Some Family Offices Are Missing Direct Deals
 

Family offices are increasingly developing their direct investment capabilities and showing up for deals. But an inability to effectively communicate the value proposition that a family led buyout can bring means some are missing out on the best opportunities.

Data from both a past II conference and Citigroup in 2025 shows that around seventy percent of family offices planned to make direct investments in the year ahead. The long-term capital and flexibility that family offices have means they are well positioned to take controlling positions in companies and operate like small private equity funds.

For many, this trend is working well, with family offices originating and executing an array of highly sophisticated and institutional deals. But Hendrik Jordaan, an M&A attorney at Nelson Mullins who has been active in the family office space for much of his career, told me this week that some are missing out on potentially fruitful deals. 

The more sophisticated family offices understand what their idiosyncratic competitive advantages are, and that allows them to win deals when they compete against private equity.

But the less sophisticated family offices lack that level of insight, added Jordaan.

“Parties may agree on purchase price on day one but will miss fundamental governance, protection, deal structure, and optimization opportunities,” he said. “And as a result, families will either not win the deals that they otherwise could or leave themselves exposed in ways that they may not even realize initially.”

These are largely legal and structural. For example, Jordaan said many families fail to communicate to potential targets that the probability of an earn-out dispute or litigation is much lower when dealing with a family office, or that avoiding private equity can offer excellent long-term equity rollover value.

“If you sell to private equity then every four to five years it is more than likely that a new fund will enter the capital structure, and that means a brand-new tax event. It is massive, particularly when it happens four or five times over a 20-year period,” said Jordaan.