Your Peer, Your Client, Your Boss, Or Your Friend?

Last week’s newsletter encouraged a lot of you to reach out and share stories about your own experiences entering and leaving the family office sector. One reader, who runs his own family’s investment office, emailed me to say that being both a family member and an operational leader is a blessing and a curse.

This got me thinking about how important the network really is for the modern family office leader. Peer to peer networking undoubtedly plays a huge part in the entire financial industry, but for family offices there is a key subtlety that makes all the difference. As one executive put it recently, running a family office is a strange role: In what other job are colleagues simultaneously your peer, your client, your boss, your friend, or even a relative? This can make it challenging to know where to go to complain or ask for help.

When you need someone to talk to about problems, be they portfolio related or otherwise, having a peer network group is invaluable — especially if that opens the door to face-to-face discussions with someone that is not your employer. The executive I mentioned above, who has run a large family office for many years, told me that it was something like trying to solve a puzzle: if you do it alone you only have one perspective, but if you ask someone else for help, you see it from a totally different angle. “I’m a big believer that the best decisions are the ones that have been debated and challenged the most,” he said.

And one of the best ways to develop these networks is through conferences. Family office peers come together alongside external advisors and quickly realize they are facing a lot of the same issues. At some of the II family office events I’ve attended, I’ve seen small, huddled groups discussing all sorts of things you’d never think would come up at an investment conference. For example: What does a CEO do if a family member suffers with addiction and is due to gain access to a huge trust in the coming years? Managing this is both incredibly personal and difficult. Finding someone who has been through a similar event in the workplace is no easy task — but in a room full of trusted peers it might be.

It also allows family office execs to debate in a constructive way and for seniors to coach those just entering the fray. “Having people that you can discuss things with, that you can share war stories with, that can help you look at things from different angles is really, really important,” said the executive. “Family office conferences have given me a peer group of people that I consider friends, who I can have those debates with and I can turn to when I want some advice.”