There are more than 230 family offices in Switzerland. They manage large private assets of wealthy families. Since family offices occasionally also finance charitable projects, they can be attractive contact points for charitable aid organizations. Fundraiso shows which family offices are active in the field of philanthropy and how fundraisers can obtain money.

The Italian Ferrero family ("Nutella") has one, as does the wealthy US Rockefeller family: a family office. Such family offices are not a modern invention. They have existed since the 6th century. According to the report "Family Offices - Looking Forward" by the former major bank Credit Suisse, at that time the so-called "court marshal" still managed the royal assets. Today, they are mostly professionally organized offices that take care of foundations, real estate, boats, airplanes, art collections, securities and much more of the super-rich. It is unclear how many family offices worldwide now manage and invest the assets of wealthy individuals independently of banks: in its report, Credit Suisse estimates that there are more than 7,300 family offices worldwide.

Different organizational forms: SFO, MFO and EFO

Experts distinguish such offices between a "single family office" (SFO), which consists of the assets of a single family, and so-called "multi-family offices" (MFO). They manage the assets of several families. MFOs usually provide bundled services to their clients and are operated as for-profit financial service providers. A so-called "embedded family office" (EFO) is usually an informal structure that exists within a family business. Unlike employees of a bank, the employees of a single family office are bound only by the instructions of the owning family and act only in their interests. Each family office is therefore as individual as the family it serves. According to the Credit Suisse "Single Family Office Survey 2021", an average of ten people work in a single family office. On average, they manage assets for six people.

Family offices usually offer more than "just" asset management

A family office differs from a traditional wealth management firm in that it usually offers services that go far beyond pure investment and administration. Family offices often also take care of the financial, tax and legal needs of wealthy families. In addition to financial planning and wealth management, family offices also provide wealth structuring services, asset protection, wealth transfer to succeeding generations and charitable design. Discretion is important to family offices and the super-rich families. If family offices appear publicly at all, it is most likely through their philanthropic efforts. The research for this article showed: there is a wall of silence in the world of wealth management for the super-rich. The dozen or so family offices in Switzerland that were contacted all refused to answer questions.

Two Swiss Family Offices with Sounding Names

Information on the number of family offices is at least provided by the fundraiso.ch database: there are more than 230 family offices in Switzerland. Well-known organizations in Switzerland include Sandoz Family Office SA in Pully (VD), founded in 2017, and Jacobs Holding AG in Zurich, founded in 1994 by entrepreneur Klaus J. Jacobs. The Sandoz Family Office is based at the same address as the "Fondation Philanthropique Famille Sandoz," which was founded in 2018. Both family offices are philanthropically active, according to information on their websites.

Family members often set the tone in family offices

Family offices often work directly or indirectly with the foundations of wealthy families. Occasionally, family members are also active in the "family office" and also bear responsibility. In a Credit Suisse survey, 39% of all single family offices surveyed in Europe said that members of the family make investment decisions. One such example is COFRA Holding AG in Zug. It is headquartered at the same address as several foundations owned by the ultra-rich Brenninkmeijer family ("C&A"). Family member Charlotte Brenninkmeijer is currently managing director of the "Anthos Family Office". Anthos, according to its own statements, "promotes the success of the owners and the flourishing of the Brenninkmeijer family community." The Swiss Auxilium Foundation in Zug, which was also founded by the family, has been supporting organizations committed to human dignity and social justice for more than 50 years. The former C&A Family Foundation now operates under the new name Laudes.

The world's largest family office: Walton Enterprises LLC

The family office with the largest assets under management in the world is "Walton Enterprises LLC", based in the USA, according to a top 100 list compiled by the US SWF institute. This family office manages the family assets of Walmart supermarket chain founders Sam and Helen Walton. The assets amount to over 224 billion US dollars. According to the SWF list, the family offices with the largest assets are based in the USA. In contrast, their absolute number is highest in the UK. Interesting to know: The family office Fedesa in Monaco manages the largest assets in Europe with 55 billion US dollars. Switzerland is considered the second most important location for family offices in Europe, behind the UK.

Favorite investment branch of family offices: Technology

According to the Credit Suisse report, the most popular industries in which single family offices invest their money are FinTech and BioTech companies (56%), IT (32%), real estate (27%) and healthcare (20%). Just 5% of all family offices surveyed invest in education. In addition to investments in promising sectors, however, philanthropy also plays a certain role. The COFRA Group, for example, is committed to "doing well by doing good. Like many other family offices, the holding company pursues a philanthropic mission. ATAG Family Office AG in Basel works for several families. The company advertises on its website that it also offers advisory services related to charitable giving. Unfortunately, ATAG AG did not answer any questions on the topic either.

Direct relationships take precedence

Fundraiser Andreas J. Cueni from Basel says about his experience with family offices: "I have already encountered some family offices with very different interests as the seat and administrator of grant-making foundations. For example, Cofra, Helvetic Trust and IHAG Holding AG of the Bührle family. The vast majority of family offices, however, never appear in philanthropy. The funding themes are set by the wealthy families. With the help of information collections and links, such as those provided by Fundraiso, it is possible to pick out focal points of interest." Good contacts with charitable family offices can undoubtedly be worth their weight in gold for fundraisers. But which approach is promising? When asked, an experienced fundraiser with relationships with family offices in Switzerland writes: "Contact with family offices is very personal. Most family offices don't want to be flooded with unqualified inquiries." He also declined to answer questions.

Philanthropy is becoming "increasingly important" in single family offices

"Müller Family Office AG" in St. Gallen also complained to Fundraiso that it "cannot provide any information." Nevertheless: Andreas Schiemenz, managing director of the non-profit German family office "Sinngeber gGmbH", answered Fundraiso's questions. Schiemenz wrote: "Especially in single family offices, the topic of philanthropy is becoming increasingly important. The inquiries, processing and support of donation requests for the families are carried out here."

Thorough preliminary research key to success

According to insider Schiemenz, in order to connect with family offices, it's important to "build stable personal relationships with members of a family office." Social networks such as LinkedIn and alumni associations could be considered as a starting point for initial contact. Before a concrete approach, solid research is indispensable, he says. It is important to clarify how the family office is organized and which person is approachable for philanthropy. In addition, it is important to check whether there are common contacts through which a person can be approached. It is also important to know how the family behind the family office has been involved in charitable activities to date.

Precise presentation of projects is key

Good to know: Family offices are not a suitable fundraising vehicle for all nonprofits, experts say. As a small, unknown organization, the chances of success are small. Project references are always helpful when approaching them. As a general rule, it is imperative to have meaningful documentation on the project. The contents, the impact, the costs, the project partners and the project period must be listed. It is also important to describe how the project will be continued after funding. An overview of previous projects with a weakness-strength evaluation can also be helpful, according to Andreas Schiemenz. Tobias Karow, founder of the foundation expert platform www.stiftungsmarktplatz.eu, adds, "Sloppily completed or incomplete project applications, where a lot of work is triggered at the family office even before the project application is reviewed, are likely to have little to no chance of success." Fundraisers would also have to be "in the family office league."

The magic words are discretion, friendliness and focus

According to Andreas Schiemenz, "discretion, friendliness and focus" are important when dealing with family offices. Schiemenz says, "Especially when dealing with financial officers, clarity, transparency and openness also play an important role. Unlike in traditional fundraising, data and facts count more than emotions." The high investment of time can be worthwhile, he says: "If you're successful with an application, you can look forward to a big chunk of money."

Tips for fundraisers dealing with family offices

If you're a fundraiser looking to approach family offices, here are some things to keep in mind:

• Find the right family office: Before approaching employees or leaders in a family office, find out in detail about the family and their interests and needs. Also clarify whether the family office supports charitable projects at all. Try to find out which issues and projects the family has supported in the past.
• Establish contacts: Discreetly and with restraint, try to establish personal contacts with family members of wealthy families or employees of their family offices. This can be accomplished, for example, at conferences, networking events, or by recommending mutual contacts. From the perspective of a non-profit organization, highly experienced, well-qualified and trustworthy fundraisers who can talk to members of a family office at eye level are particularly suitable for contacts with family offices.
• Clarify project suitability: Family offices usually support lighthouse projects with high funding needs and great charisma. Family offices are very selective when it comes to spending à fund perdu. They will only invest in projects that they consider promising and meaningful. The projects must be in line with the goals and interests of their clients.
• Compelling concept: develop a compelling concept and "business plan" that describes the potential of the project or initiative and highlights the benefits to the family. The concept must demonstrate planned impact, measurability, and non-profit status.
• Compelling project presentations: Make sure you can present all relevant information about your project or initiative clearly, convincingly, and within a short period of time, with lots of numbers.
• Build long-term relationships: Make sure you build long-term relationships with the selected family office by regularly informing the responsible persons about the progress of your project or initiative and also assist them with other concerns.

Author: Bernhard Bircher-Suits, FundCom AG