How can firms that manage wealth be prepared to deal with turbulent times? [Farnoush Farsiar]

Generational changes Global mobility. Farnoush Farsiar Technology innovations. Farnoush Farsiar writes for EU Today that these are only a few key changes that affect family offices and pose a serious threat to their structures of operation.

Family offices are catering to the mobile, younger generation. Everyone, regardless of age, have become interested, regardless of their financial situation in managing their personal investments. This means they want more information and involvement , not just an investment manager to manage.

These changes, which occur at a time of unparalleled economic and political turmoil are a sign of the demise of the family office model that is based on fees. Offices that try to preserve their old methods are likely to be demolished by the clients they were founded to advise. They must change and be more innovative in their investment management approach, to provide a real value proposition to UHNWIs. While family offices may differ in terms of size and scope, they should prioritize agility over the desire to be experts in every area. Customers will appreciate a smaller team of advisors who are capable of quickly adapting to new technologies, and the hiring of external experts as needed. This has led to the blurring of lines between private banks and family offices. The most successful firms will continue to maintain the loyalty of family offices and the trust they enjoy while staying ahead of technology in sourcing deals and adopting new technologies.

Farnoush Farsiar It is crucial to be able to draw on traditional, network-based and reputation-based strategies for deal sourcing. Online tools can be utilized to spot deals and opportunities. Wealth managers can make use of deal sourcing sites online to identify opportunities and deals. They’re much more convenient than the large, cumbersome banks who are stuck in large-firm bureaucracy. Dealmakers can use these platforms to access and assess a variety of deals. This results in significant savings in time and resources.

Other services online that have changed the way family offices interact with their customers include dashboards, like Wealthica which instantly consolidates investments from a range of sources, bringing clients to daily interaction with their investments – an improvement from the days when wealth managers gave periodic information on the status of their customers’ money.

These tools are merely tools that allow wealth managers to increase their efficiency and speed. Their investment strategy is the most crucial aspect. Farnoush Farsiar It is essential to blend the old and the new. For instance you should continue searching for real estate opportunities, while also looking into investment opportunities in emerging areas such as food security or climate science. Impact investing has undoubtedly ‘arrived in the world of family offices – according to the UBS Global Family Office Report 2018 showed that one-third of family offices are active in impact investing, and most expect to become more active in the near future. There are a few issues with the field such as the difficulty of measuring impact and due diligence, the HNWIs and UHNWIs of the future will require family members to be able to locate the right investment opportunities. Plato Capital is my boutique investment bank. Plato Capital draws from the experience of its founders who have been employed in major banks, as well as in the tech industry. Plato Capital provides investment advice that is geared towards the entrepreneurial. Our personal local knowledge and network allows our clients to effectively manage risk and achieve optimal return on their capital.

Wealth managers can flourish during turbulent times through blending past and the future and adapting to the demands of the younger generation, and making a risk by establishing their own structure.