Family offices are not built the same

From conservative allocators to bold venture capitalists

7 investment blueprints: 1/ 🪄 The Legacy Steward:

Endowment Portfolio Archetype

- 3rd, 4th gen+, $3B-$5B+ AUM
- Pursues endowment-like structure
- Prioritizes max diversification & asset retention
- Protecting wealth major focus

Real-life example: Cargill & MacMillan Family Office

Just released:
the latest comp packages at family offices

Are you wildly overpaid or chronically underpaid CEO/President

How family offices around the world incentivize their people

A look around the world

the leaders
the laggards
the surprises

→ USA
→ UK
→ Europe
→ Asia
→ Middle-East USA:

> leading the world in long-term incentive plans
> strong on co-investing opportunities
> carried interest a feature of the US sector

Where are family offices located:

→ the one city dominating European family offices

→ the Asian locations playing catch-up with Singapore

→ the Middle East country with 76% of the region's family offices

→ the powerhouse US state for family offices and its rising star

👇 Europe:

The UK is dominating the family office scene with 62% of European family offices reporting the UK as their primary location

85% of UK family offices are based in London
15% are mostly spread across Jersey, the Isle of Man, Berkshire, Buckinghamshire, Cambridge

How to close more deals with:

- family offices
- PE
- VC

Implement a proactive due diligence strategy

The steps you should take: ⏬ 1/ 🚨 Disclose potential conflicts and risks:

Be upfront about any issues or risks that may impact the deal

Any skeletons in the closet will be discovered during DD, so it's better to be open and transparent from the outset: It establishes trust and ultimately saves time

Family offices - latest hiring and comp data:

→ How many family offices are hiring
→ What areas are family offices hiring for
→ Staff turnover
→ The recruiting challenges
→ Compensation plans
→ Planned bonuses

Survey results 👇 53% of FOs are planning to hire in 2023

The areas FOs are hiring:

Never bet against America 🇺🇸

Family offices across the globe agree

Family office investment destinations by numbers:

How to set up a family office

The practical steps: 1/ Evaluate Resources

Is there enough money?

An honest assessment of the family's financial assets and wealth should determine if resources are sufficient to support a family office

If you have less than $100 million AUM, keep reading...

Some say a mere $100 million is not enough to establish a family office, but this is not always true

The circumstances where a family office could still make sense: > You have a particular set of skills

Family offices can be expensive with typical annual costs running to 0.5%-1% of AUM

But if you and your SFO team have specific skills to consistently generate outsized returns in a particular field, the costs can be justified

Let's get back to basics:

what is a family office
how much do you need to form a family office A single-family office (SFO) is a private wealth management firm supporting a single affluent family

It manages investments, tax planning, legal support & other financial matters

Core roles:

1/ Protecting wealth
2/ Financial Planning
3/ Succession Planning
4/ Administration

This is getting serious.. 10k followers 🙏

Twitter is wild
I love you all
Still need a sarcasm font

To celebrate, three recent threads 👇

- family office asset allocation
- family office resources
- what family offices do, day to day

What do you want more of? Family office asset allocation:

https://twitter.com/MrFamilyOffice/status/1657359105902690308?s=20

Let's get down to brass tacks...

the $ comp at family offices:

• CEO
• CFO
• CIO
• COO
• Legal Counsel
• Portfolio Managers
• Investment Analysts
• Controller
• FD
• Tax Director
• Accounting Director
• Head of Security
• CTO
• Family Liaison
• EA

👇 Chief Executive Officer - Non-Family Member

• Total cash compensation (base + bonus)
• Total direct compensation (base + bonus + long-term incentive)

Family office investment portfolios

The 7 archetypes: 1/ 🪄 The Legacy Steward:
Endowment Portfolio Archetype

3rd, 4th gen+, $3B-$5B+ AUM
Pursues endowment-like structure
Prioritizes max diversification & asset retention
Protecting wealth major focus
Real-life example: Cargill & MacMillan Family Office

Ten of the world's leading hedge funds

How they operate and how much you need to invest: Hedge funds are privately managed investment funds for institutional investors / HNW individuals

- Complex investment strategies: short-selling, leverage, derivatives, alternative assets
- Lightly regulated
- Targeting outsized returns
- Actively managed
- High fees

Day-to-day what’s actually happening in a family office:

1/11 1. Business Management:

The bread and butter of running any business…

- Resolving employee issues and ensuring a stable operation
- Managing cash flow and other financial needs
- Handling administrative tasks related to the office's operations

Where to learn about family offices

A thread covering the best family office resources: Campden Wealth:
Information and networking platform for family offices and wealthy families. Online resources include research articles, industry news, and white papers on various aspects of the family office sector

campdenwealth.com

The Family Office Dashboard: the financial nerve center

Dashboards track assets in real-time and report financial performance. They also help manage an array of family office tasks

So what is a dashboard and what does it contain?

The 10 functions of a FO dashboard: 1. Portfolio management:

• Asset allocation tracking
• Investment performance monitoring
• Risk analysis and mitigation
• Tax and regulatory compliance

18 of the best books to teach kids about finance

From toddlers to teenagers, jumpstart your kids' financial education📚

The Four Money Bears
Mac Gardner (2015)
Ages 3-7

Themes: saving, spending, investing, and giving. Bears work together to teach basic finance concepts Moneybunny series
Cinders McLeod (2021/2022)
Ages 3-7

Themes: rabbits learning financial lessons and basic financial concepts!

Best of all... the currency is carrots 🥕🥕

Corporate governance: not sexy, but essential

Failures in corporate governance can be fatal when you're:

- building your own business
- directing an organization (incl. family offices)
- conducting due diligence on a target company

13 corporate governance red flags: 🚩 1. Lack of transparency: Inadequate disclosure of information, decision-making processes, or financial reporting

Example: Enron's collapse in 2001 was due in part to its complex financial structure and deceptive accounting practices, which concealed massive debt and losses

10 of the richest families in India 🇮🇳

Indian families are turning to family offices to protect and grow their wealth

Here are the families that are flying high ✈️🚀 #1. Adani family

· Net worth: ~$109.5 billion, India's richest family
· Adani Group: multinational corporation, headquartered in Ahmedabad
· Founded by Gautam Adani in 1988
· Focus: port improvements in India

In Q1 we had 2 deals fall through at the due diligence phase

If you want to work with family offices, here’s how to get out in front of the due diligence process: 1/ 🚨 Disclose potential conflicts and risks:

Be upfront about any issues or risks that may impact the relationship or investment. Any skeletons in the cupboard will be discovered during due diligence, so it's better to be open and transparent from the outset