Family offices have long held a distinctive role in the wealth management ecosystem, balancing the preservation of generational wealth with a willingness to pursue unorthodox investments. Today, their priorities are shifting under the combined influence of generational change, economic uncertainty, and technological transformation.
Nonetheless, Jamie Nascimento, co-founder and chief commercial officer at LemonEdge explains how family offices are adapting and what this means for the banks that serve them.
Jamie Nascimento, co-founder and chief commercial officer, LemonEdge.
One of the clearest areas of divergence within family offices lies in generational attitudes toward investment. While older generations may emphasise capital preservation and proven strategies, younger heirs are increasingly pushing for a broader remit.
“Younger generations within family offices have a greater focus on ESG than their older peers,” says Nascimento. “They’re typically more willing to put their money into investments that aren’t solely focused on returns but instead balance financial performance with an environmental or social benefit.”
This shift is pushing family offices into areas that might once have been considered marginal or experimental, such as impact funds, renewable energy, or community-focused projects. The challenge for banks is to match this evolving ethos, offering products and reporting capabilities that can capture both financial and non-financial outcomes.
In an environment marked by political instability and volatile interest rates, many investors have become cautious. Family offices are no exception, but their structure gives them an edge.
“The whole market at the moment is tentative,” Nascimento notes. “But one of the benefits a family office has over a traditional investment firm is that their capital is immediately available. They don’t have to go to market to raise, so where investment opportunities come up at really good valuations, there is an opportunity to move faster and ‘make hay while the sun shines.’”
This blend of caution and agility creates a dual personality: family offices can adopt a defensive stance to protect wealth but remain opportunistic when attractive assets become available. For banks, this dynamic means that speed and flexibility of execution are critical. Those that rely on legacy infrastructure may struggle to provide the responsiveness that family offices expect.
Diversification has always been part of the family office playbook, but the breadth of assets under consideration is often wider than in mainstream firms.
“Traditional management companies succeed because they have a clear thesis,” Nascimento explains. “A family office doesn’t need to do that. They can invest across a much broader range of assets based on the opportunity that arises and their interests. If they want to invest in a racehorse, they will. If they want to invest in gold, they will.”
This flexibility is both a strength and a logistical challenge. It places pressure on private banks to provide platforms capable of tracking and reporting on unconventional holdings. Nascimento points out that the expectation is for the same level of transparency across alternative or lifestyle investments as for equities or bonds, a tall order for institutions still tied to traditional portfolio systems.
Historically, many family offices managed their wealth using Excel spreadsheets and other ad-hoc tools. That is changing fast.
“Over the past few years, we’ve seen increasing shifts to using more modern technology for the back office,” says Nascimento. “As the family; the diversity of investments, and the expectation from the families/HNW individuals to take advantage of different tools like AI, all expand – family offices are increasingly eager to adopt new technology and use it to their advantage.”
The move away from spreadsheets towards specialised platforms reflects a broader professionalisation of the sector. For banks, it is also a wake-up call. As Nascimento stresses, “banks need to ensure their own technology infrastructure is capable of supporting family office-style requirements, ranging from complex multi-asset reporting to collaboration with external advisers.”
Those institutions that modernise will be better placed to capture a greater share of family office-related business, while those that lag may lose relevance.
Family offices are acutely conscious of privacy. Many prefer to keep their activities out of the public eye, not only to protect wealth but also for personal security.
“For various reasons, family offices prefer not to publicly disclose their wealth or what they are invested into,” Nascimento says. “They tend to use in-house teams for physical security, an approach that helps them keep sensitive information closely guarded.”
As offices transition to cloud-based and SaaS platforms, however, the cybersecurity challenge grows. Safeguarding data becomes as important as safeguarding physical assets. The expectation is that banks will match or even exceed the level of protection implemented internally. A lapse in cybersecurity could therefore prove catastrophic, both financially and reputationally.
Looking ahead, Nascimento sees structural shifts reshaping the family office landscape. The rise of entrepreneurial wealth creation and the growing number of ultra-high-net-worth individuals is bringing more families into the market.
“As the amount of family businesses expands, the number coming together to group their investments will become even more prevalent,” he predicts. “The technology requirement to manage multiple family office investments becomes even more important.”
The trend towards co-investment among families, along with increasing access to private markets for affluent retail investors, will place further emphasis on scalable, technology-driven solutions. This includes managing diverse asset classes but also handling the complexities of multi-generational and multi-family structures.
Despite the growing emphasis on efficiency and technology, the family office sector is unlikely to lose its bespoke character. Each family brings its own priorities, preferences, and idiosyncrasies.
“The industry today is consistently bespoke,” Nascimento observes. “The core requirements are the same, with every family business adding their own flavour. Most will benefit from using a purpose-built solution that can be configured to their own requirements. That way, they get the best of both worlds tried and tested technology that is suitable for their specific requirements.”
For banks, the message is clear: flexibility matters. Offering tailored services built on configurable platforms will allow them to serve a wide spectrum of family office clients without diluting efficiency.
The evolution of family offices presents both opportunities and challenges. Their combination of agility, diversification, and bespoke requirements makes them unlike any other investment entity. For banks, the prize is a deeper relationship with some of the world’s wealthiest families but only if they can meet rising expectations.
Nascimento concludes: “Family offices are becoming more professional and more sophisticated. Banks that invest in the right technology and infrastructure will be best positioned to serve them. Those that don’t will struggle to keep pace.”
In short, the family office of the future will be more collaborative, more technology-enabled, and more generationally diverse than ever before. And as their influence grows, the institutions that adapt alongside them will be the ones to thrive.
“LemonEdge: Family money, big moves” was originally created and published by Private Banker International, a GlobalData owned brand.
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