What role do family offices play in growth financing?

Family offices are play­ing an incre­asingly rele­vant role in the growth finan­cing of promi­sing growth compa­nies. The main reasons for this are the conti­nuing finan­cing vacuum in venture capi­tal, the incre­asingly diffi­cult invest­ment envi­ron­ment in almost all other asset clas­ses, and the resul­tant strong impro­ve­ment in the rela­tive and also abso­lute perfor­mance of venture capi­tal and growth finan­cing. While the median IRR of the global VC indus­try was a meager 3% in 2007, this has risen to an impres­sive 16% in 2017. In addi­tion, family offices (Fos) are stra­te­gi­cally well posi­tio­ned for growth finan­cing with their often “deep pockets” while main­tai­ning a long invest­ment hori­zon. If these are growth compa­nies that are rela­ted to the family office’s former or current core acti­vi­ties, family offices are also a very attrac­tive part­ner for growth companies.