Family Offices Expand Services To Keep Pace With Demand – Global Study

A new report, "The Family Office Operational Excellence Report 2025," reveals that nearly half of family offices have expanded their service offerings in the past two years, with family engagement and education being the most frequently added service. The study of 146 family offices globally also highlights talent acquisition as a major challenge, with cross-border complexities, particularly in tax and estate planning for non-resident family members, becoming increasingly important; while investment management remains core, operational models vary widely, with outsourcing leveraged mostly for public market investments.

Analysis

The family office landscape is undergoing significant evolution, as detailed in "The Family Office Operational Excellence Report 2025," which found that 48% of surveyed offices expanded their service offerings in the past two years, with family engagement and education emerging as the most frequently added service. This trend, alongside a growing emphasis on governance (a key focus for 62% of offices) and the adoption of new technologies for operational excellence and security, underscores a shift towards addressing complex family needs and ensuring long-term cohesion; however, educating the next generation remains a challenge, with nearly half expressing concerns about heirs' preparedness. Despite over 70% finding service expansion manageable, talent acquisition remains the largest operating expense and a primary concern, impacting the ability to deliver timely, high-quality results. Furthermore, the increasing globalization of families, with 57% of offices reporting members abroad, is heightening demand for cross-border support, particularly in tax (74%), investment (71%), and estate planning (68%). While investment management is a core function, 79% of family offices outsource at least some investment activities, predominantly public market investments, while often managing alternatives like private equity and real estate internally. The report, co-produced by AlTi Tiedemann Global (ALTI), also notes that 61% of family offices continue to own operating businesses, which frequently represent a substantial portion of family wealth.

Key Decisions for Investors

• Investors should assess opportunities in firms providing specialized services to family offices, such as AlTi Tiedemann Global (ALTI), particularly those focusing on high-growth areas like family engagement, cross-border advisory services for tax and estate planning, cybersecurity, and technology for operational excellence.
• The persistent talent squeeze within the family office sector may present headwinds for operational costs but creates potential for investment in specialized financial recruitment firms and HR technology providers catering to this niche.
• Asset managers should note the bifurcated investment approach of family offices, with continued outsourcing of public market strategies and a preference for internal management or direct investment in alternatives like private equity and real estate, tailoring their offerings accordingly.
• Given the increasing emphasis on formal governance, risk management, and succession planning, investors might consider entities that provide consulting and solutions in these areas, as family offices adapt to growing complexities and the need for generational continuity.