Family Office Mandate: Non-Correlated Managers and Market Views
Single Family Office Investor Mandate Interview - Focused on Alternatives, Banking, Private Equit...
Fund managers and sponsors who want to understand how a multi-member family office group screens managers and thinks about market dislocation.
What you will hear
A group of 35 family offices meets twice a month to vet investment ideas, and it has reviewed more than 500 managers in 11 years. Each member still makes their own decision, but the group shares due diligence. The guest also runs their own family office. They describe the mandate as non-correlated, absolute return managers in niche spaces, with extra interest in sectors hurt by market dislocation.
The talk was recorded during the early virus period, so much of it covers market conditions at that time. The guest sees ongoing stress in real estate, expects big banks to do well, and thinks private equity will shift toward public company stakes such as PIPE deals and convertible preferred. Richard C. Wilson and the guest also discuss older wealthy consumers, biotech and self storage.
What stood out
- Shared diligence, separate decisions. The group has 35 family offices and meets twice a month. Members share the due diligence and evaluation process, but each one decides for itself.
- Non-correlated managers are the core mandate. The guest looks for absolute return managers in niche spaces. These once meant strategies like convertible, bond or merger arbitrage, but the guest says there are now many more niches that do not track the S&P or the NASDAQ.
- Dislocated sectors may offer an edge. The guest believes some sectors can perform well because they were already dislocated. Real estate and securitized real estate deals are named as areas where the shake-out is far from over.
- Big banks seen as likely winners. The guest expects wide spreads and high trading volume to help large banks, as in 2008. Smaller banks without other business lines may not survive and may be absorbed in consolidation.
- Private equity expected to change. The guest expects defaults, bankruptcies and litigation among companies levered seven times. They also see private equity firms moving into PIPE and convertible preferred deals in public companies.
In their words
"Each member makes their own investment decision, but we share the due diligence and evaluation process."
"I think the private equity business is going to change and we're already seeing it."
"They're going to buy stakes in public companies hopefully at a discount and then get registration rights and sell."
From the source
- The group is made up of 35 family offices and has operated for 11 years.
- In that time the group has vetted more than 500 managers.
- The guest expects litigation over 7x levered companies to last another 10 years or more.
Sources
From Richard C. Wilson's Centimillionaire Strategies YouTube channel: Single Family Office Investor Mandate Interview - Focused on Alternatives, Banking, Private Equit.... Quotes come from the video captions, lightly edited for readability. Figures are the speakers' own estimates and experience.
General education only. Not legal, tax or investment advice.
Talk to a securities attorney to explore options around PIPE deal structures, registration rights and investor eligibility rules. Do not use AI to write your own legal agreements.
Related questions
- How do I close a funding round?I close a funding round by focusing on investors who fit the opportunity and moving each interested prospect through clear, consistent follow-up.
- What documents do investors request during due diligence?Prepare a clear, organized package covering your operations, investments, compensation, team, and track record.
- How do I raise capital for my business?I raise capital by building a repeatable system for attracting the right investors, establishing credibility, and developing relationships before asking for money.
Questions about this video
What does the guest's family office group look for?
The guest typically looks for non-correlated, absolute return managers in niche spaces. They also favor sectors that may perform well because of existing dislocation.
How does the 35-member group make decisions?
The group meets twice a month to vet investment ideas. Each member makes their own investment decision, but the members share the due diligence and evaluation process.
What does the guest expect from private equity?
The guest expects private equity to shift its business model, with more PIPE and convertible preferred deals in public companies. They also expect defaults, bankruptcies and litigation around companies levered seven times.
Put this into practice with the family office fit check. See all investor mandates resources.
