Raising capital from family offices
Single Family Office Mandate: Healthcare, AI and Distressed Real Estate
Healthcare, Telemedicine & Distressed Real Estate Single Family Office Investor Mandate Interview
Fund managers, operators and deal sponsors who want to understand how a physician-led single family office screens opportunities and what it wants to see.
Five points worth keeping
- Shorter holding periods now. Barry used to be patient and hold for five, seven or ten years. He now targets three to five years. He also reduced check sizes to one to three million.
- Co-invest with industry families. About 90 percent of his deals are with other families that are industry experts. He says this brings off-market deal flow. He says these partners also know where to sell and to whom, which in his experience can lead to larger exits.
- Healthcare and AI are the focus. As a physician, he favors digital health, telemedicine, EMR, AI and machine learning, and medical devices. He is applying AI to the insurance space, where he sees unnecessary testing raise premiums.
- Distressed real estate is next. He expects distressed commercial real estate to be the big theme in 2021 or 2022. He wants to meet the right people in that sector, such as special servicers and banks, rather than do it alone.
- Bet on the individual. He looks for operators with 20, 30 or 50 years of industry expertise. He wants a clear differentiator and checks references. If a sponsor cannot explain what makes them different, he usually walks away.
What you will hear
Barry runs a single family office based in Boca Raton and New York City. He is a physician by training. Since the pandemic he has cut his holding period from five, seven or ten years down to three to five years. His check sizes dropped from three to five million to one to three million, and he has made no investment since the end of January.
About 75 percent of his investments are direct and 25 percent sit in fund structures. Roughly 90 percent are made alongside other families that are industry experts. His interests include telemedicine, AI in insurance, medical devices, industrial warehouses and, later, distressed commercial real estate. Richard C. Wilson interviews him for the Family Office Club.
Facts from this talk
- Barry's check sizes fell from three to five million to one to three million, and he made no investment after the end of January.
- His mix is 75 percent direct investments and 25 percent fund structures, with about 90 percent done alongside industry-expert families.
- He checks references by asking for introductions to three or four other families who invested as LPs or GPs.
Sources
From Richard C. Wilson's Centimillionaire Strategies YouTube channel: Healthcare, Telemedicine & Distressed Real Estate Single Family Office Investor Mandate Interview. 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 fund structure choices, co-investment arrangements and distressed property acquisitions. Do not use AI to write your own legal agreements.
In their words
"75 percent of my investments are direct investments, 25 are in fund structures."
"Probably 90 percent of my investments are with other families that are industry experts."
"If I'm going to invest with you, I'm going to say, can you introduce me to three or four other families that have invested with you as LPs or GPs?."
Related questions
- How long does a family office take to make a decision?There is no standard timeline, and I would not trust anyone who gives you one number.
- How do I find the decision maker at a family office?Start by meeting the family through advisors, events and the people who manage their investments.
- Do family offices invest in funds or only direct deals?Family offices do both.
Questions about this video
How long does Barry want to hold investments?
He now targets three to five years. Before the pandemic he was more patient and let investments run five, seven or ten years.
What does Barry check before investing with a sponsor?
He checks references. He asks to be introduced to three or four other families that have invested with the sponsor as LPs or GPs, and he wants to know why they invested.
Which regions does Barry invest in?
He invests in the United States, Europe, South Korea, India and Israel. He says about 30 percent of his investments are based in Seoul, and he has invested in India for seven years.
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