It has been acknowledged that there are two basic types of family offices:
- a single-family office (SFO) – it supports only one family,
- a multi-family office (MFO) – it supports at least two families.
Single family office
A traditional single-family office is a business run by and for a single-family. The company’s assets/financial capital is the family’s own wealth, often accumulated over many family generations. Typically, these organizations employ staff to manage investments, taxes, philanthropic activities, trusts, and legal matters. The family office invests the family’s money, manages all of the family’s assets, and disburses payments to family members as required.
A multi-family office comes in all sizes, serving any number of families, ranging from only a couple to a hundred or more. Some offices only accept clients with a minimum amount of wealth and others serve all families able and willing to pay their fees.
Virtual family office
A virtual family office is a “lean” single family office which has 1-2, no more that 3 full time professionals running the family office with other services outsourced.