Asian family offices are the fastest-growing segment of all family offices across different continents. They are starting to establish proper structures and are hiring top-quality talent.
In fact, according to an article in The Business Times, 85 percent of Asia’s billionaires are first-generation, fueling the boom in family offices. The article also reports that the average Asia-based family office was managing $492 mn in 2016.
So how does a corporate access a family office in Asia? The key is consistency. Rome wasn’t built in a day and neither are key relationships. Many of the corporates I deal with in Australia and Europe come to Asia perhaps once or twice a year, with the expectation that the family offices will start to put money into their stock. What many corporates don’t realize, however, is that the Asian family office wants to get to know the management of the company at a high level – much like the big institutions.
It is, therefore, key to have constant, strong communication, not just in your home country, but also in foreign markets – wherever you are trying to access capital. Some key points to keep in mind when targeting Asian family offices:
- Build long-term relationships. Don’t just come to Asia once and expect family offices to invest with you. Make a consistent effort by coming out every quarter, or at least keep the relationship going between visits if you can’t physically make it to the region
- Be clear about what you are looking for. Many corporates go on the road without being clear what their goals are. Are you looking to diversify your shareholder register, find strategic investors, or improve coverage, for example?
- If you have broker coverage, bring it along. Most family offices rely very much on private bank research but coverage is mainly on large caps, so family offices don’t get much value-add from it
- Finally, bring them something they haven’t seen before. The reality is that many Asian family offices are still heavily invested in real estate and hard assets, but are looking for value if you can show it to them.
Something else to bear in mind: family offices in Asia often have small teams of investment professionals, with maybe only two or three staff, and the research they consume comes mainly from private banks. But they do enjoy coming to specialized roadshows where they discover new companies.
All this can remain tricky without the help of someone with local knowledge, however. I highly encourage corporates to tie up with strategic investor relations firms in the region to help them get a foot in the door. You simply can’t ignore the region with the fastest-growing wealth in the world.
Omar Taheri is founder of corporate access firm Spark Plus
