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YOUR FAMILY OFFICE FUTURE


Many of these new wealthy are ABCs (Australian Born Chinese) or CBCs (Canadian Born Chinese). If they are born in China, many have been educated in the UK, Canada, Australia or the US. Either way, they understand that global markets offer diversification. But how do they harness these benefits?


opportunities. And family-operated businesses – some 90% of all enterprises in the region – are creating more wealth than ever before. This powerful dynamic has created a shift in thinking


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towards wealth-risk management and protection, and has highlighted the demand for new, flexible and confidential global solutions. In short, family businesses are very interested in


wealth preservation, succession planning and protecting Family Wealth for future generations.


The ABCs of this new wealth Many of these new wealthy are ABCs (Australian Born Chinese) or CBCs (Canadian Born Chinese). If they are born in China, many have been educated in the UK, Canada, Australia or the US. Either way, they understand that global markets offer diversification. But how do they harness these benefits? They are looking for impartial and reliable global structuring and international investment advice. Will it be sought through the ‘standard’ channels of fund managers, financial advisers, private banks or institutional asset managers? No. With some 20,000 funds, the challenges of researching geographic and asset-class options can be overwhelming to a non-finance investment professional. An entrepreneur who has been a property developer, manufacturer or other successful businessperson for 20 years may not have had need or time to study global asset allocation. This ‘new wave’ of entrepreneur is, however, open


to professional expert guidance. But they want to balance this with their own analysis; they do not want to relinquish responsibility or control lightly. These people are the first and second generation of a new ultra-rich elite. The traditional and trusted model of going direct to a well-regarded private bank for advice today must coexist with a new demand for control, privacy, security and diversification.


sian GDP growth rates may have dipped from their giddy pre-GFC heights, but China – still growing at 7% PA – is providing and supporting huge wealth-creation


The IFOA solution Comparative analysis and direct communication is quick and inexpensive. But how to ensure research is well-compiled, reliable and objective? The International Family Office Association is a not-for-profit organisation offering screening and peak due diligence. The IFOA vets service providers and advisers, and is fast becoming the specialist ‘go-to’ group. The IFOA is in the early stages of creating a global


platform for a previously fragmented service among private groups. It will be a crucial platform because of the many new entrants into the sector, and because the most exciting and profitable investment opportunities are increasingly in the emerging and frontier markets. We certainly see capital being globalised, and that capital seeking out reliable ‘private’ counter parties. This was once the sole domain of investment consultants and private bankers. It is now becoming democratised by the capability of internet-supporting specific interests. As the disintermediation of private banks and investment banking clubs continue, we will continue to see the rise of online deal-matching platforms. But who will screen and provide the due diligence


on such investment opportunities? Clearly the internal CIO and specialist Family Office adviser sector will continue to become more professional,





This powerful dynamic has created a shift in thinking towards wealth-risk management and protection, and has highlighted the demand for new, flexible and confidential global solutions.


FAMILY OFFICE: THE FUTURE 13


YOUR FAMILY OFFICE FUTURE


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