'The Family Office Conundrum' contd.

May 2022

Hello, and welcome to this month’s premium edition of Family Office Insider (FOI) from Global Partnership Family Offices (GPFO).

This edition is a special edition featuring in-depth discussion from the most recent Family Office Solutions (FOS) session. Frederick Gieschen, Taz Sherwani, and Guy Ropner discussed the topic ‘The Family Office Conundrum’ in a session chaired by Dr. Michael J. Oliver.

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A full recording of the session is available at the base.

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Introduction

The session was inspired by this article written by one of our speakers, Frederik Gieschen, carrying the same title, and our intention was to explore some of the related issues, and in particular 'Why would you want to work in a family office?'. 

"Let me pitch an investment job to you manage a pool of patient capital with a goal of long term compounding, a flexible mandate that doesn't constrain your curiosity and creativity. You can go where you see the most attractive risk reward. No heckling by investors, no need for quarterly letters or unwanted publicity for your returns, no risk of key accounts suddenly pulling their capital. Oh, but also, you have one client that may fire you at will based on your performance, or because they've lost trust in you. Or because unfortunately, they don't like you anymore. It's unlikely but possible that someone's migraine, or conversation at the country club kills your latest venture or even sends you packing.”

Frederick Gieschen: Frederik graduated from the Universität Mannheim and began his career at Macquarie Group in New York. He worked on the investment team at two New York-based family offices before covering private credit at the investment consulting group Aksia. He currently writes a newsletter with profiles of investors and entrepreneurs and consults for investment managers and fintech companies.

Frederik: “The article was based on a little bit of my own personal experience in the space. Every family office is different.”

Frederik explored a number of themes, including what employees wanted from working in a family office. He said that they want challenging and interesting work; they want to grow in their career and they want to have some semblance of stability and a career trajectory. In addition, they probably want to be visible among their peers. Among the many questions, two key questions which stood out were:

• How do family office executives create job security?

• Is there an incentive to create what might be called ‘switching costs’?

Taz Sherwani: Taz heads up the Wates Family Office, a 4th Generation Enterprise with its heritage in Construction and Real Estate. Alongside his day-to-day management role, Taz is very much focussed on portfolio management, tax and legal oversight, implementing wealth diversification strategies and planning for Next Generation transition. Prior to joining the Wates Family Office, Taz spent 20 years in global finance, management consulting and investing roles with Unilever, Accenture, Fidelity's proprietary investment arm at Eight Roads and was most recently CFO at Look Ahead.

Taz: “I find the world of family offices weird, it doesn't suit everyone, and I find it attracts a certain type of person.”