What Is a Multi-Family Office, Pros, and Cons

The accumulation of numerous competencies within a family office creates a kind of management center for all the affairs of a wealthy family. Such a service is most in demand among multi-generational families with large assets. Caring about the prosperity of future generations, heads of families resort to the help of professionals from multi-family offices (MFOs), which provide them with comprehensive consulting and management services.

What Is the Meaning of Family Offices?

The development of family offices (FOs) is similar to the development of other social institutions, such as universities, banks, hospitals, etc. For example, it is much more efficient to gather the best professors at a university and develop a curriculum than to expect students to go to different places in the hope of gaining the necessary knowledge. In the same way, a family office has emerged as the most energy-efficient form of comprehensive service for wealthy families. In the process of running a business, investing, legacy planning, engaging in philanthropic activities, etc., wealthy families need a variety of specialists:

• Lawyers
• Advocates
• Financial consultants
• Accountants
• Real estate specialists

You can seek help and advice from different agencies, but this is inefficient because you will have to explain your family’s affairs to a new company time after time. In addition, when dealing with many different firms, the likelihood of encountering fraudulent or unreliable service providers increases. If you contact a multi-family office with a good reputation and extensive experience, such as Certuity Company, you receive all the necessary assistance regularly. This means you will not have to be in a constant search for the right specialists, find out their reputation, control their activities, etc.

Main Functions of Multi-Family Offices

• Investment consulting, building a diversified portfolio, support of investment projects;
• Maintaining comprehensive reporting to ensure transparency of family income and expenses;
• Optimization of tax payments to minimize tax liabilities;
• Legacy planning for the most effective distribution of family assets between the next generations;
• Organization of trips, business meetings, receptions, and other events;
• Planning and implementing philanthropic activities, such as charity events, auctions, creation of funds, etc.;
• Reputation campaigns in the media and social networks to build a positive image of a rich family;
• Preparing new generations to accept and manage the family business and other family affairs.

As these services scale, MFOs increasingly rely on family office software to consolidate data across banks, custodians, and portfolios, produce transparent, drill-down reporting, and standardize workflows. For a practical overview of what to look for, including data aggregation, configurable import/export, and multi-asset coverage, see Limina, which details core capabilities tailored to MFO needs. The specific list of functions that a family office will perform for a particular client depends on the needs of the family:

• For example, one wealthy family may want to invest in the development of infrastructure projects on another continent. In this case, the task of the family office will be an in-depth analysis of the economic, political, and geopolitical situation in this region, the selection of a reliable project and its support.
• Another family may plan to establish a competition for amateur pianists as a humanitarian project. Then a family office will add this task to its list of duties.

Family Office Software has become broader over the years, now encompassing everything from investment tracking, through data aggregation to reporting – pioneered by vendors like Limina. For MFOs, adopting such platforms centralizes custodian and bank feeds, automates position and cash reconciliation, and standardizes consolidated client and regulatory reporting. These capabilities free advisers to focus on strategy and governance while ensuring real-time transparency across families, entities, and asset classes.

How a Multi-Family Office Differs from Other Types of Family Offices

The creation of single-family offices (SFOs) is usually initiated within a wealthy family to fulfill the needs of all its members. It often happens that one of its representatives becomes the head of such a family office.

Multi-family offices are independent companies that any wealthy family can contact. Such multi-family offices can take different forms, for example:

• Classic family office ultra high net worth (UHNW) focuses on supporting a small number of UHNW families.
• A network of family offices unites many local family offices under one brand. From such cooperation, local FOs receive reputational, organizational, and other support, and the head office gets access to the market of FO services in various regions. Such offices have a wider client base, as they serve not only UHNW families but also clients with lower incomes.
• Virtual family offices are the most recent type of companies aimed at servicing wealthy families. They work based on tariff plans, so you can choose one or another service package depending on your needs.

Is It Worth Using the Services of a Multi-Family Office?

Linda Gallo, PhD in clinical/health psychology, cites research showing that financial issues are the number one source of stress for Americans regardless of their economic background. Wealthy families know what money-related stress is but often do not have efficient solutions to mitigate it. Turning to family office services can be a great tool for getting rid of this and many other sources of stress. But before making a final decision on the services of a multi-family office, you need to weigh the pros and cons.

The filigree professionalism of family office employees and their 24/7 readiness to help in any matter make them indispensable assistants for wealthy families. MFOs help not only with current issues that contribute to the prosperity of wealthy families. They help make their clients’ dreams come true and often become the springboard by which the family reaches new heights.