Family offices were once discreet custodians of generational wealth. In 2025, they are fast-moving, capital-rich operators reshaping global investment markets. UBS reports that the average family office now oversees about USD 1.1 billion in assets. With over 3,000 single-family offices worldwide managing more than USD 4.7 trillion, their footprint rivals that of institutional investors (UBS Global Family Office Report, 2025).

These organisations are no longer passive. They are assertive, and increasingly independent of traditional financial intermediaries.

Capital in motion

Institutional capital often moves slowly. Family offices do not. A BNY Mellon survey of firms with over USD 1 billion in assets found that two-thirds plan to increase direct private equity exposure in 2025. Nearly 75% have already entered crypto markets or intend to do so this year (BNY Mellon Wealth, 2025).

Speed has become a strategic asset. FundPlaybook reports that 44% of family offices are planning to raise real estate allocations, even amid higher interest rates. By contrast, banks and pension funds remain cautious (FundPlaybook, 2025).

Entrepreneurial advantage

Many family offices originate from business builders. That lineage matters. EQT Group data shows that 17% of family office portfolios consist of direct private equity, compared to just 10% for comparable managed funds. Among larger offices, nearly half of those deals involve controlling stakes (EQT Group, 2025).

These investors are often hands-on. They provide capital, strategic guidance, and industry expertise, sometimes over decades. The goal is not exit, but long-term value.

A longer horizon

Family offices are patient. A FundPlaybook survey found that more than half of respondents intend to hold real estate investments for at least six years. About 40% expect to maintain them for a decade or longer. Only 3% anticipate exits within three years. Meanwhile, public equities now comprise just 15% of portfolios, down from 19% in 2024. Offices continue to reallocate toward private credit, digital assets, and direct stakes (FundPlaybook 2025; BNY Mellon 2025).

Governance evolves

Professionalisation has followed growth. Deloitte’s 2025 report shows that 73% of family offices now include independent professionals on their boards. BNY Mellon found that 64% plan to complete six or more direct deals this year, a signal that internal capabilities are maturing alongside investment ambitions.

Boards once seen as a formality are now critical. They help offices manage generational transition and operational scale.

Allocation priorities

Real estate remains a mainstay. Offices managing under USD 1 billion report an average allocation of 54%. For those above that threshold, it rises to 62% (Barron’s / BNY Mellon, 2025). Private equity accounts for 28% of large-office portfolios. Private credit, hedge funds, and crypto round out the mix. Outside the US, crypto holdings rose by 75% year-on-year, often structured through tokenised or thematic vehicles (BNY Mellon, 2025).

In impact investing, family offices are becoming pivotal. In Spain, one in four start-ups now counts family capital among its backers. ESG considerations are embedded in investment policy across Europe and Asia (PwC Global Family Office Deals Study, 2025).

Technology as infrastructure

Passive investing is gaining renewed interest. Many family offices balance active direct deals with low-cost thematic ETFs, particularly in AI, biotech, clean energy, and web3-linked sectors. Empaxis and bfinance report that ETF adoption reflects a push for efficiency and optionality. Dashboards now allow boards to compare strategies in real time.

Some offices are experimenting further, exploring tokenisation, DAO participation, and early-stage funding through decentralised platforms. These tools offer speed, access, and flexibility.

Venture capital reframed

Family offices are entering venture markets not just as limited partners, but as lead investors. While most still cap venture allocations in the single digits, BNY Mellon data shows that 64% expect to execute multiple direct VC transactions in 2025. Demand for digital health and biotech has surged post-pandemic. Hubbis reports that digital health now ranks among the top five themes for Asia- and Europe-based offices (Hubbis Global Insights, April 2025).

Preparing the next generation

Succession remains a priority. Around 70% of offices cite next-generation engagement as a key concern. Yet only half currently involve younger members in core investment decisions (Empaxis, 2025).

This is beginning to shift. More next-gen family members now sit on investment committees, contribute to ESG policies, and champion future-facing mandates. Values and capital are converging.

Recognition from the outside

Institutional investors have taken note. In 2025, Coatue Management raised USD 1 billion from family offices alone to launch a cross-market tech fund. Participants included capital from families linked to Jeff Bezos and Michael Dell.

In Australia, the Victor Smorgon Group reported a 54% return on its inflation-hedged gold strategy for FY 2025. The outperformance reflected early positioning, not reaction.

The shift underway

This is not merely capital preservation. It is a strategic reinvention. Family offices now operate with clarity of purpose and a willingness to act without delay. They hold direct equity, use thematic ETFs, deploy digital assets, and apply governance frameworks tailored to cross-generational wealth.

Legacy no longer means stagnation. In 2025, it means leadership.

Read the original article here.