Bill Woodson knows a few things about jobs in family offices. In the 2010s, he was head of the family office group at Credit Suisse and then Citi in the U.S. He's been a lecturer on wealth management at Columbia Business School and an advisor on family offices at Stanford. He's also co-written a definitive book about working for family offices, which he says is not always what people might imagine.
"The most important thing is to figure out what type of family office you're going into," says Woodson. There are different family office archetypes, he says: on one hand, family offices can be very institutional; on the other, they can be very traditional.
Institutional family offices are typically set up by hedge fund managers and are unsurprisingly akin to hedge funds. BlueCrest Capital Management, for example, is Michael Platt's family office after the 52-year-old hedge fund manager returned $7bn in clients’ money five years ago. It's thought to have around $10bn under management and employs an array of technologists, operations and data professionals alongside its portfolio managers, who are typically drawn from hedge funds and banks. Ray Dalio of hedge fund Bridgewater has opened a branch of the Dalio Family Office in Singapore alongside the office in Westport Connecticut. Soros Fund Management is also structured as a family office.
In these kinds of family offices, Woodson says the environment is very similar to a hedge fund. "They're typically run by former investment professionals, and they hire very competitively."
The more traditional family offices, however, aren't just about investing. If you work for one of these, Woodson says you can find yourself managing, "the complexity that comes from substantial wealth." While investing is one part of this equation, it can also involve everything from philanthropy to lifestyle and concierge services. In these kinds of funds, senior executives may find themselves working on tasks that are outside their backgrounds, says Woodson. "Even if you're not running concierge services yourself, you may need to find the right people to oversee the delivery and to address issues when they come up."
In some cases, therefore, Woodson says finance professionals who join family offices can find themselves responsible for areas far beyond their expertise. "You might be responsible for making sure that marketing, sales, finance, legal and compliance are all performed correctly, along with things like residence management, concierge services and private aviation."
Added to all these complexities is the issue of the family whose office you're working for - "the principal" in family office parlance. As family office headhunter Paul Westall of Agreus Group said a few years ago, life in a family office requires an ability to get along with the principal and is not a job for someone with a big ego. A lot is about "fit," says Woodson: "You will have potentially demanding clients – both principals and their families. And you will have a single client, which can be challenging. You may not have many resources because you’re simply not very large."
Succeeding in a family office therefore requires a combination of incredible intuition and abundant empathy. "Building a relationship with the principal is arguably the most important job you've got," says Woodson. "At the end of the day, it's their money."
Working with a principal is a completely different dynamic to working with other kinds of bosses. "The principal is typically a very successful person with a lot of confidence," says Woodson. "But they don't necessarily know what to do. Your job is to lead the principal by teach and acclimating them and helping them to understand the right approach. You can't operate through executive fiat."
Jobs in family offices can be very high pressure, says Woodson. And they're not just about making money or avoiding losses. "There will certainly be principals who care greatly about avoiding losses on the portfolio, but there will be others whose priorities are family harmony, simplicity, sponsoring sports, and philanthropy. It's crucial that you understand what the stated and unstated aims of the family are."
Photo by Valdemaras D. on Unsplash
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