Chart of the Week: Family office appetite for first time funds

More than 60% of participants are un-likely to invest with first-time managers next year.

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According to the second Annual Family Office and Foundation Private Equity Survey, family offices, like other investor groups have reported in other PEI surveys, are not keen on making allocations to first-time funds.

A firm seeking capital for its debut fund, by definition, is not able to point towards previous track record at a firm level.  However, family offices have to be more open for new ideas if they believe the quality of focus of the new or the investment strategy justifies it. According to one Asia-based single family office interviewed for this report:

“… it is not the case that we are blind investors writing a cheque. If the management team is good and well experienced then we would be happy to look at it. Track record [of the individual or company] for us is important but not the key driver of the investment making process”.

Another family office based in Asia explains:

“… first-time fund managers are hungrier to get the fund off the ground. We would not discount first- time fund managers but will have to feel very comfortable with their personal track records within their given space”.

The report is available for download in full here