Single and Multi Family Offices

Trevor L Taylor, a Miami private investor, founded Fortius Capital as a private investment vehicle. The distinction this entry covers sits one layer up, inside the world of wealthy families: whether a family runs a private office devoted only to itself or joins one that serves many families at once. Fortune put the difference simply, noting that a single family office serves one household while a multi family office may work with dozens¹. Everything else, from cost to privacy to the quality of advice, follows from that basic split.

Two ways to organize family wealth

A single family office is a private company owned by one family. It hires its own staff, sets its own budget and answers only to its owners. The general model is described in the entry on the family office. The appeal is control. The family decides which investments to pursue, how much to spend on reporting and security, and who may see its financial records. Fortune has reported that the population of single family offices passed 8,000 worldwide, with most founded this millennium, and that many high net worth households band together in multifamily offices to keep fees low² and reach investments they could not access alone. The same report pointed to Iconiq Capital, which manages money for a group of prominent technology founders, as one of the best known shared offices.

Spear’s, the wealth magazine, describes the single family office as full customisation at a cost³, and it cites Preqin data showing the number of family offices the firm tracks more than tripled in four years, with single family offices making up a majority. New single family offices keep appearing as founders sell businesses. Bloomberg’s family office newsletter reported that the founder of the private markets data company Preqin was focused on building a family office after selling his firm⁴, a common next step after a large liquidity event.

A multi family office reverses the arrangement. One firm employs the investment staff, tax specialists and estate planners, and several unrelated families buy access to them. The families gain institutional expertise without building it themselves, and they give up some say over how that expertise is organized. Many multi family offices began as single family offices that opened their doors to other families to share costs, which is why the two models often look alike from the outside.

In practice a client of a shared office usually works with a relationship lead who coordinates specialists behind the scenes: an investment committee that builds portfolios, tax staff who prepare filings across several countries, and estate planners who keep trusts and wills current. The family receives consolidated reporting on everything it owns, including holdings managed elsewhere. What it does not receive is a staff that works for nobody else, and that difference matters most during a crisis, when every client wants the same senior people on the same afternoon.

The arithmetic of cost and control

The case for sharing comes down to fixed costs. Institutional Investor reported on a survey by AlTi Tiedemann Global and Campden Wealth of nearly 100 single family offices that found average operating costs of $5.2 million a year⁵, before fees paid to outside managers. For a family with a few hundred million dollars, that overhead consumes a meaningful slice of returns every year. A shared office spreads the same staff across many balance sheets.

Advisers quoted by Fortune suggested that roughly $500 million in assets is a sensible starting point for a single family office, citing J.P. Morgan research that breaks offices into small, midsized and large tiers. Below that level, the economics usually favor a shared platform. Above it, the family can afford dedicated people and may value the privacy enough to pay for it.

Shared offices are not all alike. A Forbes column on the subject separates commercial multi family offices, which aim to profit from many clients, from private or closed ones shared by a limited number of families⁶. The commercial version looks much like a boutique wealth manager. The closed version behaves more like a club, where a handful of related or friendly families split the bill and keep the governance tight.

Multi family offices also move to follow their clients. Private Banker International reported that the multi family office founded by grandsons of the Adidas founder moved its base from Nassau to Miami⁷ and opened in Tampa. Family Wealth Report covered the London based Stonehage Fleming opening a representative office in the Brickell Avenue financial district⁸ to reach families in the southeastern United States and Latin America. Those moves are part of the story told in the entry on family offices in Miami.

The hybrid middle ground

The line between the two models keeps blurring. Institutional Investor described rising demand from families who are too small for a full single family office yet want more attention than a standard shared platform provides. Some outsource the back office while keeping a small investment team. Others hire a single chief investment officer and rent everything else. A third route is the virtual office, in which a family keeps only a coordinator on payroll and contracts out investment, accounting and legal work to separate firms that the coordinator supervises.

Privacy is the hardest thing to replicate in a hybrid. A family that owns its office controls who sees its balance sheet and its spending. Once it shares a platform, its records sit inside a firm that also serves other families, so the strength of that firm’s controls becomes part of the decision. Families with public profiles often weigh this factor above cost.

Single family offices also work together without merging. Bloomberg reported that Mousse Partners, the office that manages the Wertheimer family fortune behind Chanel, took a stake in the wealth adviser Rockefeller Capital Management alongside two other family backed firms⁹. Deals like that show offices pooling capital on a single transaction while keeping their own staff and identity, the practice described in the entry on coinvestment.

The choice also shifts over a family’s life. A first generation founder may start in a shared office, build a dedicated one after a sale, and then see grandchildren split into branches that each want something smaller. Planning for that drift belongs to wealth succession planning. In every case the practical test is the same: how much direct control the family wants for each dollar it spends on running the office, and how much of that control it is prepared to share.