Hi Guys,
So I've been doing a bit of reading into family offices recently and have seen various people working at large shops (AUM $3bn+, which is large for an FO) and describing them as private equity. Is this the case?
My perception was that for a business to be considered private equity it required outside investment. Would be good to hear the thoughts of this from those on the PE forum.
Thanks all!
You don't need outside investment.
FOs make PE investments (alongside x# of other forms given its private capital), but would be wrong to classify them as PE given its a bit of a blanket statement. FOs are FOs with extremely flexible mandates that invest across the spectrum.
Family offices run a lot of different strategies (basically whatever the family wants). Some of those strategies are essentially the same as their non-FO PE firm counterparts, but some are not. For example, Pritzker Group is basically a PE firm with a much longer term time horizon since they don't have to return capital. There will also be plenty of other FO's that don't touch PE at all (at least not directly) - they just allocate to various funds and then monitor how those funds do.
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