Family Office Navigator

Why families consider setting up a family office

Family Office Navigator | 35

There are many reasons why families think about setting up a new family office or repurposing an existing one. For some, a family office becomes an obvious next step after a liquidity event such as the sale of a business. For others, a family office is created out of the desire for more control or independence from financial institutions or to achieve better investment outcomes. Beyond these initial triggers, there are many other motivations for having a family office, such as to protect family privacy, to foster family unity, to develop family talent, to support intra-family ownership and leadership succession, to offer tailored services to the family or to support family and ownership governance. For a few, it’s a status-driven pursuit. For others, it’s a vehicle for multigenerational wealth preservation. For many, it’s a combination of different reasons. Next, we will present the primary reasons why families establish a family office based on our research and work with enterprising families. As you read through them, we recommend that you and your family spend time together and reflect on which apply to you. Why are you interested in a family office for your family? Why is your family interested in creating one? Have an open and honest conversation with your family members because these reasons can vary from person to person. This exploration is the first step toward ultimately defining the purpose of your family office, so it is important not to skip this activity. Make a note of the ones that apply to you and your family members because we will return to the significance of these factors in the next chapters.