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1、August 24FROM LEGACY TO LEADERSHIPFAMILY OFFICEREPORTThe cover of the family office report presents a vivid portrayal of transformation,symbolised through the journey of a simple,humble cotton bud evolving into a powerful rupee note.In India,banknotes are predominantly crafted from cotton fibre due

2、to its durability and widespread availability,ensuring resilience under the demands of daily transactions.The tactile sensation of cotton instils a feeling of authenticity and confidence in monetary exchanges.This symbolism mirrors the elaborate transformation of family offices in India.Initially,fa

3、mily offices started as modest entities relying heavily on advisors or banks to allocate their funds.Over time,they have evolved into resilient and powerful industry leaders,adept at managing substantial wealth while aligning with the aspirations and values of the family businesses they serve.This t

4、ransformation highlights their journey from being a one-man army offering back-end support to becoming sophisticated,full-fledged business models integral to wealth management.The covers motif of cotton bud on the backdrop of the texture of a rupee note,aptly reflects the core theme of the report:Fr

5、om Legacy to Leadership,capturing the essence of how family offices have evolved and their promising future in Indias financial landscape.FOREWORDAs a prominent Indian business house,the TSF group(which promoted Sundaram Finance)represents four generations of family led management.The TSF family bus

6、iness,with over a century of heritage,traces its origins to 1911,when T.V.Sundaram Iyengar founded the business in Madurai,Tamil Nadu.The financial services business was started with entry into insurance through Madras Motor and General Insurance,and in 1954 Sundaram Finance was founded and remains

7、the flagship company of the group in financial services.In Sundaram Finance,now celebrating its 70th year in business,we have built a reputation of solid business results,but also for our commitment to values which are a cornerstone of our philosophy and a core part of our operations.Sundaram Financ

8、e began its journey with a vision to transform the hire-purchase finance sector in India.From its modest beginnings,the company has grown into a multifaceted financial services conglomerate.Today,Sundarams diverse portfolio includes Mutual Funds,Housing Finance,General Insurance,IT,Business Process

9、Outsourcing,and Asset Management,including Alternate Assets,with each segment reflecting our ethos.At Sundaram Alternate Assets,a proud subsidiary of Sundaram Asset Management,we take immense pride in our legacy which is deeply ingrained in our approach to investment management.We have over three de

10、cades of expertise in real estate and equity investments,and continue to innovate and deliver investor returns.We have a commitment to upholding the highest standards of transparency,data-backed research,and sophisticated operating models which underpin our approach to portfolio management.As a four

11、th generation business family,this report outlines issues that we and you struggle with constantly.We look at investment allocation,managing risk,preserving capital,dealing with different investment perspectives of different family members(often across generations),tax planning,wills,trusts and succ

12、ession,the costs/benefits of setting up a formal family office,managing giving/charity and its place in the familys wealth management.All issues that will be familiar to business families and family offices across the country and internationally.The family office ecosystem,in particular,has witnesse

13、d significant evolution,and we are keenly aware of the dynamic shifts and our legacy of prudent growth and dedication to service positions us uniquely to navigate these changes,offering insights and strategic support to our clients.This report,an embodiment of our continuous endeavour to share knowl

14、edge,reflects our dedication to understanding and responding to the evolving needs of the family office sector.As we move forward,we remain committed to embodying the Sundaram Wayensuring that our clients benefit from our deep-rooted values,extensive experience,and forward-thinking approach.In shari

15、ng this report,we aim to contribute to the broader discourse on family offices and support our clients with the insights needed to navigate this dynamic sector effectively.Harsha VijiExecutive Vice Chairman,Sundaram FinanceIn the ever-evolving landscape of wealth management,family offices stand as s

16、talwarts,navigating through shifting paradigms and emerging as leaders in modern wealth preservation and growth.In the corridors of financial power,these entities have been the quiet but impactful force,ensuring the endurance of family legacies across generations.Traditionally designed to cater to t

17、he multifaceted needs of Ultra High Networth(UHN)families,family offices have undergone a significant metamorphosis over the years.Fueled by the increasing quantum and concentration of wealth,coupled with the rising influence of the younger generation,these entities have embraced nuanced financial p

18、roducts and investment opportunities with remarkable agility.In India,where rich familial legacies abound,the structured management of wealth is still in its nascent stages.As families across India move beyond the hallways of traditional wealth,family offices are emerging as custodians of legacy,emb

19、racing global trends,and professionalising asset and wealth management practices.This report delves deep into the transformative journey of family offices in India,exploring their evolution,challenges,and future prospects.Through meticulous research and insightful analysis,it sheds light on the dyna

20、mic forces shaping the family office landscape,paving the way for a future marked by resilience,innovation,and enduring prosperity.As we embark on this journey of exploration and discovery,let us celebrate the resilience and vision of family offices,leading the way towards a new era of wealth manage

21、ment excellence.A note from theMDs DESKVikaas M SachdevaManaging Director,Sundaram Alternate Assets LimitedChapter 1:Adapting to new realities:Family offices leading the way in modern wealth management 03Chapter 2:Overview of global family offices 15Chapter 3:Where are Indian family offices investin

22、g?19Chapter 4:Operations and structuring of family offices 35Chapter 5:Succession planning 45Chapter 6:Key challenges and expectations 49Chapter 7:Future aspects 53TABLE OF CONTENTSThese personas provide readers with an insightful framework to understand the varying approaches and strategies employe

23、d by different family offices.DIVERSIFIER:Typically second-generation wealth,focused on de-risking and wealth creation through diverse investments.INNOVATOR:First-generation entrepreneurs leveraging their entrepreneurial mindset to invest in synergistic businesses and manage liquidity.CONSERVATOR:Mu

24、lti-generational families prioritising wealth preservation and growth with a reasonable risk appetite.PRESERVER:Families decoupling investment decisions from operating businesses to focus on preserving inherited wealth.EXECUTIVE SUMMARY The landscape of family offices in India is undergoing a signif

25、icant transformation driven by several pivotal trends.This report delves into these trends,providing a comprehensive analysis of the evolution,challenges,and future prospects of family offices in India.11.Road towards professionalisationBeyond the need to preserve multi-generational wealth,various f

26、actors are fueling the growth of family offices globally and in India.Influences such as next-generation impact,succession planning,and a focus on impact investing are compelling family-run businesses to professionalise their asset and wealth management.A key driver in India is the adoption of a gov

27、ernance and process-oriented approach to wealth management,with 70%of family offices indicating this need.2.Transition from wealth management to wealth creationFamily offices are evolving from their traditional role of managing wealth to becoming next-generation wealth creators.This transition is em

28、powering them to professionalise operations,adopt innovative strategies,and embrace new investment opportunities.By moving beyond mere preservation,they are now actively contributing to wealth creation,ensuring the growth and sustainability of family legacies.3.Diverse family office personasEach fam

29、ily office has a unique legacy and wealth management style.However,for the purposes of this report,we have categorised them into four distinct personas:4.Alternative Investment Funds(AIFs):The preferred choice for the next phase of growthAlternative Investment Funds(AIFs)offer a spectrum of products

30、 that can address the diverse needs of family offices.However,family offices in India are still relatively underexposed to these products compared to their global counterparts,who allocate more than 50%of their assets to alternatives.Increasing awareness and understanding of AIFs could significantly

31、 enhance the investment strategies of Indian family offices.Prominent family offices aim to increase their asset allocation to AIFs by up to 5%,with a particular focus on venture capital and venture debt,compared to a 1%increase in traditional investments.5.Vision of family offices determines their

32、team strengthFamily offices are structured primarily in two ways:On average,family offices in India have 4-6 team members,with the size varying based on the family offices structuring and vision.6.Talent acquisition and retentionAttracting and retaining talent remains a significant challenge for fam

33、ily offices.The need for specialised skills and the ability to maintain long-term relationships are critical for success.Developing robust talent acquisition and retention strategies will be essential for the sustained growth and operational efficiency of family offices.This type has a lean team,foc

34、using on selecting and allocating funds to external money managers without directly managing investments.They have a lean team as their research is related to asset classes and fund managers rather than individual companies.This type has a larger team because they handle internal investment manageme

35、nt in addition to potentially using external managers.They require different sector specialists,leading to a bigger team.2As the ecosystem continues to evolve,family offices will play an increasingly critical role in shaping the landscape of wealth management in India.This report covers insights fro

36、m 30+family offices across diverse personas.ManagerAllocatorTeam StructureCHAPTER 1Adapting to new realities:Family offices leading the way in modern wealth management 3Over the last few decades,family offices have been quietly standing tall against the three generation curse to ensure that family w

37、ealth can pole vault the squander stage of generational wealth and be preserved for posterity.Traditionally,family offices were tailored to cater to the multifaceted wealth management needs of Ultra High Networth(UHN)families that had requirements ranging from tax planning,financial management,and g

38、rowth to preservation and philanthropy.However,over time family offices have metamorphosed significantly prompted by higher quantum and concentration of wealth coupled with the rising influence of millennials and generation Z along with the emergence of nuanced financial products and investment oppo

39、rtunities.A quiet but impactful force Family enterprises traditionally thrive in stable or gradually changing environments that align with the prevailing cultural norms while remaining tethered to traditional tenets.This means that they are tasked with embracing new practices and strategies to ensur

40、e consistent success in the evolving business landscape while ensuring adherence to the foundational tenets of the family.A family office is an exclusive advisory firm specialising in managing the substantial wealth of affluent families.These privately owned entities focus on the growth and intergen

41、erational transfer of family assets for ultra-high-net-worth individuals(UHNWIs).In India,there are approximately 300+family offices1.These offices reflect a growing trend towards personalised,professional wealth management to safeguard and grow family wealth across generations.The report covers mid

42、 to large-sized family offices,and it is estimated that their AUM will grow at a CAGR of at least 14%over the next three years.Consequently,their assets could increase by 1.5 times during this period.Cumulatively the average AUM of all the family offices participating in the report is INR 70,000 Cr4

43、Exhibit:AUM of family offices covered in the reportQ:What is your current AUM?Source:Sundaram-Eleveight interactions with family offices1.Inc42 INR 1000 Cr 69%=INR 1000 Cr31%202021%25%29%17%8%71%of the families that we surveyed(the research includes family offices with varied legacies and background

44、s)have established their family offices post 2010,One of the key factors driving the growth of family offices in India is the need to adopt a governance and process-oriented approach to wealth management(70%)followed by a desire to maintain control over the decision making process(50%).Family office

45、s:Moving beyond the hallowed hallways of traditional wealthBeyond the obvious requirement to preserve multi-generation wealth,there are several other factors that are engendering the need for,and growth of,family offices,globally as well as in India.Global trends are driving family-run businesses to

46、 professionalise their asset and wealth management with influences such as next-generation impact,concerns around succession,and a focus on impact investing compelling this shift.Significant losses on investment portfolios managed by banks and large financial institutions have also prompted many wea

47、lthy families to seek greater control over their investments and reduce costs,leading to the rise of family offices.Currently,family offices in India are increasingly diversifying wealth across various asset classes,including real estate,fixed-income funds,hedge funds,equities,and private equity.The

48、se structures offer families improved methods for analysing and managing their investment portfolios to enhance performance.Accordingly,the search for better control and efficiency in investment management is now driving the establishment and growth of family offices.6Source:Sundaram-Eleveight indus

49、try interactionsExhibit:Key reasons for establishing a family officeQ:What were the key reasons for you to set up a family office?70%20%30%4050%Governance and process-oriented approach to wealth managementControl over decision making by employing own teamAccess to tailor-made solutions for specific

50、needsManagement of the financial needs of multiple family membersCost optimisation vs utilising external advisorsDecoupling the sources of wealthA deeper understanding of the family office ecosystem revealed the nuanced need to decouple the management of wealth from the core source of wealth creatio

51、n,i.e.,the operating business.Family offices are aware of the fact that the operating companies may not completely align with the vision of the family with respect to managing their wealth and thus prefer to establish a separate structure for managing family wealth.Further,this also results in devel

52、oping a separate entity whose sole purpose is to align with the goals of the family and work towards a unified vision.Establishing an alternate source of wealthAmong wealthy families,there is also an emerging realisation that the family office could become the next wealth creator for the family.This

53、 could be a very important reason to set up a family office,especially in scenarios where there has been a liquidity event,i.e.,when a family sells their business,either partially or completely,creating a large sum of money that needs to be managed effectively.The primary aim of such a family office

54、 would be to grow the capital which would require a strategy that strikes the right balance between growth and preservation with the former taking precedence.Further,newly created wealth from entrepreneurial ventures might lead to a family office focusing on reinvesting wealth into another venture,w

55、ith less emphasis on structuring existing assets.Take for example a leading NBFC.As the operating businesses grew and their credit rating enhanced,wealth that was invested in the NCDs from their operating entities generated relatively lower returns.While the goal of NBFC was to achieve a better cred

56、it rating,the enhanced credit profile reduced the interest rate earned on the NBFC.Hence,the need to make an effort to make their money work for them arose.Some of the more nuanced requirements are discussed below:7In Indias wealth landscape,the allure of glamour is notable.While some individuals re

57、sponsibly steward family wealth with subtleness,others opt for a more overt display,which could potentially result in unforeseen outcomes.Throughout history,discretion has been pivotal in wealth management,yet contemporary tendencies often favour flaunting wealth.At Multi-Act,our approach is marked

58、by a commitment to operating discreetly,prioritising expertise over public visibility.We uphold the belief that genuine wealth is most effectively safeguarded through discretion.Ashutosh BishnoiDirector,Multi-ActEntrust was formed in the year 2013,with a clear vision to build a practice that is fier

59、cely aligned with the clients interest.We cater exclusively to the investment and non-investment needs of those with exceptional wealth to help them flourish,not just in the present,but across generations.We came out with a concept called wise wealth,wherein our clients believe that wealth is not ju

60、st a transaction item-it has much more meaning to it.It has to transcend to multiple generations to build a stronger legacy.The ethos and core principles of the Entrust family office revolve around this concept of wise wealth.We believe in not just the ethical way of wealth creation but also believe

61、 in utilising the wealth to enrich families,communities,and society.Sreepriya N SDirector&Co-Founder,Entrust Family OfficeFamily offices,despite their diversity,can be depicted as four distinct types:8DIVERSIFIERINNOVATOR CONSERVATORPRESERVERGenesisDriver for setting up family officeManaging mix of

62、inherited and newly created wealth.Managing liquidity.Managing liquidity.Preserving inherited wealth.Wealth creationWealth creationWealth preservationWealth preservationContinuous flow of capital through dividends resulting in greater risk appetite for the new generation.Entrepreneurial mindset imbi

63、bing a higher risk appetite.Legacy business values continue to drive investment decisions and hence,priority is to grow wealth with reasonable risk.Legacy business values continue to drive investment decisions and hence,priority is to grow wealth with reasonable risk.Second generation of family weal

64、th Continuous capital flow through dividend income Objective for the second generation:De-risk family wealth from dependency on the operating company First-generation entrepreneurs generated wealth through M&A/stake sale,etc.Entrepreneurial mindset led them to formalise their wealth management into

65、a family office Objective:Invest in other businesses with synergy to their domain expertise Centralise the adoption of the entrepreneurs vision Multi-generational family business Primarily reinvests operating company surplus into the business Generated larger corpus of capital via minority stake sal

66、e Since the larger corpus requires dedicated management,family office was created Multi-generational family businesses invested in instruments from the parent entity(e.g.,NCDs)Realised that as the ratings of the operating company(OpCo)were enhanced,returns were hampered This realisation enabled deco

67、upling of investment decisions from the operating businesses and led to the establishment of a family officePrimary objective for the wealthRisk appetiteCase study:Sharrp Ventures(investment office of the Harsh Mariwala family)Category:Diversifier Keen on innovative opportunities in the consumer pro

68、ducts sector Sharrp VenturesKey Learnings Focusing on a concentrated portfolio,across the listed and unlisted space,is the best way to make money Undertaking direct alternative investments,when you have the experience,team and expertise in place,can help limit the expenditure on intermediary fees an

69、d commissions,thereby protecting the capital available Ensuring diversification across categories,industries and return perspectives can hold VCs in a good stead When investing in start-ups,you need to focus on building sustainably and set the right metrics to avoid capital burnout Investment Focus

70、Innovative ideas in consumer segments across verticals and use cases Public markets,VC and PE opportunities,and AIFs Challenges Identifying the most suitable MIS for the family office and finding the right service providers to create an MIS structured towards Indian families Filing of advance taxes

71、can be complex given that it is difficult to predict the potential dividend and cash flows Lack of information in the unlisted space Lack of awareness and education,on the part of family offices,about the risks and investment models prevalent in the unlisted marketTriumphant trailblazers-Inside the

72、extraordinary journeys of leading family offices 9Started in:2014Team size:6 membersFocus:Capital growthThe Why:Sharrp Ventures,the Mariwala familys family office,was established to allow the next generation to experience entrepreneurship indirectly through the ventures they invest in while also cre

73、ating other avenues of wealth,with the aim of de-risking from Marico,the family business.As a river of capital and not a pool,the family office has the ability and risk appetite to leverage the dividend income from Marico and focus on wealth creation rather than wealth preservation.Sharrp Ventures f

74、unctions as a venture capital fund and invests across public markets and unlisted private equity and venture capital opportunities.The reason why you can make huge gains in venture capital is because there is risk,but that means that theres potential losses also.So I think there is a lot of educatio

75、n that is required for the public and for these families who are coming into the fold of setting up a structure or a family office.There is a lot more awareness that needs to be created because it is trial by fire.Rishabh Mariwala,Managing Partner Sharrp VenturesCase study:SpaceWorld Family Office(i

76、ncorporated by Mr.Ankit Goel)Category:InnovatorA fund-like structure works best for the family offices SpaceWorld Family OfficeKey Learnings Keeping yourself updated with all the latest trends and products available for investment is imperative to optimal decision-making It is important for family o

77、ffices to perform like a fund,instead of an operating entity,to ensure optimum outcomes Investment partners must bring robust risk management and investment processes,deeper communications and insight sharing to the tableInvestment Focus Achieving stable,desired returns over chasing alpha Innovative

78、 use cases in technological infrastructure,chemicals,and micro-finance InvITs,direct real estate,direct equity&start-ups SpaceWorld prefers direct investment over AIFs since the investment universe is the same and the family office already has an investment team managing alternative investments Spac

79、eWorld also invests in its newer group companies and considers them a part of their investment portfolioChallenges Building the right solutions which will enhance overall value of the structure Challenging taxation norms prevalent across foreign and GIFT City investments have prompted the family off

80、ice to focus on domestic avenues10Started in:2022Team size:15 membersFocus:Growth of wealthThe Why:SpaceWorld Family Office was created subsequent to the sale of a promoter-held entity to Brookfield,with the intent of managing the payout and steering the promoters investments across various new enti

81、ties in the telecommunications and technology space.The promoters were keen on investing in new businesses,leading to the inception of the family office,which now manages central functions including strategy,investor relations,HR,internal audit and compliance.Most of the family offices we see are op

82、erating at the company level itself.At SpaceWorld,what we have done uniquely,and what I like,is we have moved away from the day-to-day operations of the group entities and act like a fund and leave the operating responsibilities to the management.The independent management team of each entity is res

83、ponsible for the performance of the companies and that is how family offices should operate.Usually,the promoters find it hard to move away from the day-to-day operations of the entities since they are extremely attached to the same but it is good if they can separate themselves and leave more respo

84、nsibility on the professional management part,they being a guiding force.Jasmeet Bhatia,AVP-Strategy,SpaceWorld GroupCase study:Vikas Poddar Family OfficeCategory:DiversifierOffshore investments in best-in-class companies a major focus area Vikaas Poddar Family OfficeKey Learnings Recognising the im

85、portance of internal expertise and a structured approach to investment management The importance of viewing the family office operations holistically,encompassing various aspects such as networking,taxation,compliance,reporting,and legal considerations.This comprehensive approach underscores the imp

86、ortance of integrating multiple disciplines into the investment decision-making process Focus on adopting a selective investment philosophy,particularly regarding asset classes and investment routes,with a preference for predictability and control in investment outcomes Recognising the benefits of o

87、ffshore investments as a means of diversifying risk and accessing innovative opportunities The importance of continuous evaluation and adaptation in investment strategiesInvestment Focus Direct equities and venture capital/private equity constitute a significant portion of the portfolio Offshore inv

88、estments targeting best-in-class global companies to diversify risk and access innovative opportunities Preference for sectors like technology,consumer goods,and wealth management,particularly in start-ups and fintechChallenges Balancing the need for capital growth with stakeholder values poses an i

89、nherent paradox in managing emotions and investment objectives Limited human capital in Indias talent pool presents challenges in hiring individuals aligned with the family offices agenda and values Inadequate technological infrastructure and tools for monitoring investments hinder efficient decisio

90、n-making and portfolio management11Started in:2013Team size:14 membersFocus:The Why:The Poddar Family Office was established to leverage the founders expertise in finance and investment,transitioning from business operations to professional wealth management.The decision stemmed from a desire to cre

91、ate wealth through strategic investment activities and a commitment to implementing proper practices in wealth management.Given that the fund is family capital,the founding family was keen on inculcating family values in their investing decisions.A combination of wealth growth&preservation a conserv

92、ative risk standpoint with an aggressive view on growthWe have numerous dynamic elements in the family office and look at it very holistically.For me,it is about getting basic processes streamlined building networks across financial centres to attain different opportunities,taxation,compliance,repor

93、ting in the right way,getting the right data from managers and managing the legal and auditing aspects.Yash Poddar,Co-Principal and CIO Vikaas Poddar Family OfficeCase study:GreenGen CapitalCategory:ConservatorAn external advisor can augment the family office tremendously GreenGen CapitalKey Learnin

94、gs Understanding that being a successful businessman does not necessarily translate to being an effective investor or allocator of wealth Realising the importance of aligning risk appetite with investment decisions Importance of acknowledging that emotional attachment to personal wealth can cloud ju

95、dgement,highlighting the benefit of having an external party and a structured approach towards managing the portfolio Embracing an evolving investment landscape by continuously learning about new asset classes and investment opportunities is imperative to success Having the willingness to allocate a

96、 small portion of funds to unfamiliar asset classes as a tuition fee to gain understanding is necessary Younger generations are keener on aggressive approaches to investing When investing in start-ups,it is advisable to go full-fledged and invest in 15-20 of them,in addition to being well-involved i

97、n their progress Our experience indicates that wealth managers are biased towards the products they are offering Having a performance linked upside structure is imperative for the investing team to align long term goals.This includes having clawbacks on performance pools as well as for non-performan

98、ce CIO co-investment in transactions brings in better sense to risk-reward alignment,transparency in governance structure.You should be comfortable investing your personal money in the same strategy used for family office investments,by this you align yourself to a common goalChallenges Continuously

99、 grappling with the challenge of attracting and retaining talent in a competitive market and competing with larger brokerage houses and funds for skilled professionals while offering competitive compensation packages Striking a delicate balance between preserving wealth and generating alpha balancin

100、g the need for stable,conservative investments with the desire for higher returns through riskier assets Facing challenges in understanding and navigating new asset classes,such as gaming,crypto,and art,which may require specialised knowledge and expertise Dealing with regulatory and compliance comp

101、lexities,especially in the context of alternative investments and cross-border transactions Staying updated with evolving regulations and ensuring adherence to legal requirements in all investment activities12Started in:2019Team size:6 membersFocus:Growth of capitalThe Why:In 2019,Greengen Polymers

102、witnessed a monetisation of the main business,resulting in a sudden inflow of a large amount of money in a very short period of time.Following the monetisation,the promoters were tied up in a non-compete clause and felt a void,due to the large amount of liquidity available.To fill the void and lever

103、age the liquidity,the promoters started building a family office with a proper team,policy structure,investments,and investment models in place.13Investment Focus Allocation heavily towards equities,with significant returns expected Diversification into debt,REITs,private equity funds,commodities,an

104、d real estate Start-ups and SME IPOsAn external party can make much better decisions here,you should think about the management of a portfolio versus you managing your own money,because you are emotional when it comes to your own money.So,a lot of decisions you make might not be in the best interest

105、 of your portfolio.While you might feel that you are doing the right thing,somebody external,who aligns with your risk appetite,can do it better.Nilang Jain CIO,GreenGen CapitalCase study:Sukvi VenturesCategory:ConservatorFinding the right talent a major challenge for family offices Sukvi VenturesKe

106、y Learnings The imperative nature of focusing on risk management and risk-adjusted returns to protect and preserve family wealthInvestment Focus Majority allocation to PE and VC Diversification across public market sectors Co-investment with AIFs in startupsChallenges Difficulty in finding talent wi

107、th a robust understanding of the multifaceted responsibilities of a family office Limited profit-sharing opportunities in family offices affecting talent retention Lack of transparency in reporting and higher fees when working with advisors,leading to capital drain14Started in:2022Team size:4 member

108、sFocus:Mix of capital preservation and growthThe Why:The promoter sold their stake in an entity to a U.S.based company and came in possession of a copious amount of wealth.Initially,this wealth was being managed based on the advice from wealth managers but later,the promoter decided to set up a fami

109、ly office and manage the wealth through the same,thus leading to the inception of Sukvi Ventures.A major challenge in the family office arena is looking for talent because it is a nascent business.Very few people understand the entire concept given that a family office is very different from buy-sid

110、e entities like mutual funds or portfolio management services we are not restricted to investments but also have to consider every aspect,from taxation and filing of returns to legal notices and succession planning.Sachin JainCIO/Head of Investment Sukvi VenturesCHAPTER 2Overview of global family of

111、fices 157 Credit Suisse8 KPMG-The 2023 Global Family Office Compensation Benchmark Report.(625 Respondents)The growth of global wealth has significantly increased the number of family offices.Currently,there are approximately 10,5007 family offices worldwide and these entities are becoming influenti

112、al players in the investment landscape,as HNIs and families prefer to manage their investments internally.Family offices are particularly attractive due to their long-term perspective and patient capital and these entities are now competing with major financial institutions for top talent,reflecting

113、 their growing prominence and influence in the financial sector.Among global family offices,26%manage an AUM of USD 251 Mn to 500 Mn with only 6%managing an AUM of over USD 5 Bn8.Most of the large family offices are seen to originate from the USA,with 12%operating an AUM of over USD 5 Bn.Exhibit:AUM

114、 view of global family offices816UK18%AUMAUMAUMAUM4%20%21%16%USD 500 Mn-USD 1 BnUSD 251 Mn-USD 500 MnBelow USDUSD 5 Bn+USD 2.1 Bn-USD 5 BnUSD 1.1 Bn-USD 2 BnUSD 500 Mn-USD 1 BnUSD 251 Mn-USD 500 MnBelow USDUSD 5 Bn+USD 2.1 Bn-USD 5 BnUSD 1.1 Bn-USD 2 BnUSD 500 Mn-USD 1 BnUSD 251 Mn-USD 500 MnBelow U

115、SDUSD 5 Bn+USD 2.1 Bn-USD 5 BnUSD 1.1 Bn-USD 2 BnUSD 500 Mn-USD 1 BnUSD 251 Mn-USD 500 MnBelow USDUSD 5 Bn+USD 2.1 Bn-USD 5 BnUSD 1.1 Bn-USD 2 BnUSA13%12%23%13%17%22%ASIA24%4%20%12%20%20%EUROPE20%5%23%14%26%12%21%17AUSTRALIAUAE8%5%45%32%5%5%AUMUSD 500 Mn-USD 1 BnUSD 251 Mn-USD 500 MnBelow USDUSD 5 B

116、n+USD 2.1 Bn-USD 5 BnUSD 1.1 Bn-USD 2 Bn32%3%41%0%21%3%AUMUSD 500 Mn-USD 1 BnUSD 251 Mn-USD 500 MnBelow USDUSD 5 Bn+USD 2.1 Bn-USD 5 BnUSD 1.1 Bn-USD 2 BnIn the initial days,we tried to establish RAAY as a multi-family office with the intent to apply our observations from the West.After 2 years of g

117、oing across to our peer group families,we observed a basic apprehension among the wealthy families,i.e.,an apprehension to share ones wealth details with another family owners setup.However,due to the shapeshifting nature of this industry and the dominant need of wealthy families to adopt a more str

118、uctured approach to managing familial wealth,we believe that the multi-family office setup in India was set to grow.Accordingly,we decided to approach it with a strategic investment in a 3rd party setup instead.Benaifer MalandkarCIO,Raay Investments9 Real assets-KKR defines this as,real estate equit

119、y and credit,personal real estate,commodities,infrastructure,and other real assets such as timber/artwork.Exhibit:Broad asset allocation of global family officesExhibit:Broad asset allocation of family offices in the alternatives segmentSource:KKR 2023 Family Capital Survey Source:KKR 2023 Family Ca

120、pital SurveyIn terms of the AUM mix,family offices are allocating more to alternatives with 52%of the assets allocated to alternatives,as of December 2023.Among the alternatives segment,meaningful diversification is visible,including a significant jump in allocations to real assets9,private credit,i

121、nfrastructure,and private equity.1860%50%40%30%20%10%0%100%75%50%25%0%10%52%20179%29%9%50%202010%31%9%52%202310%29%CashAlternativesFixed Income Listed equities 20172020202311%15%46%6%8%22%54%4%22%12%8%21%50%7%11%3%OtherHedge FundsPrivate Equity/VCReal EstateOther Real AssetsPrivate CreditBroad Asset

122、 Allocation as a%of Total Allocation to Alternatives2017-202319CHAPTER 3Where are Indian family offices investing?As the saying goes,If you have met one family office,you have known only one family officeEach family office has its distinct story of genesis,method of doing business,and process of man

123、aging wealth.Inarguably,the portfolio composition would also be differentiated.However,there are a few commonalities based on overall objectives and risk assessment.Most importantly,each family office investment strategy is based on complete alignment of the familys business,long term aspirations,an

124、d strategic goals to the investment frameworks followed for selection of a product or startup.Two key aspects that family offices consider while selecting the suitable products for their portfolio are:Many family offices have invested in overseas markets as well.This is done from a diversification p

125、erspective.Most of them opt for the LRS or ODI routes for their investments.However,a significant number of family offices believe that these routes are not sustainable on a long term basis for their investments.20Ability to have access to the capital at a reasonable period of time.A lot of family o

126、ffices consider AIFs less liquid due to the long lock-in periods as seen in PE funds.Transparency in terms of the expected returns as understood while on-boarding the product manufacturer.LiquidityTrack RecordWhenever we invest,simplicity is key for us.We prefer straightforward presentations from fu

127、nd managers,avoiding unnecessary complexity.Our focus is on tax-efficient products,and thats our primary consideration.Ultimately,we aim to align our investments with the market.Tejpal JainCIO,Suashish Diamonds Family Office20%of the respondents said that greater than 50%of their portfolio is alloca

128、ted towards mutual funds making this the preferred investment vehicle followed by a proclivity towards fixed income and direct equity.21Exhibit:Current portfolio allocation of family offices towards each of the following asset classQ:What is your current portfolio allocation towards each of the foll

129、owing asset classes?Source:Sundaram-Eleveight industry interactions 1-10%11-20%21-30%41-50%50%Mutual FundsPMSAIFFixed IncomeStartupsDirect EquityReal Estate(physical)40%13%13%7%20%40%27%59%18%12%6%24%12%24%18%12%42%25%17%8%53%13%13%38%31%6%12%We adopt a collaborative approach in our investment endea

130、vours,engaging not only with fund managers but also with other family offices.Recognizing the diverse expertise within each family office stemming from their business backgrounds,we actively seek industry insights when evaluating opportunities.Devashish KhannaLead-Private Investments,Capri Global Fa

131、mily OfficeInvestment styles and preferences of family offices are based on the following aspects:Core objective of family office(Growth/Preservation/Hybrid)The choice of product category is linked to the risk appetite of the family office.The bifurcation between the underlying equity and debt contr

132、ibution and the choice of non-traditional products like AIFs is influenced by the growth/preservation objectives of the family office.The objectives of the family office may also evolve over time with the maturity of the investment team and the generational shift in the leadership.For example,the pr

133、imary focus of the Suashish Diamonds family office was to deploy surplus funds and generate a reasonable return.However,the objective has gradually shifted towards growth and investing in a wider variety of asset classes.The first generations primary focus was business,then the second generations fo

134、cus was on both business and investments and now the third generations primary focus is investments but with patient capital.The product focus also has shifted gradually from being fixed income heavy to diversified across products such as equities,startups and AIFs.Majority of the family offices und

135、erstand mutual funds as a category very well and hence,the choice of vehicle is inclined towards a combination of products within mutual funds.22Background of the familys business or members in financial services Individual family members who are directly involved in the decision making have a signi

136、ficant influence on the choice of products.Families like Shivanssh Holdings LLP(Vikas Poddar family office)or Sharrp Ventures that are led by individuals who are primarily and personally responsible for the family office decisions,have an inclination towards direct deals(private markets).However,mos

137、t family offices are now exploring opportunities across both public as well as private markets.For example,the family office of Suashish Diamonds prefers to maintain a well diversified portfolio that is spread across various investment opportunities and vehicles such as mutual funds,PMS,and private

138、investments in startups.Sharrp Ventures,the firm that manages the proprietary capital of the Harsh Mariwala family founding family of Marico Ltd.primarily-is focused on private market investing in-house and has a separate entity taking care of public market investing.Evolution of the investment comm

139、ittee in the family office The evolution of the investment committee of the family offices is also a gradual process.Majority of the large family offices started their investment journey by seeking support from wealth managers or multi-family offices and gradually decided to centralise investment de

140、cisions in-house and get execution support from their bankers or wealth managers.For example,Sukvi Ventures,GreenGen Capital realised after a few years of working with wealth managers that they are well equipped to handle the selection of products/opportunities on their own.This also resulted in an

141、increase of direct deals and co-investment opportunities with funds directly.23Networking capability of the family office decision makers The biggest source of information and knowledge for family members is their strong and close knit networks.As the family office ecosystem in India is evolving,the

142、 families are becoming more comfortable accessing their networks for collaborative deals and even access to ideas across direct deals as well as funds.Family offices are also considering collaborating with other family offices for shared knowledge and due diligence.Some family offices view collabora

143、ting with others as a team effort rather than a competition to identify the most suitable opportunities.Parent company or founder background A significant number of family offices are inclined to invest in products that are aligned to the parent company business verticals or are a strategic fit to t

144、he business model.For example,at Muthoot family office,the selection of private market investing opportunities is primarily based on the business being a strategic fit to the parent company.Similarly,SpaceWorld family office considers its investee companies as an extension of the vision of the paren

145、t entity to spearhead innovation in telecommunications sector especially leveraging techno logy solutions.Concentrated approach to align with sectoral priorities Family offices choose PMS and AIFs as an opportunity to get concentrated exposure to specific themes that the investment team is bullish o

146、n.Especially AIFs allow family offices to take a concentrated approach towards public markets as well as private markets through the choice of multiple strategies.As a family office,we leverage collective intelligence to strategically invest across various asset classes,sectors and stages.We employ

147、a blend of in-house&external resources like wealth managers and the investment ecosystem at large.Periodically,we establish consortia with select family offices with diversified areas of expertise,which is a great value-addition to our portfolio companies.Apurva ShahCOO,Taparia Family Office-B2V Ven

148、turesFrom a sectoral perspective,technology and financial services continue to be the most favoured sectors for family offices.For example,a leading family office invests in only those sectors in which they are comfortable.They dont understand agriculture,non-veg,and beverages and hence,they dont in

149、vest in these sectors.In certain cases,family offices seek insights from their network of family offices with expertise in the specific sector that they need more information on before validating a deal.A lot of family offices,after investing across sectors,realised that they needed to define broad

150、guidelines in terms of risk return and sectoral preferences for their public market investments.Further,they felt that the portfolio held too many stocks across diversified sectors and thus,chose to adopt a concentrated approach that focused only on select sectors-in an attempt to generate alpha.Thi

151、s evolution is what has enabled family offices to establish stronger investment frameworks over the years.Technology and financial services are top sectors for family offices when it comes to investing in public markets.Exhibit:Sectoral preferences of family officesQ:What is your sectoral preference

152、?24Source:Sundaram-Eleveight industry interactionsTechnology40%30%20%10%0%FinancialServiceHealthcareManufacturingReal EstateSector Agnostic38%31%13%6%6%6%Family offices often gravitate towards sectors that are aligned with their core business sector first,i.e.,the sector in which they are doing busi

153、ness,because they understand that business very well.Indian family offices are going to significantly increase AIF allocations in the next 3 years.Exhibit:Changes in portfolio allocation for family offices over the next 3 yearsQ:What could be your portfolio allocation towards the following asset cla

154、sses in the next 3 years?Source:Sundaram-Eleveight industry interactionsExhibit:Average change in family office asset allocations in the next 3 yearsSource:Sundaram-Eleveight industry interactions25 1-10%11-20%21-30%30%Mutual FundsPMSAIFFixed IncomeStartupsDirect EquityReal Estate(physical)20%30%20%

155、20%22%44%11%42%25%25%8%27%18%36%9%40%20%30%73%9%9%33%25%25%25%Mutual FundsFixed IncomePMSAIFIncrease by 1%Increase by 1%Direct EquityIncrease by 1%StartupsGoldIncrease by 1%Decrease by 8%Real Estate(physical)Decrease by 3%Maintain the sameIncrease by 5%Alternative investments:Growing sphere of influ

156、enceIn the portfolio,within alternative investments,family offices have primarily focused their investments on private equity,venture capital,and long-only funds.While the exposure of Indian family offices to alternative investments is relatively lower compared to global family offices,the vehicles

157、sphere of influence is certainly growing.Q:What is your current portfolio allocation towards the following asset classes within alternatives?Source:Sundaram-Eleveight industry interactionsExhibit:Current portfolio allocation of family offices within alternatives26Private EquityVenture CapitalPrivate

158、 DebtHedge FundsVenture DebtReal Estate FundsInfrastructure FundsLong OnlyLong Short 1-10%11-20%21-30%30%43%7%14%21%31%15%23%15%56%11%38%13%13%25%13%14%29%14%29%13%13%25%17%AIFs as an inclusion in the portfolio are certainly becoming more popular.One big reason is that a family office,like any other

159、 long term investor,would have a primary objective of meeting cash-flow needs across a large number of years,possibly even across generations.To be able to meet those cash-flow needs,they need to have a certain rate of return and a certain liquidity in their portfolio.For these requirements,most of

160、the traditional asset classes fail because they are either not able to offer that liquidity or theyre not able to provide that return.That is why alternatives are actually becoming more popular,because they can be modified or they can enable investments that ensure the financial engineering of both

161、liquidity and returns.Nitai UtkarshLead-Investment Strategy,Pawan Munjal Family OfficeFamily offices consider AIFs a preferred investment vehicle due to the following reasons:Monitoring capability and bandwidthSome family offices believe that as a minority shareholder it is difficult to track and mo

162、nitor individual startups for family offices due to limited resources.Expertise of product curationAIFs have experts that have the capability to select opportunities across the risk return spectrum in public and private markets.Family offices want access to fund managers who have a proven expertise

163、and track record in their domains.Co-investment opportunityFamily offices that have a strong investment team have specific ideas that they wish to execute.Setting up a fund may require more operational hassles and hence co-investing with an existing fund is one of the best methods to execute a strat

164、egy that the investment team has high conviction on.Concentration risk Investing in a single startup carries high risk compared to a diversified portfolio of startups selected by the AIF.Access to niche ideasFamily office investment teams specialise in allocating a portion of the portfolio to third-

165、party products,including AIFs.They provide access to niche opportunities that align with the familys business interests,particularly private market investments.27Decrease by 1%Increase by 2%Exhibit:Changes in alternative portfolio allocation over the next 3 yearsExhibit:Average change in allocations

166、 within AIF portfolio in the next 3 yearsIndian family offices are going to significantly increase their allocations in venture capital,venture debt and long-short over the next 3 years.Q:What could be your portfolio allocations towards each asset class within alternatives in the next 3 years?Source

167、:Sundaram-Eleveight industry interactionsSource:Sundaram-Eleveight industry interactions28Maintain the sameIncrease by 2%Increase by 1%Increase by 2%Increase by 1%Venture DebtLong ShortVenture CapitalPrivate DebtInfra-structure FundsReal Estate FundsPrivate EquityVenture CapitalPrivate DebtHedge Fun

168、dsVenture DebtReal Estate FundsInfrastructure FundsLong OnlyLong Short 1-10%11-20%21-30%30%27%36%18%30%20%10%20%29%29%40%17%17%29%14%14%14%14%14%13%13%13%13%20%Private EquityLong OnlyDecrease by 2%An important aspect to consider,especially in the case of alternative investing,is how the family offic

169、e is educating itself about alternatives and accessing the right investment opportunities.Exhibit:Preferred medium or platform to source information on alternativesQ:What is your preferred medium or platform to source information on alternatives?Source:Sundaram-Eleveight industry interactions29The n

170、etwork of family offices is very important.Family offices usually have their own network of like-minded family offices,through which they get a lot of direct deals too.This is beneficial to them not only to gather information on alternative investment opportunities but also to get direct deals to in

171、vest directly into the company.Everyone in the network has their own capabilities in sourcing and understanding of certain sectors and deals.There are a lot of forums too.The networking ecosystem for family offices has become formalised and now even the mid-sized corporates are forming their own fam

172、ily offices.As time moves on there will be more structures coming into the ecosystem.54%54%15%15%15%15%8%8%8%8%NetworkNewspaperSocial mediaCompany paperFund Manager12Hence,family offices expect more personalised service from the fund managers.Trust plays a major role in the decision making while cho

173、osing a fund manager.Alignment of values,prior experience,and the reputation of the fund manager drive the decision making.Access to informationRobustness and clarity of investment processFamily offices need succinct as well as detailed information from funds.Especially the inconsistency in reportin

174、g and varied formats of reporting make it challenging for family offices to evaluate funds.A fund manager that adopts transparency and consistency in reporting stands a better chance of getting onboarded.Family offices that have limited investment team members rely on the fund managers conviction on

175、 the idea.They require and expect the fund house to showcase the robustness and depth of the investment process.They also emphasise the importance of explaining the investment products in a simple manner that is easily understandable rather than making it more complex to understand.Trust also stems

176、from two major factors:Despite direct exposure,a majority of the portfolios of a large number of family offices still continue to be via AIFs.Exhibit:Important factors influencing the decision to choose an investment managerQ:How would you rate the following factors in terms of importance while choo

177、sing the investment manager?RankSource:Sundaram-Eleveight industry interactions30Accessibility to the managers or responsiveness to answer queriesTransparency of reportingRobustness of investment processAbsolute performanceCapability of alpha creationTimely distribution of capital and returnsRisk ma

178、nagement1234567Cumulatively,the family office who participated in the survey on average have invested close to INR 300 Cr in startups.3190%of the respondents affirmed that their family office invests in startups while 71%said that they invest directly and 29%said that they invest via AIF.The alterna

179、tive to AIFs:Direct investing in startupsA lot of family offices have initially leveraged the AIF route for accessing private markets.The key objective was to understand the due diligence required to access an entrepreneurial venture and the entrepreneurs.For the first 3-5 years they invested primar

180、ily in VC focused AIFs to educate themselves about the space by becoming a part of the ecosystem and understanding key technical aspects.After gathering the necessary information over a period of time,they are now focusing more on direct investments post onboarding a suitable team with the relevant

181、backgrounds.Exhibit:No.of startups in family office portfoliosExhibit:No.of startup investments made in 2023Q:How many startups have you invested in as a family office?Source:Sundaram-Eleveight industry interactionsQ:How many startups have you invested in,in 2023?Source:Sundaram-Eleveight industry i

182、nteractions50%6-101-51025%25%67%4-61-322%611%Evaluating past performance and the track record of fund managers is paramount,but equally crucial is the gut instinct and comfort level we feel with them.There have been instances where stellar performance could not outweigh personal misgivings about a f

183、und managers demeanour.Nirbhay KanoriaPresident&Director,Anglo French Drugs and IndustriesWhen evaluating an investment opportunity in an investment fund,we look for their track record,a smaller fund size,a good team,transparency,better communication,and better returns.The engagement the manager bui

184、lds with our team is important for us.Jay DesaiPartner,MGA VenturesFamily Offices interacted with,exhibit a strong preference for Consumer Goods and FinTech when investing in startups.These sectors are leading the way,with family offices placing significant focus on them.Following closely behind are

185、 financial services,enterprise applications,and retail,which also attract substantial interest from family office investors.Exhibit:Sectoral preference of family offices for startup investmentsQ:Which sectors do you prefer to invest in while investing in startups?Source:Sundaram-Eleveight industry i

186、nteractions3285%50%Consumer GoodsFinTech35%25%Financial ServicesEnterprise Applications25%Retail20%HealthTech15%15%Business ServicesAuto15%HealthcareExhibit:Average corpus invested in startups directlyQ:On an average how much corpus have you invested in startups directly?Source:Sundaram-Eleveight in

187、dustry interactions46%10-50 Cr100 Cr50-100 Cr15%Few family offices have segregated startups in terms of high/medium/low engagements.The high,could engage with the founders once a week.Since predictability is tough in the early stage investments,the objective that the entrepreneurs have set up for th

188、e board,or the plan of action the founders give the family offices is evaluated against the actual performance.Although more family offices are investing in startups directly,the possibility of generating substantial returns arises only if the investment is across multiple ventures,at least 15-20 st

189、artups.Only after achieving 3-4 good exits,will the family office be able to achieve the targeted returns.So when it comes to investing in startups,family offices should either follow a full-fledged approach and invest in 15-20 of them or invest via existing funds.Key drivers for family offices to i

190、nvest in startups:33Entrepreneurial mindset:Family offices invest in startups based on their risk tolerance and backgrounds.Entrepreneurs may be more open to risk than inheritors.Hence,first generation entrepreneurs and second generation family members find it more attune to their risk appetite to i

191、nvest in startups and continue their entrepreneurship journey indirectly.Co-investment opportunities:Family offices can get co-investment ideas from the venture capital funds they invest in,This means they can learn about specific startups that the venture capital fund is considering and potentially

192、 choose to co-invest alongside them in those startups.Access to unique ideas to allocate a small portion of their assets:Family offices look for something“unique”when it comes to startup investments.They only invest in something that has some proof of concept,potential to scale and become profitable

193、.One of the family offices only invests in SME companies as they feel that in terms of valuation they are 10-20 times higher.They are very profitable and they offer some amount of liquidity also on exchanges.Strategic synergies with parent business:Some family offices expressed their preference for

194、startups in a specific sector due to their background and potential synergies.They leverage the startup ecosystem as an extension of their core business.Collaboration with their network:Startups are also considered an opportunity to co-invest alongside each other by family offices.Especially if the

195、family members are directly responsible for decision making,they tend to collaborate with their fellows in other family offices to invest together in startups and leverage their synergies.A major challenge while investing in startups for family offices is the time,effort,and technicality required to

196、 perform activities such as financial and legal diligence along with the traditional due diligence for assessing a companys growth potential.Family offices do leverage personal and professional networks to gain valuable insights from industry leaders-this provides a deeper understanding of a company

197、s prospects and potential challenges.An increasing number of family offices are now collaborating with other family offices to share transactions and discuss opportunities for investment decisions.This helps family offices leverage diverse perspectives and potentially leads to better outcomes.34The

198、evolution of wealth management reflects a shift towards organised forms of investment,diverging from traditional avenues like land ownership.Today,the landscape is marked by a surge in financial securities and innovative wealth creation avenues such as ESOPs and start-up investments.This rapid trans

199、formation underscores the need for specialised outfits to navigate and manage this newfound wealth efficiently.Eapen Alexander MuthootExecutive Director,The Muthoot Group35CHAPTER 4Operations and structuring of family officesThere is a growing trend toward expanding team size,with many family office

200、s planning to increase their staff by 50%over the next three years to better manage the complexities of wealth planning and investment management.Especially,family offices that have generalists in the research and investment teams are aiming at expanding their team to hire specialists for asset clas

201、ses.The size of the investment team usually varies based on the structuring of the family office.Team structureAs more and more families intend to set up a formal structure for their investments,they seek more guidance from the ecosystem.To understand the family office landscape and structures,some

202、family offices have studied the evolution of family offices abroad by attending various conferences overseas.Before setting up a formal structure the family members interact and meet people who have already set up a family office to understand the different structures of family offices and adopt the

203、 correct structure for setting up their own family office.Exhibit:Team size of family officesQ:What is your current team size?Source:Sundaram-Eleveight industry interactionsFamily offices are structured primarily in the following ways:This type has a lean team,focusing on selecting and allocating fu

204、nds to external money managers.They do not directly manage investments themselves.They have a lean team since they do not need to do in depth research on each individual company,their research is related to asset classes,fund manager and his/her capabilities.This type has a larger team because they

205、handle internal investment management in addition to potentially using external managers.They also require a bigger team as they need different sector and asset class specialists.ManagerAllocatorTeam Structure61%17%13%4-61-314-1836This suggests a reliance on traditional methods and ready-made techno

206、logy solutions,raising questions about whether more investment in technology could improve efficiency and innovation.Multi family offices typically manage the assets of multiple high-net-worth families.The presence of a large team in multi-family offices indicates the need for a broad range of exper

207、tise to cater to a diverse client base,as well as the increasing demand for customised financial services.Majority of family offices(60%)have at least 2 members from their team dedicated to research and market intelligence.The survey revealed that staffing is the largest expense for family offices,t

208、aking up a significant portion of operating costs.This underscores the importance of a skilled team for managing financial portfolios and serving high-net-worth families.Family offices invest heavily in staff salaries,benefits,and training.In contrast,technology is the least costly activity for fami

209、ly offices,with about 80%of respondents allocating less than 10%of their budget to it.Exhibit:Operating cost for family officesQ:What percentage of your operating cost is spent on the following activities?37Source:Sundaram-Eleveight industry interactions 0%1-10%11-20%21-30%30%TechnologyStaffResearch

210、Legal/complianceAdministrative expenses 7%71%7%7%7%7%7%14%14%57%18%36%36%9%8%50%25%17%22%44%11%22%As our clients grow in stature,direct interactions with them are increasingly common,demanding a delicate balance of availability and prioritisation.Fortunately,digitisation has strengthened our data an

211、d relationship management,aided by a robust research and product teams which keep us informed and agile.Manjit SinghPartner,Alpha CapitalHowever,more than 20%of respondents outsource services such as tax planning,lifestyle management,family trust,and succession planning.For example,in the VC space,m

212、ultiple research firms are leveraged to conduct focus group discussions,on ground research,meeting with retailers and distributors before the financial evaluation of the startups.For example,a leading family office conducted a syndicated research about the demand for male sexual health products befo

213、re investing in the startup offering the products.The survey indicated that the majority of family offices carry out these services in-house.According to the data,over 70%of respondents handle key functions like investment management,philanthropy,and investment research internally.Although research

214、is primarily done in-house,family offices that are investing directly in startups or other ventures do seek support from specialised research firms.38Exhibit:Services that are performed in-house and the one that are outsourcedQ:Which of the following services do you insource/outsource?Source:Sundara

215、m-Eleveight industry interactionsIn-houseBoth in-houseand outsourcedOutsourcedDo not perform 44%31%19%6%69%13%19%71%24%6%38%15%23%23%43%36%21%38%31%31%71%7%14%7%75%19%6%54%23%23%Regulatory ReportingAccountingInvestment ManagementLifestyle ManagementSuccession PlanTax PlanningPhilanthropyInvestment R

216、esearchFamily TrustThe most important success metric for family offices is:how well each portfolio achieves its predetermined risk-return objectives.These metrics are central to a family offices ability to deliver value,as risk-adjusted returns provide a measure of returns relative to the risks take

217、n,ensuring a balanced approach to investing.Meanwhile,growth in AUM reflects the family offices success in attracting and retaining wealth.This emphasis on balanced growth and risk management indicates that family offices are striving to maintain a strong foundation for sustainable financial perform

218、ance.At least 50%of the respondents highlighted that both growth in AUM and risk-adjusted returns are key performance indicators they rely on to assess their financial strategies and overall effectiveness.Family offices typically gauge their performance based on risk-adjusted returns and growth in a

219、ssets under management(AUM).According to the survey,these are considered the most crucial metrics for evaluating success.39Exhibit:Evaluating the performance of family officesQ:What are the performance metrics employed by you to evaluate your family office?Source:Sundaram-Eleveight industry interact

220、ionsRisk adjusted return on investment81%50%31%31%Growth in AUMTalent retentionLowering/optimising operating cost0%25%50%75%100%One prominent family office,prioritises investment realisation and calculates the IRR based on the actual cash flows and not the notional IRR,the IRR is calculated only whe

221、n the cash is realised.This emphasises their focus on generating real returns rather than just on-paper gains reflected in the AUM.40Among family offices,my perspective diverges from conventional metrics of success.Rather than solely assessing investment returns,I place greater emphasis on the found

222、ational structure and visionary thought processes driving the enterprise.How does the family office envision its role across generations?Is there a clear commitment to stewardship and preservation of capital?These are the questions that truly matter.Amol SatheHead-Investments,Thermax Family OfficeFa

223、mily offices also establish presence across global financial epicenters,especially,Singapore and Dubai.Singapore as a jurisdiction,in terms of compliance and regulation,is a little more regulated and matured.Most families are much more comfortable with Singapore than other jurisdictions.The number o

224、f Indians in Singapore also makes the clients more comfortable to operate from Singapore.For families who have children who are not in India,Singapore is easily accessible to them.41Indias maiden IFSC(International financial Services Centre),GIFT City is creating a lot of inquisitiveness among famil

225、y offices.All of them have garnered information on the potential opportunities offered by GIFT City.However,since the regulations are still being strengthened,family offices want to wait and watch before making a decision.of family offices are aiming to set up in GIFT City.40%Looking ahead,aboutWe b

226、elieve that to some extent,GIFT City may be the answer for global diversification and we are actively looking at the available products to take overseas exposure.As the GIFT regulations continue to evolve,we anticipate greater formalisation and clarity in the future.Niraj ShahHead,Fininterm Family O

227、ffice42From vision to action:Building the right governance structureFamily governance is a system of joint decision-making,most often by a family council and family board,which helps the promoter family govern its relationship with its promoter familys assets and businesses.The governance structure

228、in family office is further reinforced by tools like family constitution capturing the familys vision and important family values,family business protocols defining the family interaction with the business and setting the requirements for the employment/engagement of family members in the family off

229、ice,an ownership framework established through shareholders agreement/family settlement agreement.Expert non-family managers uphold the professional management standards,and an investment committee oversees wealth preservation and financial management within the family office.The governance of both

230、the promoter family and the family office are closely inter-connected,with the familys governing bodies,like the family council(comprising solely of family members),family board(including both family and non-family members),and family constitution,laying the foundation for the governance structure o

231、f the family office,which is further reinforced by entities like the investment committee and supervisory board.Getting it right means securing the future of both the family and its assets/businesses.Right governance matters:While family office segregates family wealth representing the family consti

232、tuent and the family business effective family office governance structure can enable the promoter family to interact with the family business in a manner that strengthens the overall governance framework for business entities and preserves the family legacy.Balancing family dynamics and business ob

233、jective:It is essential to delineate the roles of family members within the family office and establish clear lines of communication between family and family business enterprise with the family office serving as the bridge between both the constituents.Essence of right governance structureGood gove

234、rnance is as essential to family offices as it is to companies.In a family business setup,where wealth meets legacy and business continuity is desired,the governance structure of family,and by its extension of family office,serves as the compass guiding the journey through generations.Understanding

235、its nuances and structuring it right is critical for the enduring success of the family,family business enterprise,and the family office.This section has been written with inputs from Nehal Sheth,Co-Founder and Partner at M N S S&Associates and Neena Sharma,Senior Executive at M N S S&Associates Fam

236、ily office governance structure:Governing the family office/assets/family with a sense of purposeFamily office governance:Nurturing legacy and blueprint for business longevityCharting the success:Power of effective family office governanceSegregates family wealth from business interests,ensuring sta

237、bility and safeguarding assetsCultivates an environment of trust and transparency amongst the family membersFosters healthy relationships and effective communication in the familyRational economic and family welfare decisions that are not overwhelmed by traditional family dynamicsAnchors the relatio

238、nship between family members,shareholders and professional managersProvides a focal point for the family to continue to collaborate together on new ventures“Safe pair of hands”to manage things and help prepare the next generation for future leadership-Passing the batonEssential discipline for the lo

239、ng-term well-being of the family business and the familys wealthTypically includes an investment committee or supervisory board with family representation.Structure varies based on size and nature,with some utilising internal departments for specialised services.Families actively managing their busi

240、nesses face unique challenges compared to those managing private family wealth.Key tools:Family constitution,family councils/board,family meetings,shareholders agreement,investment committees.43Family councils/board:Governance body,akin to companys board of directors,addressing family centric matter

241、s.Best forum for achieving balanced ownership,family,and management dynamics,fostering positive interactions between the promoter family,family office,and family business enterprises.Non-family independent directors may enhance functionality,enabling the council to convene as a separate entity famil

242、y board for business related sessions.Family policy and constitution:Outlines family policies guiding the family-ownership-management relationship,codifying the broad principles for which the family stands and the wider aim for the family wealth.Provides policies for shareholder conduct,fostering un

243、ity and patient capital culture,especially in second-generation enterprises.While mainly moral with no legal standing,it holds significant sway on governance and functioning of family enterprises/family office,aligning with the familys intentions and goodwill.Supervisory board:The supervisory board,

244、comprising independent members from both family and non-family backgrounds,offers crucial oversight in the family office governance.Ensures adherence to governance standards and regulatory requirements,monitoring policy implementation outlined in the family constitution,to uphold familys values and

245、objectives.Investment committee:Investment governancethrough an investment committee and investment policy statementprovides a road map for effective investment and financial decision-making.Supports capital requirements of family business enterprises,and provides unbiased evaluation of project prop

246、osals.Facilitates new ventures in family:Serving as a springboard for inter-family entrepreneurial endeavours and new ventures of family members.Family meetings/assemblies:Family council meetings educate family members about business matters and guide the next generation in managing inherited wealth

247、,facilitating policy discussions.Provides family members a voice in business decisions,reducing pressure to exclusively appoint family members on the family office board allowing for professional experts involvement.Family Pillar Family constitution and policy statementFamily CouncilFamily OfficeFam

248、ily Assemblies/MeetingsBoard of DirectorsCEO/Managing DirectorTop ManagementBusiness EnterprisesFamily Board-Laying foundation for the overall governance structureInvestmentCommitteeFamily Venture Capital FundFamily Foundation Philanthropy ArmSupervisory BoardFamily office acts as an intermediary be

249、tween the family and the family officeFamily office acts as a link/interface between family and business enterprisesFamily Members+Non-Family ExpertsAlso includes representation from promoter family&family officeFamily Enterprise Pillar Mission&VisionDevelopmentFamilyConstitutionCreationGovernanceRe

250、structuringProfessional LeadershipThe family office establishes its mission and vision,outlining its strategic direction.Prior to the establishment of the family office,family members collaboratively draft and sign a family constitution,delineating the desired relationship between family,wealth and

251、enterprise for the future.The founder enhances governance by restructuring the family council to includethree independent outsiders,enabling it to function as a family board when addressing business,ownership and investment matters.A key non-family professional is recruited to lead the family office

252、,replacing the interim family member director.With the support of investment advisors and family business consultants,a sophisticated family governance structure is developed.Reporting StructureThe family office reports to the family council/family board through its non-familydirector/CEO,ensuring a

253、lignment with family objectives and values.Family office governance structuringConsiderations for effective family office governance:Asking the right questions44Whatever form the family office assumes,the governance structure should always be able to draw its inspiration,identity and vitality from t

254、he family it serves.It is,after all,the familys office.Family skills assessment:Do any family members possess the necessary skills and qualifications to manage the family office effectively?Consider external management,if necessary.What matters the most?Outline familys goals and objectives like char

255、itable giving,making a social impact on the world,and preparing the next generation for leadership positions.Quick closure to the process of developing the family constitution and policy:Prioritising understanding,sensitisation of the personal issues,and engagement with members is crucial.Commitment

256、 of all family membersCommunication is the key to effective governanceStructure simplicity:Avoid incorporating too many boards or committees.Early development:Start developing the governance plan for family office in the early growth stage/lifecycle of business and family.Exit strategy:Establish har

257、monious fair exit procedures for members not wishing to participate further in the family business or wanting to withdraw assets from family office.Wealth beyond finance:Consider human,social,cultural,and financial capital in decision-making.Internal-external conflict:Address conflicts between famil

258、y members and external service providers with appropriate governance structures and incentive mechanisms.Clear rules and roles:Establish clear guidelines for family meetings,voting rights,and investment decision processes,to promote clarity and accountability.Dispute resolution mechanism:Intra-famil

259、y disputes may arise over investment choices,the distribution of wealth,or spouses roles in discussions or the family business.Incorporating non-family professionals on the family board to provide diverse perspectives,independent from family dynamics.Preference for trust-based governance:Balance inf

260、ormal trust-based governance with formal structures as the family office evolves.Stress testing and scenario analysis:Apply the“What If”scenarios and factor the risk of“Key Person”dependency in the overall governance structure.Reviewing family constitution and mission statement:It is important to es

261、tablish a governance plan,but it shouldnt remain static.Rather,it should evolve and grow just like the family.Family council establishment:Defining member count and selection criteria based on family size,structure,and involvement in the decision-making process.Family board constitution:The family b

262、oard composition is determined by the family office structure,outlined in the articles of incorporation for companies or the trust agreement for trusts.Considerations for sub-committees:Deciding who can join,ensuring equal representation from all family branches,determining when children or later ge

263、nerations can participate,and establishing whether spouses and partners are allowed involvement.45CHAPTER 5Succession planningPreserving your legacy:Mastering generational wealth transition!Understanding family office&succession planning:In this ever-evolving landscape of Family offices,estate and s

264、uccession planning emerge as critical cornerstones,fortifying legacies,preserving hard-earned wealth,and safeguarding the financial futures of loved ones.Leveraging astutely designed planning tools,families can adroitly navigate the complexities of wealth transfer,ensuring their heritage transcends

265、generations with unwavering resilience.At its core,this process revolves around the judicious stewardship and distribution of an individuals assets,both during their lifetime and beyond.Is it an overarching objective?To facilitate the seamless,tax-efficient transfer of wealth to intended beneficiari

266、es,aligning with the grantors express wishes and aspirations.The perils of inaction(or)not having an estate/succession plan:In the absence of a meticulously crafted will or estate plan,the distribution of assets becomes subject to the vagaries of personal succession laws,a scenario rife with uninten

267、ded consequences.From court interventions that disrupt familial harmony to the application of forced heirship rules that may diverge from individual preferences,the repercussions of inaction can be profound.Effective planning demands a holistic approach,one that accounts for the nuances of asset own

268、ership,aligns with family intentions,and respects the intricacies of residency jurisdictions.Only then can the most suitable means of asset succession be identified and implemented.The pyramid of priorities:Akin to the architectural marvel of a pyramid,the requirements for individual estate and succ

269、ession planning are stratified into a hierarchical structure,each tier building upon the foundation below.Asset listing,aligning family aspirations,navigating residency laws,and selecting the appropriate planning tools form the cornerstones of this intricate endeavor.Pyramid of identified requiremen

270、tsSocial responsibilityCharitabledonationsFamily inheritorsPersonal estate planning Will or trust structure or a combination of bothIdentified beneficiary.Smooth and hassle-free transmission Asset protection Financial security Business succession Emergency needsEstate includes homes,cars,personal be

271、longings,bank accounts,retirement savings,investments life insurance,etc.Effective tax planning Ring fencing of assets Planning for minors Retirement beneftitsGuardianship of minors.Assets can be locked-in for future generations46The clarion call for having an estate/succession planning:While the ec

272、hoes of succession planning have long reverberated through the halls of multi-generational business empires,a new chorus has emerged.First-generation entrepreneurs,having scaled the precipices of wealth,now comprehend the imperative of seamlessly transitioning their legacies to the generations that

273、follow.Enter the family office,a strategic bastion designed to shepherd this transition with unwavering precision.Extending far beyond the realm of mere financial management,these offices address the intricate tapestry of business succession,family leadership,governance frameworks,and retirement str

274、ategies.By initiating a family office at the opportune juncture,UHNWIs unlock the potential for long-term planning,controlled risk management,and the tantalising promise of elevated returns.The multifaceted advantage of having one:1.Preserving privacy and confidentiality through the centralised fami

275、ly office2.Fostering transparent governance and management structures3.Harmonising the interests of related groups and future generations4.Unlocking the potential for higher returns through long-term planning5.Mitigating risks by proactively planning for contingencies Tailored tools for seamless tra

276、nsition:In the arsenal of succession planning,two formidable instruments stand resolute:Wills:These legally binding declarations articulate an individuals intentions for the distribution of their property upon their demise,serving as unwavering beacons guiding the transfer of wealth.Private family t

277、rusts:Autonomous entities dedicated to asset management,preservation,and intergenerational wealth transfer,as defined by the hallowed Indian Trust Act of 1882.These trusts serve as fortresses,safeguarding familial legacies for generations to come.While wills and trusts are powerful tools,its crucial

278、 to understand their distinctions:47Difference between a will and a trustPointersWillPrivate TrustThe legal declaration of the intention of a person with respect to his propertyEnforceable only post demiseAn obligation annexed to the ownership of property with the trustee for the benefit of the bene

279、ficiary,which is governed by the Indian Trust Act,1882 and Income Tax Act 1961Can be enforced even while a person is liveMeaningAll the assets of the testators are covered with control retained by the owner during lifetime with ownership passing to beneficiaries only post demiseSpecific assets,as st

280、ated in the trust deed.The Control and ownership depend on the kind of trust structure that is set upCoverage and control/ownership of assetsNot possibleDistribution can be planned in phased manner during and post lifetime of a personFlexibility for transition in phasesNot possibleCan be planned by

281、executing a suitable structureRing fencing of assetsNot possibleCan be planned by executing a suitable structureEstate tax planningNot possibleMandatorily required in 3 Cities,i.e.,Mumbai,Chennai and Kolkata Probate EffectiveBespoke trust structuring solutions can be meticulously tailored to address

282、 a constellation of objectives,from succession planning and safeguarding beneficiaries interests to asset ring-fencing,divorce planning,global citizenship acquisition,charitable endeavors,and the judicious management of intellectual property.The family office paradigm:In the Indian context,families

283、can opt to forge their own destinies through the establishment of single-family offices(SFOs),dedicated custodians of a single familys wealth,or embrace the collaborative spirit of multi-family offices(MFOs),which extend their services to a consortium of affluent clans.Industry experts assert that a

284、 net worth exceeding the INR 150 Cr threshold may warrant the establishment of a dedicated family office,allowing for the effective management of associated costs and ensuring resources are optimally allocated.Furthermore,these offices can explore innovative investment avenues such as Family Investm

285、ent Funds(FIFs)in GIFT City,enabling single-family offices to cast their nets across international waters while capitalising on tax benefits that further fortify their financial fortresses.Proactive estate and succession planning,anchored by the steadfast guidance of a family office,ensures the effe

286、ctive management,protection,and distribution of assets,minimising the spectre of taxes and potential hardships.Consulting legal,financial,and tax professionals is a prudent step,one that paves the way for the development of a personalised,goal-aligned plan a plan that fortifies your legacy for gener

287、ations to come.As the renowned Napoleon Hill sagely advised,Dont wait.The time will never be just right.Embrace the opportunity to sculpt your legacy,for it is through decisive action that generational wealth transcends the mortal coil,echoing through the ages as an eternal testament to your lifes w

288、ork.48This section has been written with inputs from Adv.Ms.Neha Rai Mathur SVP&Division Head,Family Office Services at Catalyst Trusteeship Limited.In family businesses,managing transitions across generations can bring about various challenges concerning both management and ownership.Its important

289、to anticipate these challenges and take proactive steps towards operational efficiency,role clarification,and addressing any interlinked ownership concerns.Through the establishment of effective structures,financial planning,supportive guidance,and legal frameworks,these businesses can navigate pote

290、ntial conflicts and optimise their potential for growth,fostering lasting success and cohesion.Sanjay KarkamkarCEO,Multi-Act Family Office49CHAPTER 6Key challenges and expectationsThe survey revealed that one of the primary challenges faced by family offices is attracting and retaining talent,with o

291、ver 55%of respondents finding this task particularly difficult.While not as significant,other challenges that family offices face include implementing technology solutions and ensuring tax compliance,both of which still pose obstacles for many in the industry.These issues highlight the complexities

292、involved in managing a family office and suggest that while some problems are more pressing than others,they all require careful attention and strategic solutions.Getting the suitable MIS and having the right service providers to build the right MIS which is structured towards Indian families and ha

293、ving some of these APIs which are linked to public markets that help to get the data in a centralised dashboard,helps family offices to get a birds eye view of the entire portfolio.Getting this right is a big challenge.On the AIFs side-For the unlisted category there is limited availability of infor

294、mation.A few funds share a lot of information but a few funds might not do so.Due to this lack of information the businessmen sitting in tier 2&3 cities who have huge pools of capital do not have much knowledge about this space,so it is important to educate them before they set up any sort of struct

295、ure of family office.Exhibit:Challenges faced by family offices50Q:What are the key challenges faced by your family office?Source:Sundaram-Eleveight industry interactionsAttracting and retaining talentPreparing the next generation to be responsible wealth owners56%25%25%19%Implementing technology so

296、lutionsTax complianceManaging costNavigating regulatory compliance0%20%40%60%19%19%Hiring talent is one of the major challenges faced by family offices.Since they are competing with larger brokerage houses and prestigious fund houses for the same talent,it is a challenge to get the right people.At t

297、imes,the remuneration or benefits offered by traditional family offices may also not be structured as lucratively as other corporations.The pedigree of talent matters a lot in family offices.Their capability to understand the nuances of investments as well as align with the vision of the family offi

298、ce are of utmost importance.Also to attract the best talent,the promoters are enhancing their professional approach.People prefer to work with leadership teams that are professional.A long-term dedicated team is essential for a family offices success.If a team member leaves,the family office loses t

299、he accumulated knowledge and experience they embodied.However,slowly and steadily as family offices become more institutionalised,the talent attraction and retention will become easier.Branding and positioning of the family offices is much more important,a well-developed brand helps them position th

300、emselves as a serious and active investor,potentially attracting new investment opportunities.Other challenges include,compliance burden in the forms of regulations like LRS and ODI create complexities for overseas investments and the tax implications that include navigating tax implications for ove

301、rseas investments poses a challenge for the tax advisors and chartered accountants.Half of the respondents believe that hiring young talent in the family office can help reduce overhead costs.Meanwhile,30%of the respondents think that investing in technology and outsourcing non-investment management

302、 functions,along with some low-value activities,could also be effective ways to manage expenses.Exhibit:Measure taken to manage overheads51Q:What are the measures taken by you to manage fixed overheads?Source:Sundaram-Eleveight industry interactionsHiring young talentInvesting in technologyPeriodic

303、vendor evaluationOutsourcing non investment management functionsOutsourcing some low value-adding activities50%30%30%30%20%While AUM can be a factor,family offices may not consider it the key indicator of a good investment manager.A stronger team,a solid investment process are all important consider

304、ations.Track record and the investment manager as a person,is more so to do with instead of the AUM.52According to the survey,88%of respondents expect investment managers to offer a better risk-return profile.Furthermore,50%believe that investment managers should communicate more frequently.Addition

305、ally,31-38%of respondents feel that investment managers should provide global market access and have higher levels of disclosure.Family offices evaluate investment managers by tracking the risk adjusted returns.The person who is in charge is important to them as well.They evaluate investment manager

306、s based on their integrity”.Investment managers should have the knowledge and should be better than the family office at something that they are not able to achieve in-house.The investment managers should be the masters of their domains and should have a no-nonsense approach.Exhibit:Expectations fro

307、m an investment managerQ:What are your expectations from an investment manager to add value to your efforts?Source:Sundaram-Eleveight industry interactionsBetter risk return profile100%80%60%40%20%0%More communicationLower feesHigherdisclosuresGlobal access88%50%44%38%31%CHAPTER 7Future aspects53Fut

308、ure outlook:Paving the way for family offices in indiaFamily offices in India are transitioning at warp speed,evolving into a critical wheel in the financial ecosystem.As they rapidly adapt and innovate,the broader ecosystem must gear up its efforts to match this evolution.Heres a look at the 4 Ps o

309、f what family offices need and what the ecosystem needs to deliver to support this transformation.54What the ecosystem needs to deliverWhat family offices needPeople 1Formal process of training new talent:Specialised education:Implement certification courses that address the specific nuances of fami

310、ly office investing,ensuring new talent is well-equipped to handle the unique challenges of this sector.Continuous learning:Offering ongoing education and training opportunities to keep professionals up-to-date with the latest trends and practices.Product2Quality and stable Talent:Longevity matters:

311、Beyond just attracting quality talent,the stability of decision-makers is crucial.Consistent strategy and long-term planning are vital for effective wealth management.Retaining expertise:Ensuring that skilled professionals stay within the family office is essential for maintaining a steady course in

312、 wealth preservation and creation.Exploring new ideas:Innovative investments:Family offices seek to allocate a portion of their wealth to explore new and untouched ideas,both in public and private markets.This fosters a culture of innovation and adaptability.Risk management:Balancing these explorato

313、ry investments with traditional,stable assets to manage risk effectively.Alternatives as a niche solution for specific product needs:Unique opportunities:Alternative Investment Funds(AIFs)need to identify and offer unique investment opportunities tailored to the needs of family offices.Co-creation o

314、pportunities:Encouraging co-creation between family offices and AIFs to develop bespoke investment solutions.As family offices in India continue to evolve at a rapid pace,becoming pivotal players in the financial ecosystem,it is imperative that the surrounding infrastructure adapts and grows in tand

315、em.By addressing the unique needs of family offices and delivering tailored solutions,the ecosystem can support their transition from wealth management to wealth creation,ensuring a prosperous and sustainable future for family legacies.55What the ecosystem needs to deliverWhat family offices needPla

316、tform3Curated family office tech:Tailored solutions:Tech providers must develop curated solutions for family offices,including Management Information Systems(MIS),Customer Relationship Management(CRM)systems,data analytics,and integration with execution platforms.Scalable technology:Ensuring that th

317、ese solutions are scalable and adaptable to the evolving needs of family offices.Partnership4Technology as support,not burden:Customised solutions:Technology should enhance operational efficiency,reporting,and analysis without becoming a cumbersome burden.Tailored tech solutions can significantly im

318、prove the functionality of family offices.User-friendly tools:Easy-to-use platforms that integrate seamlessly with existing systems.Partnership network:Valuing networks:Family offices rely heavily on their networks for support,guidance,and tactical decisions.Building and maintaining strong partnersh

319、ips is crucial.Collaborative environment:Creating an ecosystem where family offices can easily connect and collaborate with trusted partners.Partnership to enable the network:New service ecosystem:Develop a robust service ecosystem that includes legal,accounting,and tech services specifically curate

320、d for family offices.Holistic offerings:Providing comprehensive support that addresses all aspects of family office operations,from investment to administration.Depth of research:This report stems from surveys and interviews conducted with leadership team members/founders of esteemed family offices

321、in India.Insights were gathered through in-depth conversations and quantitative questionnaires.These primary findings were enriched by Eleveight and Sundaram Alternatess proprietary research,intellectual property,and client engagements.The research was carried out by Eleveight.Eleveight is a researc

322、h and consulting firm built on a foundation of robust research,analytical rigour,and succinct articulation.Eleveight specialises in empowering clients to make informed decisions through comprehensive primary and secondary research,strategic consulting,and execution support.Eleveights team comprises

323、researchers,industry experts,and practitioners with substantial experience in successfully delivering large-scale projects for clients worldwide and within local markets.56Reach out to us on:Upasana Koul,Co-Founder:Eleveight,upasanaeleveight.inDeepika Asthana,Co-Founder:Eleveight,deepikaeleveight.in

324、www.eleveight.in|infoeleveight.inSundaram Alternate Assets Ltd.(SAA)is a prominent entity within the illustrious Sundaram Finance Group,a trailblazer in the Indian non-banking finance sector.Founded over seven decades ago,Sundaram Finance,the groups flagship company,has earned its reputation as a pi

325、oneer in leasing and hire purchase and was the first NBFC to be listed in 1972.With a network of over 600 offices and more than 4,200 employees,Sundaram Finance maintains a strong market presence,further reinforced by its AAA rating for deposits from CRISIL and ICRA.SAA,a wholly-owned subsidiary of

326、Sundaram Asset Management Company Limited(SAMC),caters to the investment needs of high-net-worth individuals(HNIs),continuing the groups legacy of financial innovation and excellence.With cumulative assets under management of INR 6,762 crores(as of July 2024)Sundaram Alternate Assets specialises in

327、delivering customised solutions for long-term wealth creation through the platforms of Portfolio Management Services(PMS)and Alternative Investment Funds(AIFs).Under the aegis of Sundram Alternates PMS,we offer the following equity strategies:Our portfolios are crafted to meet the needs of investors

328、 seeking capital growth with a focus on quality.In the AIF space,we offer a comprehensive range of products across Category II and Category III.Our Category II AIFs include:High Yield Secured Debt Fund I(100%money returned to investors with gross investor IRR of 15.2%)High Yield Secured Debt Fund II

329、 High Yield Secured Real Estate Fund III High Yield Secured Real Estate Fund IV(Open for Subscription)Sundaram Alternative Opportunities Series-Emerging Corporate Credit Opportunities Fund IOur Category III AIFs include:ATLAS(Open ended fund)ATLAS II Acorn Sundaram India Premier FundThese AIFs are m

330、eticulously designed to address the specific needs of Family Offices,such as providing liquidity through consistent income distribution(CAT II AIFs)and offering high-quality,long-term investments through thorough research and evaluation.The ATLAS and High Yield Secured Real Estate Fund IV are curren

331、tly open for subscription,reflecting our commitment to providing timely and strategic investment opportunities.With a focus on collaborating with Family Offices,our products offer well-curated investment options that eliminate the need for extensive research,allowing them to achieve their financial

332、goals efficiently.Sundaram Alternate Assets remains dedicated to upholding the values and legacy of the Sundaram Group,delivering excellence and tailored solutions to our esteemed clients.About Sundaram Alternate Assets Sundaram India Secular Opportunities Portfolio(SISOP)-SISOP targets capital appr

333、eciation through a concentrated portfolio of high conviction multicap stocks Sundaram Emerging Leadership Fund(S.E.L.F.)-S.E.L.F.aims for long-term growth by investing in mid and small-cap companies.Voyager Voyager is a portfolio with abifocal approach blending compounding and opportunistic plays across multicap stocks Rising Stars Rising Stars invests in small cap stocks seeing high growth or cyc