So you want money from a family office huh?

A lot of people want to access the family office market . The reason is because they believe that it's an area which they can raise a lot of capital and often in a manner that is much easier. Although the check size might be bigger there's many many things that people don't realize when dealing with a family office. 

In my past I had the ability to raise capital from individuals to family offices to private equity funds, insurance companies and institutions. The biggest difference with institutions or institutional capital is that their decisions are typically made based upon parameters. They have a box or boxes in which they are to invest into. In addition, it's not their own money so because of that they are often removed from any emotions. Sure they want to do a good job but let's face it its not their own money!! 

Family offices, however are different. I would say that family office investors are much more like individual investors. In many ways very similar to that person that just retired and has an IRA with $200,000 to invest, and they need to make a decision on where to put their money. Yes family offices have a lot more money to invest however the same applies to a family office as it does to an individual who has $200,000 to invest.  That money is what they have after they've worked their whole life in order to amass that amount of money.  Because of that they need to make sure they feel comfortable that they're making the right decision. The problem is that although they understood their industry perhaps they were in for the last 30 or 40 years,  they do not understand hedge funds, nor mutual funds,  insurance products,  private equity investments or perhaps even real estate investments. Sure they might understand some of the types of investments,  but not to the extent that one would think. That, combined with the fact that it  took their lifetime to build that wealth, they are wanting to make sure that they make good decisions, especially because unlike an institutional investor emotions get involved. This must be taken into consideration when dealing with family offices and from the points that I just mentioned above is why relationships are the most important thing when dealing with family offices.  They need to trust you and understand so that they feel what they have worked so hard for will grow and not be lost.