Single vs Multi-Family Office: Everything You Need to Know

You’ve built significant wealth, and now you’re facing a decision that will shape how your family manages that wealth for generations: should you establish a single-family office or join a multi-family office? 

This isn’t just about picking a wealth management service—it’s about choosing the foundation for your family’s financial future.

The choice between multi-family office vs single-family office structures has real consequences. Get it right, and you’ll have a system that grows and protects your wealth while aligning with your family’s values. Get it wrong, and you could end up paying too much for services that don’t fit your needs, or worse, watching your wealth erode due to poor management.

Let’s cut through the industry jargon and examine what each option actually means for your family.

Your Family Office Options

Single-Family Office

A single-family office is a private organization dedicated exclusively to managing one family’s wealth. Every decision, every investment, and every strategy revolves around your specific goals.

Single-family offices typically serve families (and high-net-worth individuals) with significant wealth (usually $100 million or more) because the operational costs can add up. You’re essentially building your own wealth management company, complete with investment managers, tax specialists, estate planners, and administrative staff. 

Modern single-family offices manage more than just investments. They handle everything from tax planning and tax services to estate management, family governance, wealth transfer planning, philanthropic planning, personal services, and even concierge services. Some families use their single-family office to coordinate charitable giving, manage family business interests, and prepare the next generations for wealth stewardship.

Multi-Family Office

A multi-family office takes a different approach. Instead of serving just one family, these organizations provide wealth management services to multiple clients—typically anywhere from 10 to 50 families, depending on the firm’s size and focus.

Multi-family office services are as comprehensive as single-family offices, but they spread the costs across families. This cost sharing model makes sophisticated wealth management accessible to families who might not have the resources to justify their own dedicated team.

The multi-family office structure creates some interesting dynamics. Families benefit from shared resources and expertise, but they also share access to investment opportunities and can learn from other families’ experiences. Many multi-family offices facilitate networking among their client families to create communities of like-minded wealthy families.

However, multi-family offices must balance the needs of multiple families, which naturally limits how much they can customize comprehensive financial services for any single-family. What works for one family might not work for another, so these organizations typically develop standardized processes and investment strategies that work reasonably well for most of their clients.

Single-Family Office vs. Multi-Family Office

Control and Customization

Single-family offices give you complete control. Every investment decision, every hiring choice, every policy decision flows through your family. Want to avoid certain investments for ethical reasons? Done. Need to structure investments around your family business liquidity events? No problem. Have complex family dynamics that require specialized governance structures? Your team can build exactly what you need.

Multi-family offices offer less control but more professional management. You’ll have input on investment strategies and can often customize certain aspects of your portfolio, but you’re not making the day-to-day operational decisions. For many families, this is actually a benefit—you get professional management without the burden of running your own organization.

Cost Considerations and Efficiency

The cost difference between single-family office vs multi-family office structures is significant and often misunderstood. Single-family offices require substantial upfront investment and ongoing operational costs. You’re paying for dedicated staff, investment advisors, office space, technology systems, compliance infrastructure, and all the overhead that comes with running a private organization.

Most experts suggest that families need at least $100-250 million in investable assets to justify a single-family office from a pure cost perspective. Below that threshold, the annual costs (typically 1-2% of assets) may not provide sufficient value compared to alternatives.

Multi-family offices spread these costs across multiple families, making the economics work for families with lower asset levels—typically $25-100 million. That doesn’t mean multi-family offices are always cheaper, though. High-quality multi-family offices serving ultra-wealthy families can be quite expensive, and some charge fees comparable to single-family office costs.

Access to Investment Opportunities and Expertise

Single-family offices can pursue any investment opportunity that aligns with your family’s goals and risk management tolerance. With sufficient assets, you can access direct investments, private equity deals, hedge funds, and other alternative investments typically reserved for institutional investors. Your investment team can also develop specialized expertise in areas that matter to your family.

Multi-family offices often provide broader access to investment opportunities because they pool resources across client families. A $50 million family in a multi-family office might access investment opportunities typically reserved for much larger investors. Multi-family offices also maintain relationships with investment managers and can negotiate better terms due to their combined assets under management.

However, multi-family offices must consider the needs of all client families and their financial affairs when evaluating investment opportunities. An investment that’s perfect for your family might not work for other families in the office, limiting your access to highly specialized opportunities.

How to Choose the Right Family-Office Structure

Family Complexity and Dynamics

Consider your family’s structure and dynamics. Large families with multiple generations, complex business interests, or significant family governance needs often benefit from the customization available through single-family offices. Smaller families with straightforward wealth management needs might find multi-family offices perfectly adequate.

Family members’ involvement levels matter too. If family members want to be actively involved in investment decisions and wealth management, a single-family office provides more opportunities for engagement. If family members prefer to remain passive investors, a multi-family office’s professional management might be preferable.

Wealth Level and Growth Trajectory

Your current wealth level obviously matters, but consider your wealth trajectory too. If your wealth is growing rapidly—perhaps through business success, inheritance, or other factors—you might want to choose a structure that can accommodate that growth.

Families with $25-100 million might start with a multi-family office and transition to a single-family office as their wealth grows. Families with $100+ million can choose based on preferences rather than purely economic considerations.

Investment Philosophy and Objectives

Your investment philosophy plays a crucial role. Families with strong environmental, social, or governance (ESG) preferences, specific risk tolerances, or unique investment objectives often need the customization available through single-family offices.

If your family prefers a more hands-off approach to investing and trusts professional managers to make decisions within broad guidelines, multi-family offices can work very well.

Geographic and Operational Considerations

Consider where your family lives and how you want to interact with your wealth management team. Single-family offices can be located anywhere and structured to serve your family’s geographic needs. Multi-family offices typically require you to work within their existing geographic footprint and operational model.

Some families prefer local relationships and regular face-to-face meetings, while others are comfortable with virtual relationships and periodic meetings. Your preferences should influence your choice of structure and specific organization.

Common Mistakes to Avoid When Choosing Your Office Structure

Here are a few mistakes families run into when deciding on their structure:

1. Choosing Based on Status Rather Than Function: Don’t choose a single-family office just because it seems more prestigious or a multi-family office just because it’s more cost-effective. Choose based on which structure best serves your family’s actual needs and objectives.
2. Underestimating the Management Burden: Single-family offices require governance and oversight from family members. Don’t assume you can set up a single-family office and forget about it. You’ll need to hire, manage, and oversee your team, make strategic decisions, and double-check the organization serves your family’s evolving needs.
3. Focusing Only on Investment Performance: While investment performance matters, it’s not the only consideration. Traditional family office services extend far beyond investment management, and the best investment performance won’t compensate for poor service in other areas that matter to your family.
4. Failing to Plan for Succession: Consider how your choice will affect future generations. Will your children and grandchildren be prepared to manage a single-family office, or would they prefer the professional management of a multi-family office? Build succession and financial planning into your decision-making process.

Your Next Steps

Choosing between a single-family office vs multi-family office isn’t a decision to rush. Take time to understand your family’s needs, evaluate your options carefully, and consider how your choice will serve your family’s long-term objectives.

Start by clarifying what you want to achieve through professional wealth management. Then evaluate both single-family office and multi-family office options that might serve those objectives. Don’t hesitate to engage multiple organizations in preliminary discussions—most traditional wealth management firms welcome the opportunity to explain their approach and help you understand whether they’re a good fit for your family.

Remember, this decision isn’t permanent. Your family’s needs will evolve, and the wealth management industry continues to innovate. Choose the structure that serves your current needs while keeping options open for the future.

The right choice will provide your family with more than just investment management. It will give you confidence that your wealth is being managed thoughtfully, your family’s values are being preserved, and future generations are being prepared for their roles as stewards of the family’s legacy.

Frequently Asked Questions