Beruflich Dokumente
Kultur Dokumente
By David Drake
majordomo as well. Hence, the concept of administratorship was invented, and has prevailed until
today. The modern concept and understanding of family offices was developed in the 19th century. In
1838, the family of J.P. Morgan founded the House of Morgan, which managed the familys assets ,
and the Rockefellers founded their family office in 1882, which prevails until today.
more long-term with an aim to create family legacy rather than short term profits. Chances of fraud
and insider trading are much less in family businesses as the reputation of the entire family is at
stake. The clients of family offices are likely to have personal relations with the family, and a sense of
value builds up in every business. So, family business inculcates the importance of business ethics in
an individual, rather than blindly going after money.
During the global meltdown, while other firms were downing shutters and handing out pink slips
indiscriminately to employees, family owned business managed to stay in the green and some even
managed to grow. The number stood at 65 percent in 2011 according to a survey done by the
multinational professional services known asPricewaterhouseCoopers (PwC), an increase from less
than half the previous year.
When it comes to support from the government, family offices feel left out. In spite of contributing
substantially to the economy, only firms in Turkey, Switzerland, Mexico, India, Malta and Singapore
generally agree that their governments value their sector. Elsewhere, like in Greece, 97 percent feel
their government does not do enough to provide the necessary support. Such sentiments are echoed
throughout the world stretching from South Africa to Italy to the United States.
As family businesses last longer, they gradually grow into large corporate behemoths. The largest
family owned business in the US is Wal-mart Inc. It has over $440 billion in net sales worldwide and
employing nearly 1.4 million people. In a survey of 222 mid-sized family offices, 70 percent of the
respondents had revenues in excess of 200 million dollars and nearly 25 percent had over 500 million
dollars.
Dominoes, for instance, is a family owned business that is constantly innovating and upgrading its
products. Now, it can be found in a number of countries around the world. Its success comes from its
unique way of carrying out a business, unlike others who do so within a rigid structure. Generally
speaking, family offices focus on direct investments rather than going for an Initial Public Offering.
They fixate on innovations, an incentive which has proven how co-investing, and prudent financing,
has been in their favor.
David Drake is the Chairman of LDJ Capital, a multi-family office; Victoria Partners,
a 300 family office network; LDJ Real Estate Group and Drake Hospitality Group;
and The Soho Loft Media Group with divisions Victoria Global Communications,Times
Impact Publications, and The Soho Loft Conferences. Reach him directly
at David@LDJCapital.com.