Best Ideas From Successful Offices

In our research of the family office industry over the years and from reviewing materials from books, publications and meetings, this seems to be the list of what the most successful family offices are doing and what they have learned through experience and the school of hard knocks.

1. Qualitative--more important than Quantitive

2. Allocation, design and following discipline is critical to justify fees

3. Institutional money management is important in terms of complexity and sophistication

4. Move to outside expertise to justify objectivity

5. Built in incentives for employees from stock, options and regular bonuses to reduce turnover

6. Move as close to 100% open architecture as possible to keep conflicts of interest at a minimum

7. Relationship manager with support team is correct business model. Client demands want simplicity of speaking to only one person to handle problems or opportunities

8. Keep advisors away from product. They must spend their time matching outside services/firms for clients needs to solve problems.

9. Value added services must be unique and holistic

10. Expand concierge services. It may make the difference of picking up a $100-250 million client

11. Closely held business services. From hiring key people to the final sale of the business

12. Alternative asset classes. Because of recent asset opportunity changes, clients now want between 15-35% of their portfolios here. However, big demand for automatic risk management because of current market conditions. Liquidity through regular cash flow is important.

13. Expert outsourcing partners. Besides hiring of personnel, this is right up there for several reasons: client demands want total objectivity from family offices and to manage future growth of this category

14. Asset management returns--Has to be measured on a risk adjusted basis and has to be communicated up front and on a going basis to clients in order to retain assets.