A Dallas-based family just sold its logistics empire for US $480 million. They want the sophistication of a Wall Street endowment desk, but the numbers don’t pencil out. Building a single-family office would eat roughly 98 bps of their assets—about US $1.8 million a year—before investment fees even show up. Smaller teams simply can’t outrun fixed costs. The latest North America survey puts the figure at 42 bps only after a firm crosses the US $1 billion mark.
A multi-family office (MFO) changes that math. By folding six or eight families under one roof, the group buys Bloomberg terminals, cyber-defenses, and a tax counsel once, then slices the bill like sushi. Several MFO platforms now quote all-in operating expenses in the 35–55 bps range, meaning a sub-US $500 million clan can approach the efficiency of a billion-dollar standalone without waiting a generation to scale.
Many second-generation millionaires and billionaires are hiring offices shared with a few equally demanding neighbors
Institutional bench strength on speed-dial
Private-market analysts who have actually taken a company public. Estate attorneys who can thread Delaware, Cayman, and Guernsey into one trust diagram. A CIO who survived 2008 and still sleeps at night. An MFO’s talent pool resembles a mid-size pension plan because it is one—just privately held and obsessively client-centric. Families lean on that depth for everything from pre-IPO secondaries to structuring a carbon-credit fund for their kids’ foundation.
Cost curves that smile back
Run the pro-forma and you’ll see why it causes accountants to smile. Shared infrastructure tilts the expense line south in three high-impact ways:
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Headcount leverage – Staff is the priciest line item in any office. A seasoned controller or cybersecurity lead rarely costs less than US $250k. In an MFO, five families split that paycheck.
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Technology amortization – Wealth-aggregation software and private-equity data feeds run five-figure subscriptions. One license, many log-ins.
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Vendor bargaining power – Aggregated AUM pushes management-fee breakpoints lower. A US $2 billion MFO often negotiates sub-80 bps on hedge-fund sleeves that cost a lone US $200 million office 1.5 %.
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This means families keep a larger share of net returns without sacrificing professional polish.
Governance that survives holiday dinners
Succession planning goes haywire when no one wants to tell Uncle Leo he can’t day-trade the trust. MFOs enforce charters, voting rules, and investment committees the same way a private-equity LP agreement does. It’s boring on paper, but priceless when emotions flare. One family office CEO put it bluntly, “If you’re going to be honest, the biggest risk to most family offices is the family.”
Deal flow with a broader lens
When several families combine buying power, their office gets called on the best private deals. Co-investments into Series B robotics, secondary stakes in European infrastructure, direct lending to middle-market renewables show up because the MFO’s combined ticket size actually moves a manager’s needle. Families can still bow out of a given deal, but they see it first instead of cold-calling after the allocation is gone.
Cybersecurity and reporting that don’t rely on Aunt Lisa’s spreadsheet
Over-reliance on Excel was the #1 operational worry for North-American offices this year, outranking even cyber-attacks. Thirty-seven percent flagged spreadsheet sprawl, yet only ten percent reported an actual breach, thanks to widespread adoption of dual-authorization and two-factor protocols.
Most MFO platforms now pipe every brokerage, partnership, and art-storage invoice into a consolidated dashboard. The result? One click for time-weighted returns and a real-time warning when a wire instruction smells phishy.
Continuity you can put in the will
People move, founders age, children disagree. The MFO’s corporate charter endures. If a patriarch steps away, the office’s CIO still shows up Monday. The tech stack still reconciles positions overnight. And because the entity serves several families, a single exit doesn’t trigger a fire sale of talent.
Single-Family or Multi-Family Office?
Glance at the scorecard below. It lines up the perks and pitfalls of flying solo with a single-family office versus joining forces in a multi-family hub, so you can see which trade-offs matter most to you.
Key Take Aways for Wealth Managers
For advisors helping families navigate their office choices, three lessons matter most:
- Sizing is destiny
Below roughly US $500 million, a shared platform usually beats a bespoke build on cost, resilience, and breadth. - Governance sells
Families cite objective advice and structured decision‑making—not flashy investments—as their reason for joining. - Tech is table stakes
Reporting lag or weak cyber controls is the fastest way to lose a next‑gen client fluent in API‑level transparency.
In short, a well‑run MFO offers the horsepower of a university endowment with the bedside manner of a boutique. For many rising‑generation wealth creators, that’s the sweet spot. It requires no empire‑building and no corner‑cutting. It’s just a smarter way to turn complexity into compounding.
