#267
Family Affair

Published:

Dec 15, 2018


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Published:

Dec 15, 2018


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Family offices, or entities that manage money for one or more families, are booming. They represent trillions in assets, and the biggest now compete with major private equity and venture capital firms for investments. The number of family offices has grown rapidly, with approximately 2/3 of all family offices being created after the year 2000.

This growth in family offices mirrors the growing wealth of the world’s billionaires, which has accelerated from about $1.7 trillion in the year 2000 to over $9 trillion today. The Economist estimates that $3-4 trillion of this wealth may reside in family offices.

The growth in family office capital has been driven by liquidity events that mint billionaires and the increased appeal of the family office structure in China. The wealthiest families may also have become disillusioned with some third-party money managers, instead opting to hire their own talent to deploy capital.

One unique aspect of family offices is their flexible investment mandate, as they do not answer to external LPs. As a result, many family offices make bets across a wide variety of asset classes and sectors.

And in the world of private equity, family offices can have a strong value proposition for target companies. Family offices are often long term and very patient capital.

Now can we use tech to bring the family office party to everyone?


Portfolio News


Facing consumers' fears: how fintechs target money anxiety - MoneyLion's "financial heart" is helping consumers monitor the real-time state of their finances in the same way that a Fitbit or EKG monitor would monitor their health, effectively giving a measure of their financial stress. The company has also announced it has launched a version of its product that employers can offer to employees. Read more

UMA  - enabling Universal Market Access - Congrats to Hart Lambur and Allison Lu for lifting the veil on portfolio company Risk Lab's first use case for real-time margining on any financial contract using blockchain technology. Similar to how HTTP allows information to move across borders, UMA will allow risk to move across the internet without a central authority or single point of failure. Read more

Podcast 179: Lowell Putnam of Quovo - Lowell Putnam, CEO of portfolio company Quovo, discusses the data infrastructure his startup is building to enable services that help consumers make healthier, more data-driven financial decisions. Read more

Tradeblock announces new indices - Portfolio company Tradeblock has launched indices for EOS, Stellar, and Moneyo - to complement their existing suite of indices. Tradeblock produces robust reference rates that are used broadly by industry participants for crypto pricing. Read more

Family Affair


The Economist: family offices become financial titans - Family offices represent trillions in assets, and the biggest now compete with major private equity firms on big transactions. And the number of family offices has grown rapidly, with approximately 2/3 of all existing family offices created after the year 2000. Read more

Industry News


Robinhood launches checking and savings with 3% interest rate - In addition to the 3% yield, Robinhood customers will have access to 75k ATMs and around-the-clock customer service. Read more

Robinhood said to not be properly insured to offer checking & savings- Securities Investor Protection Corporation, a non-profit membership corporation that insures stock brokerages, tells TechCrunch its insurance would not apply to Robinhood checking and savings accounts. Read more

2018’s tech trends and tribulations in 14 charts - Recode has captured 2018’s tech tribulations and trends in 14 charts. Read more

Crypto suffers a black eye after a buzzy $130m project crumbles - Basis raised $133m this April from Andreessen Horowitz and Alphabet’s GV to build a “stablecoin”. The project is now shutting down in the face of increasing US regulatory scrutiny of stablecoins. Read more

Kids in China are trying every trick in the book to beat facial recognition software - This article gives us a glimpse into the future, highlighting how kids are using photos of sleeping relatives to try to circumvent China's facial recognition software. Read more

Winklevoss twins ignore crypto 'winter,' looking toward 2019 - The founders of institutionally focused Gemini exchnage are putting their attention towards expansion in Asia and its new mobile app, but did acknowledge that volumes on Nasdaq and CME's Bitcoin futures so far were certainly underwhelming. Read more

Mike Novogratz explains why he’s still all-in on crypto - The former Goldman Sachs partner and hedge fund manager sits down with Bloomberg to chronicle the wild ride of the last 18 months in cryptocurrency. Unsurprisingly, Novo is still undeterred by the drop. Read more

Michael Spencer buys $52m controlling stake in life insurance startup Singapore Life - One year old Singapore Life offers a variety of term life and universal life policies and sells them online and through private banks and brokers. The company claims to be Singapore’s fastest growing life insurer with $6.6 billion of coverage sold to date. Read more

Lithuania license lets Revolut launch banking products - Revolut has secured a European banking license from regulators in Lithuania, allowing the pre-paid card provider to start offering current accounts and loans across the EU from early next year. Read more

The messy political story of Bitcoin - A good short read on how the collapse in crypto prices has shown that decentralization is not only an economic story but also a political one too. Techno-utopia is messy as code is better at enforcing rules than setting them. Read more

Select Financings


AccessFintech – Israeli financial error proofing startup has raised $17.5m in Series B financing from Goldman Sachs, J.P. Morgan and others. Read more

Good Money - California based digital banking platform owned by its customers raised $30m in Series A funding led by Galaxy Digital via its Galaxy EOS VC Fund with participation from Breyer Capital, Blocktower Capital, Boost VC, and Blockchange Ventures. Read more

Guideline - San Francisco based 401(k) startup has raised a $35m Series C led by Tiger Global.  Read more

ShopKeep - New York based mobile point of sale startup has raised $65m in equity and debt financing led by Tribeca Venture Partners. Read more

TransferGo - London-based international money transfer startup has raised $17.6m in Series B funding led by Vostok Emerging Finance. Read more


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