The purpose of a family office is to manage and protect the wealth of the family. This is not always a simple task to fulfil, as the wealth within a family is typically distributed between different family members and external mandates, and consists of a variety of asset types from the most typical securities to alternatives and assets of passion.
According to the Global Family Office Report 2016, an average family office portfolio consists of 50 % alternative investments, 25 % equities, 12 % bonds and 8 % cash or equivalent. Family offices usually face the problem that traditional investment management systems are strictly built for managing pre-defined asset classes only, such as equities, bonds, funds, and cash. Most of the systems are too rigid to handle alternatives such as real estate, venture capital and private equity, assets of passion, and other typical family assets, which happen to cover more than 30 % of the average family office portfolio. And according to the Global Family Office Report 2016, the proportion of alternatives is still increasing.
Alternatively, a family office may have multiple systems and reporting tools to cover all the asset types. But this is cumbersome and expensive and leads to them having to run or outsource an IT department to take care of these systems. And is it really a consolidated view if different asset types are handled with different tools?
And yes, the consolidated view is crucial. It is a necessity to prosper, for predictability and succession planning – which is of course required to preserve the wealth and ensure the welfare of succeeding generations. To put it simple, to be able to fulfil the purpose of the family office as described in the beginning of this article.
Another headache is reporting. Again, the need for a consolidated view of assets is apparent and goes hand in hand with the ability to provide consolidated reports. As reports provide the family with a clear view and a solid base for major investment decisions, it surely needs to be accurate and extensive, but also efficient to produce at will. Furthermore, regulatory reporting burden is also taking its share of the resources of a family office and is expected to increase.
Most of the systems are too rigid to handle alternatives such as real estate, venture capital and private equity, assets of passion, and other typical family assets, and those cover more than 30 % of the average family office portfolio.
Our mission is to provide family offices with a platform for comprehensive wealth management. Our platform enables you to gain control over your family’s wealth by bringing everything into one, top-modern and highly secure system – not only the most common securities but also real estate, private equity, assets of passion, philanthropy, and so on.
In addition, FA is a platform that is able to aggregate and store data from your external mandates and enable you to easily monitor and compare their performance and fees. Of course, the information is also easily processable, analysable and reportable, e.g. enabling the automation of consolidated reporting procedures for family members, authorities and other stakeholders.
For a family office, the traditional way of doing things – buying an expensive software license, running a big software project and maintaining own IT department – is too heavy, cumbersome and inflexible. We offer our platform as a service based on a monthly subscription, enabling the running of your business anytime and anywhere with any device, as the only “IT” you and your family members need is an internet connection and a device to browse the internet.
This enables you to manage the wealth of your family consolidated in a single system for precise monitoring, efficient reporting, and successful long-term planning for the benefit of your family.
I’m not saying whether running a family office is unbearably easy or not, but the right kind of software will greatly lighten you burden.
If you wish to hear more how we can help your family office, just leave your email address below and we will be in touch.
* The Global Family Office Report 2016 surveyed principals and executives in 242 family offices, a majority of them (75%) being single family offices. The average AUM of participating family offices was USD 759 million. The geographical breakdown was as follows: Europe (40% of respondents), North America (32%), Asia-Pacific (19%) and Emerging Markets (9%).