Family offices have multiplied in the last 20 years and with that has come the evolution of the sector into family offices that manage the money of more than just one family – the multi-family office. But is using multi in front of family office no longer fashionable?
Back before the financial crisis in 2008, the MFO was the ultimate private bank. Boutique and serving a few very wealthy clients, the concept appeared to have everything going for it, and, as a result, their numbers grew rapidly. In some ways MFOs were the new boutique Swiss private banks, but based in London and the US.
But, in the last few years, the term looks to be falling out of fashion. “There was a feeling that clients weren’t getting the bespoke services they were led to expect at a MFO,” says a former client of a London-based MFO. “And at the same time, the compliance costs were rising rapidly for many of these institutions, which put huge pressure on their businesses.” That has led to consolidation among MFOs – and it appears that at the same time a major rebranding exercise started.
What looks to be emerging in the place of the MFO brand is the term investment office. Two big London-based MFOs now call themselves investment offices – Sandaire and Stanhope Capital. Others like Capital Generation Partners branded themselves to begin with as a private investment office. In the US, firms specializing in managing the money of very wealthy families like Pitcairn, Guggenheim Partners, and Rockefeller & Co don’t use the term MFO.
Of course, there are still exceptions. London-based Stonehage, which recently merged with Fleming Family and Partners, which in many ways represented the pinnacle of an MFO in the 2000s, describes itself as a leading multi-family office. But it will be interesting to see how much longer this branding lasts given the trend.
Could the same rebranding happen for single-family offices?