As a single family office grows to serve multiple generations, it often faces challenges meeting the diverse needs of a large, extended family. At a certain point, it can make strategic sense to join an established multi-family office. Here are key reasons why:
- Expanded Expertise - A multi-FO has expertise across more family office capabilities than a single FO likely possesses internally. Deep skills in investments, tax, estate planning, philanthropy, concierge services, etc.
- Operational Efficiency - Centralized operations, institutional partners, aggregated buying power and specialized departments of a multi-FO create economies of scale.
- Enhanced Technology - Multi-FOs continuously invest in next-gen tools, cybersecurity and integrated systems - hard for a single FO to match.
- Customization - Though serving multiple families, a multi-FO assigns dedicated teams and customizes services to individual families' needs.
- Conflict Mitigation - An independent multi-FO can objectively mediate family conflicts that may challenge an embedded single FO.
- Objective Governance - Governance, policy setting and family communications facilitated by an independent multi-FO may be received more openly.
- Transition Planning - A multi-FO provides continuity for the single FO when key leaders retire or transition out.
- Independence - Family members who want to manage a portion of wealth independently can do so via the multi-FO umbrella.
Here’s the kicker: the single family office model remains a great fit for many families. But for those facing the challenges of scale, complexity and family evolution, joining forces with a multi-FO can provide the best of both worlds. Reference: https://www.forbes.com/sites/andybusser/2023/07/27/is-it-time-to-rethink-your-single-family-office/?Poe-Language-Code=en&sh=5dd244414c61