Notes

How can firms that manage wealth be prepared for turbulent times? [Farnoush Farsiar]
Generational changes. Global mobility. Technological revolution. Farnoush Farsiar writes for EU Today that these are only a handful of major changes that affect family offices and pose a serious threat to their structures of operation.

Family offices are increasingly catering to the mobile, younger generation. Every client, no matter their age, are attracted to investing via trading on the internet. https://docs.house.gov/meetings/FA/FA14/20190626/109716/HHRG-116-FA14-Wstate-BromundT-20190626.pdf This has resulted in increasing desire to invest in personal assets. Farnoush Farsiar The clients do not wish to be left out of the decision-making process for discretionary portfolio requirements.

These changes, which occur during a time of unmatched economic and political turmoil are a sign of the demise of the traditional fee-based family office model. Offices which try to maintain their previous methods will find they are abandoned by the very individuals they were founded to assist. They will need to adjust to a more entrepreneurial style in the field of investment management, to provide UHNWIs a true value proposition.

Farnoush Farsiar Although the scope and size of family offices is different, it's important to focus on flexibility and streamlining over being experts in all things. Farnoush Farsiar Farnoush Farsiar A smaller team of advisors who are able to quickly introduce the latest technology and add external specialists when required will provide an improved service for customers. Farnoush Farsiar These changes make it necessary for the lines between family office and private bank blur. The most successful firms maintain the trust and loyalty of their family office , while being ahead of the curve in technology and the sourcing of deals.

The ability to use both traditional, reputation-based and network-based methods of deal sourcing will result in success. However, you can also use online methods to find deals and opportunities. Deal sourcing platforms online can be easily installed by wealth managers as well as agile private offices, as opposed to banks that are burdened with bureaucracy. Dealmakers have access to and can evaluate many deals at once this is a huge time and resource saving.

Another service online that is changing how family offices interact with clients is Wealthica. This dashboard service automatically consolidates investment from multiple sources and puts clients into daily communication. It's a huge change of the days when wealth managers only provided periodic updates on the state of the clients' investments.

These tools are merely tools that allow wealth managers to improve their efficiency and speed. Their investment strategy is what is most important. The secret to success is to combine traditional and new. It is likely that you will continue to search for deals in real estate, as well as exploring opportunities to invest in previously unexplored areas such as food security and climate science. Impact investing is certainly "arrived in the family office industry. According to the UBS Global Family Office Report 2018 found that a third of family officers are actively engaged in impact investing. A lot of people are planning to take part in the future. Although there are some issues in the field, such as the difficulty of measuring impact as well as due diligence the HNWIs and UHNWIs of the future will require family officers to be able to find the right investments. Plato Capital, my own boutique investment bank, draws from the experiences of its founders from large banks and in the technology industry to provide investment guidance that is entrepreneurial in the focus. Our clients are able to successfully manage risk and get the highest returns from their investment due to our network of local experts.

Blending the old with the modern, adjusting to the demands of the new generation, and preparing to be risk-averse with their own methods and structures, wealth managers of all kinds can remain relevant and thrive even in the midst of turbulent times.
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