Are you marketing to the Multi-Family Office (“MFO”) or Single Family Office (“SFO”) space? Below are some considerations to keep in mind as you focus your distribution strategy on this target market.
Relationships: Most family offices take a holistic approach to investment opportunities, with a focus on the personal rapport with the manager and other individuals at the firm. Family offices are inundated with an increasing number of managers. Given the volume, the various strategies and the differences between them, managers can easily become indistinct. Selecting one manager over another often comes down to the right fit. Marketing to the family office segment often requires a level of trust built upon a foundation of relationships.
So, how do you get family offices to take a shine to you and also ensure they understand your investment strategy? Oftentimes a worthwhile approach can be to combine social interactions with focused professional sessions. During office interactions, you are learning as much as you can about the allocator’s business history, goals, and beliefs while educating them about your strategy’s opportunity set. You should also spend time developing a relationship of trust while learning about them as individuals which can be achieved at industry events, conferences and other social gatherings. The entire process could take an average of 36 months to become effective and give you a slight edge over your competitors after the initial three year period.
Office Meetings: The first meeting should be a fact-finding expedition about the family office’s business. If the first meeting is an hour, at least 30 minutes of it should be spent understanding their business and any distinctive interests the office looks to foster. Start by asking allocators about their background and story. The answer to that question and the ensuing discussion will be incredibly informative. Once you transition to talking about your firm, ensure that you can convey what specifically makes your strategy or firm unique early and succinctly. Take care to avoid investment presentation clichés (i.e., “Our research process is unique”…, “Our years of experience is an advantage”) when describing what sets your firm apart from the competition. Discuss your process but understand that it is likely to be similar to other managers concernments presenting to the family office so refine your strategy’s distinctive advantage down into a few concise points.
Outside the Office: Do not immediately pitch your firm and strategy every time you meet. If you have met with a prospect a handful of times at their office and you see them at an industry event or you invite them to social functions, avoid leading the discussion with your fund. Instead ask about them. When they ask about you, which most people will do as a course of normal polite conversation, mention an upbeat brief anecdote about you personally (i.e., kids just left for summer camp.) Use that to transition the conversation back to them (i.e., If I remember correctly, your kids are heading to college at the end of the summer?) This sounds intuitive to most, but unless they ask about your business specifically it is best to focus on building a genuine personal relationship with the individual.
Family offices are varied, with limited information and opportunities to get in front of them. The aforementioned remarks are a small part of what should be a larger, well-honed strategy to help position you and your firm.
Please reach out to your Relationship Manager or email email@example.com with any questions.
This article is not a solicitation of any investment product or service to any person or entity. The content contained in this article is for informational use only and is not intended to be and is not a substitute for professional financial, tax or legal advice.