However, even some families who can justify setting up an SFO will consider a multi-family office platform to consolidate and cut costs, also prove their worth if it is essential for internal affairs or disputes to be kept within the family and away from the public eye.”

However, one of the reasons why SFOs are so expensive is because the family has to acquire all of the components themselves – including staff, premises, technology and software – and then adapt each of them to reflect changing circumstances.

Similarly, SFOs can be “disbanded” - as Agreus puts it – and altered at any time, which could result in recruitment difficulties. Click here to download the paper.

Multi-family office

One of the main points covered by the report on the MFO front is that, by opting for this model, a family looking for a more customized service can still receive it at perhaps a fraction of the cost because the infrastructure, staff and technology are already in place and shared between several other families. This, Agreus' paper said, is probably one of its biggest benefits.

Other instances in which an MFO model might be more suitable include when: the family has significant wealth but might not be able to sustain their own set-up; they require specific expertise relating to a particular asset class or type; their wealth isn’t particularly “active;” and if they are more time-restricted.

Additionally, MFOs can bring “unparalleled expertise” as staff have to meet the unique and often complex needs of several families, instead of only catering to one. Indeed, it’s therefore a route that may require the family to relinquish some control over their wealth – but this may also prevent family disputes.

“Arguably, the largest challenges facing multi-family offices are managerial, but this can be avoided with clear and regular communication with your main point of contact,” Agreus said, adding however that they are “a lot more stable” because they are a separate company. “They carry on even when families come and go.”

Conclusion

In its report Agreus noted that each family office is unique, indeed because every family is unique, and therefore "there can never be a specific cost or guideline structure when looking to set one up."

But above all – in the words of Carroll - “family office clients will pay a premium for quality.”

And, although there are notable differences between the SFO and MFO model, “experienced advisors can minimize them,” he said. “Professionals serve family office clients best in both models by focusing on three attributes of service that are most important to people who already have everything by emphasizing the quality, control and security of their specific offering to the client.”

Meanwhile, Carroll added that, because family office clients want “absolute control” over their affairs, the most successful advisors will be those who can provide “top-tier, easily accessible reporting.” Specifically, those with the ability to provide reporting based on independent market sources – combined with reconciled data – have a “huge knowledge, communication and information advantage.”

Perhaps most crucially, though, family office clients want security and they highly value the “sleep at night” factor. Advisors can achieve this by employing regular third-party validation of success measures to reassure clients, Carroll said.