Even smaller family offices are doing direct deals

Lleyton Hewitt's family office has backed an Aussie startup...               Photo: James Barrett, Wikimedia
Lleyton Hewitt’s family office has backed an Aussie startup…               Photo: James Barrett, Wikimedia

The direct deal bonanza continues. And two of the latest deals proves that family offices of all sizes are going direct when looking for returns.

Lleyton Hewitt, the Australian tennis play, has backed a startup with his family office, say reports in the Aussie press. Linking up with the former head of News Corporation in Australia, Kim Williams, the Hewitt family office, has backed Vidcorp, an Aussie based corporate video analytics platform. Hewitt’s family office initially provided seed finance for the Melbourne startup, which is now seeking an additional A$3 million to expand into the US and Africa.

When it comes to funds available to invest, Hewitt’s family office isn’t up there with Michael Dell’s MSD Capital. Lleyton Hewitt was a highly successful tennis player, but his fortune doesn’t run into billions. But that’s not stopping his family office from doing direct deals, albeit at a venture capital level.

And here’s more proof that size doesn’t matter when doing direct deals. Boparan Private Office, the family office of Ranjit Singh Boparan, a British entrepreneur, has bought the UK-based Turkey producer Bernard Matthews. OK, the deal was a distressed one, as Bernard Matthews has been struggling for a number of years, but it’s a direct deal. Again, like Hewitt’s family office Boparan Private Office isn’t huge – Ranjit Singh and his family have a fortune of around £400 million, according to the Sunday Times Rich List. Singh’s very rich, but not a billionaire. And he clearly feels direct deals are the way forward.  

Family Capital reckons that size might have very little to do with whether family offices go down the private equity fund path, or opt for the potentially more expensive direct deal path. Many want more control over their investments and are going direct regardless of the cost.