or even you know, whatever mutual funds and ETFs, you know, that's obviously if that helps you sleep at night as a family or as a principal, like that's great. But I think for the most part there, there is a desire to have an allocation to alts and specifically to privates, either PE funds or directly into businesses.