M&A Talk (Mergers & Acquisitions), by Morgan & Westfield

Family Offices – What They Look for When Buying a Company

Nov 8, 2023

Explore the investment strategies and decision makers of family offices. Learn about their approach to evaluating potential investments and the advantages they have over venture capital firms. Discover the level of disclosure and privacy maintained by family offices. Gain insights on the different types of family offices and their focus on profitability and growth potential when buying a company.

01:06:27

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Quick takeaways

Family offices prioritize preserving capital while seeking consistent returns and often invest in industries where they have expertise and are comfortable.

Privacy and security are paramount for family offices, as they manage vast amounts of wealth and prefer to work with trusted professionals.

Family offices are increasingly interested in investing in private equity through the secondary market to have a say in company operations and avoid risks associated with the public market.

Deep dives

Family Offices as Potential Buyers

Family offices are one of the major buyers in the middle market, making up about 20% of activity in lower middle market deals. They are formed to represent the interests of wealthy families and have a variety of services to offer, including making investments. Family offices are often involved in investing in private companies and can potentially buy a middle market company. Understanding what a family office is and how they work is essential for business owners looking to sell their company in the middle market.

Introduction

3min

The Evolving Perspective of Family Offices

17min

Family Office Investment Strategies and Decision Makers

4min

Investment Approach and Evaluation in Family Offices

15min

Investment Competition: Family Offices vs. Venture Capital Companies

5min

Disclosure and Privacy in Family Offices

17min

Understanding Types of Family Offices and Insights for Business Owners

5min

In a return discussion of family offices, Alejandro Levy takes a deeper dive into the nuances of the family office and how they structure their investment strategies. Since family offices are major buyers of middle market companies, it’s important sellers understand what they look for in an investment and who the decision makers are within a family office. The discussion includes direct investments, investment trends in the secondary market, and the differences between family offices and independent sponsors.

View the complete show notes for this episode.

Learn More:

Additional Resources:

Planning to sell your business? Schedule a free consultation today.
Download a free PDF copy of The Art of The Exit: The Complete Guide to Selling Your Business and Acquired: The Art of Selling a Business With $10 Million to $100 Million in Revenue.
Purchase your copy now of A Beginner’s Guide to Business Valuation | The Exit Strategy Handbook | Closing the Deal
Contact Morgan & Westfield to request a free copy of Jacob Orosz's latest book, Food and Beverage M&A: An Insider's Guide to Selling a Food or Beverage Business.
To suggest guests, topics, or questions for future podcast episodes, contact Morgan & Westfield.

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