Family office

from Wikipedia, the free encyclopedia

The term family office comes from the English-speaking world and describes a company whose purpose is to manage the large private wealth of an owner family. In principle, however, the tasks of a family office are not restricted. In addition to pure asset management , it typically takes on other classic secretarial services such as mediation , bookkeeping , office organization, travel planning, security management, controlling and the like. the client.

Tasks and demarcation

The main difference between a family office and an asset manager is the fact that the former is under the control of the investor family and the latter is under the control of a third party. The regulation also differs accordingly: an asset manager needs the approval of the regulatory authority, while this is not the case with the family office - at least if the unanimity principle is laid down for the shareholders' meeting. Due to the identity of the investor and owner of the family office, the legislature assumes that there is no need for protection. The investment decision-makers are employees of the family office and thus subordinates of the investors. In addition to risk diversification, it is often also important for the owner families to maintain entrepreneurship within the family with their family office. Similar to private equity firms , family offices also invest in established companies and startups via direct investments . The holding period for direct investments is, however, significantly longer for family offices, averaging 19 years, than for private equity.

The main advantage of the family office is that the family has a high degree of control over their own assets and investments. In certain circumstances, cost savings can be another benefit. Since the investor and owner are identical, no management fee has to be paid; only personnel and external costs are incurred. The disadvantage is that a family office that is only responsible for one family is only worthwhile with a certain minimum wealth of around EUR 250 million. A family office only pays off if the management fees of an external asset management company are noticeably higher than the personnel costs that you have to pay for a minimal family office. The costs for a family office with full service are at least one million EUR per year, of which around 60 percent are personnel costs. Lower costs can be achieved through very lean structures, so-called virtual family offices.

In addition to this family-owned form of organization, which is often specified under the term Single Family Office (SFO), the term is now also used to advertise services by companies or departments of banks that provide financial services for the same customer group. Regulation is required for this activity, as it is ultimately just a promotional label for conventional banking services such as financial portfolio management and investment advice.

backgrounds

Originally, very wealthy families founded their own family companies in order to optimally manage their private and business assets and obligations . The first family office was the House of Morgan , founded in 1838 by the American entrepreneurial dynasty Morgan. In 1882 the family office of the Rockefeller family was founded .

According to the US consultancy firm Celent, there are over 4,000 companies in Europe that provide family office services, 750 of which are exclusively dedicated to the business of a single family, for example Jacobs Holding in Switzerland. Each of these single family offices manages fixed assets of at least 100 million US dollars , with the recommended minimum size for a single family office being at least 500 million Swiss francs . There are at least 300 single family offices in Germany, most of which were founded in 1970.

So-called multi-family offices work for several families and usually manage smaller assets. There are said to be almost 2,000 in Europe , serving an average of ten to 15 customers with a portfolio of 25 to 50 million US dollars.

In Switzerland , which is considered the center for family offices in Europe, there should be between 300 and 400 family offices, which mainly look after foreign clients and employ an average of 20 people. A dozen of them manage individual assets of 10 to 15 billion US dollars each.

Commercial and private banks have increasingly begun to attract customers with in-house multi-family offices . The independent family offices accuse these banking business units of not having the necessary distance when making investment decisions and, above all, of being keen on commissions. Independent offices, on the other hand, have different incentive systems and charge more strictly according to expenditure, not as a percentage of investments or profits .

literature

  • Steen Ehlern: Global Private Wealth Management: An international study on Private Wealth Management and Family Office Services for Ultra-High Net Worth Individuals . London 2006.
  • Felix Haupt, Thomas Hilger: The Family Office: Integrated Service Provider or Strategic Consultant? . Research paper No. 113 , WHU - Otto Beisheim School of Management, 2006.
  • Florian Richter, Jan Eiben: The family office manager - requirement profile and institutional economic analysis of his relationship with the owner family . Research paper No. 123 . WHU - Otto Beisheim School of Management, 2009.
  • Maximilian A. Werkmüller (Ed.): Family Office Management as a (banking) service for wealthy private customers . Heidelberg 2009. ISBN 978-3-936974-83-6 .
  • Dirk Farkas-Richling, Thomas R. Fischer, Andreas Richter (eds.): Private Banking and Family Office: Business Models - Products - Law and Taxes . Schäffer-Poeschel Verlag Stuttgart. 2012.
  • Kirby Rosplock: The Complete Family Office Handbook: A Guide for Affluent Families and the Advisors Who Serve Them . John Wiley & Sons, Inc., Hoboken, New Jersey. 2014.
  • Philipp Bierl, Antonia Schickinger, Max Leitterstorf, Nadine Kammerlander: Family Office, Family Equity and Private Equity - Entrepreneurial Investing and Cross-Generational Entrepreneurship . Vallendar. 2018.

Web links

Individual evidence

  1. ↑ Definition: Family Office . In: Gabler Wirtschaftslexikon Online . ( gabler.de [accessed on July 27, 2018]).
  2. ↑ https://www.bafin.de/SharedDocs/Veroeffnahmungen/DE/Merkblatt/mb_140514_familyoffices.html Section 1
  3. ↑ https://www.bafin.de/SharedDocs/Veroeffnahmungen/DE/Merkblatt/mb_140514_familyoffices.html Section 4 b)
  4. ↑ https://www.bafin.de/SharedDocs/Veroeffnahmungen/DE/Merkblatt/mb_140514_familyoffices.html Section 4 a)
  5. ↑ Norbert Hofmann: The good grasshoppers . In: sueddeutsche.de . 2018, ISSN  0174-4917 ( sueddeutsche.de [accessed December 28, 2018]).
  6. ↑ Norbert Hofmann: Exclusively for the family . In: sueddeutsche.de . 2018, ISSN  0174-4917 ( sueddeutsche.de [accessed December 28, 2018]).
  7. ↑ Christina Anastassiou: Mittelstand in the focus of family office asset management . In: THE WORLD . March 21, 2017 ( welt.de [accessed December 28, 2018]).
  8. ↑ Study reveals: What does a family office cost? | private-banking-magazin.de . In: private-banking-magazin.de . ( private-banking-magazin.de [accessed on April 28, 2018]).
  9. ↑ Family Office, Family Equity and Private Equity - Entrepreneurial Investing and Intergenerational Entrepreneurship. Retrieved December 28, 2018 .
  10. ^ The money machines of the super-rich , balance sheet , July 28, 2004
  11. ↑ Information on the authorization requirement according to KWG and KAGB for family offices. Retrieved on July 27, 2018 (German).
  12. ↑ a b Julia Böhme: The royal route. Family office. In: Cash. Invest like the pros , No. 11/2017, pp. 84–88, here p. 85.
  13. ↑ From our business correspondent in western Switzerland: The family office as the butler of the rich | NZZ . In: Neue Zürcher Zeitung . January 8, 2009, ISSN  0376-6829 ( nzz.ch [accessed July 27, 2018]).
  14. ↑ Heterogeneity of Single Family Offices - Unternehmeredition.de. Retrieved December 28, 2018 .
  15. ↑ What is a family office? | Monetaris . In: Monetaris . April 24, 2018 ( monetaris.de [accessed July 27, 2018]).
  16. ^ The family office as the butler of the rich - discreet business with billions of dollars , Neue Zürcher Zeitung , January 9, 2009