The Micro Family Office

NEWSLETTER

Family office insights this week:

• What if family offices aren’t just for the ultra-wealthy?

• Why family offices and wealth advisors need to adapt or die

• HNW asset allocations

• Books: dispatches from the ultra-rich

• Podcasts: the outsourced CIO

The Micro Family Office 

A thought experiment on how small is too small.

Today it’s a thought experiment: Can a micro family office work?

With low AUM, cold “family office” just be a vanity label, or does this topic reveal something deeper about how family office services are evolving?

Family offices exist to manage substantial family wealth responsibly and to support the long-term needs of multiple generations.

A full-service family office typically includes a dedicated team to manage investments, accounting, and administration, led by a family office CEO (often a lawyer, wealth planner, tax specialist or trust officer) who oversees operations and keeps the family informed.

That team will run investments, source deal opportunities, liaise with the banks and tax advisors, and process all annual returns. A team is often tasked with managing family affairs, properties, concierge services and education. The single family office is essentially a fully functioning company built solely to manage a family’s wealth and well-being.

The average family office surveyed in the recent UBS Global Family Office Report employs 12 people.

The average family surveyed by UBS held wealth of $2.7 billion and $1.1 billion AUM were managed by the family office.

At that level of wealth, the cost of a dedicated family office team can usually be fully justified.

What about smaller family offices? We recently shared a piece on the rise of the sub-$300M family office, where a virtual model and smart AI can democratize family office services.

But what if we went even further? A $20 million family office? 

Let’s call it the Micro Family Office. A small virtual family office managed by the founder.

$20 million is not insignificant, but it falls way below traditional thresholds for defining a family office. But could this size family office operate efficiently? 

Like any company in 2025, a family office doesn’t need to run from expensive premium office space, with a team of full-time employees on monthly payroll.

It could be registered anywhere in the world and run by outsourced fractional employees.

A wealthtech platform can support reporting, document management and legacy planning. And a handful of external specialists could handle accounting, estate, tax, legal and other requirements. 

Is this just a modern way to self-manage your wealth or could this be considered a super-lean micro family office?

And does it even make sense? 

Let’s say you had a liquidity event and you want more control over your financial destiny than private banks or a Multi-Family Office can offer. You feel a family office-like structure is right for you and you’re excited about spending time managing your wealth - being your own Family Office CEO. 

Outsourced specialists and fractional talent is available. And technology has made it easier than ever. Modern wealthtech platforms are designed to be powerful and intuitive and no longer require hard-core techies to operate. 

Let’s look at the annual costs of setting up a lean $20M family office. 

A rough cost outline quickly reveals that the viability of this approach largely depends on the rates and fees you’re able to negotiate with your service providers.

Operating Cost: The Micro Family Office

So yes, it’s theoretically possible to run a micro family office at a cost of just over 1% of AUM, if you’re doing most of the work yourself.

But that raises a key question: what happens if something goes wrong? A super-lean model relies heavily on one person and is highly vulnerable to key-man risk.

And that leads to a bigger question: why go through the effort of building a micro family office in the first place?

For some, it’s ego. Let’s be honest, having a “family office” has become a status symbol.

But there are alternatives. You could walk into UBS, Citi, or JPMorgan and access full-spectrum wealth management for as little as 0.35% in fees.

Or you might join a multi-family office that still gives you a strong voice in investment decisions, while handling everything from multi-generational structures in different jurisdictions to highly complex portfolios.

There are also digital-first platforms like Compound, which combine a wealth manager, tax advisor, estate planner, and tech platform into one streamlined solution - essentially a digital MFO.

As technology advances, the range of models is expanding. Wealthy individuals now have more choice than ever.

In the end, it often comes down to one simple question: what matters more to you: time or money?

What is this, a family office for ants?

The family office marketplace is murky enough without a thousands more declaring themselves to be family offices, micro or not.

The hype around family offices is intense and growing and maybe micro family offices would be a way for the newly wealthy to feel like they’ve “made it.”

But this thought experiment isn’t really about encouraging people to call themselves a family office. It’s more about highlighting the trend to make once-exclusive services accessible to a much wider audience.

It’s easy to scoff. But here’s the truth:
 
Tech is getting better
Talent is more flexible
And younger wealth creators are often more hands-on than their predecessors.

Does a $20M setup need to be called a family office? Probably not.

But if the structure works, the costs are contained, and the wealth is preserved, who really cares what it’s called?

𝕏 highlights

We’ve shared a lot around family office asset allocation. Here’s some data on HNW asset allocation.

Change is coming… and family offices and wealth advisors need to adapt or die.

And a look at asset classes favored by SFOs.

 💼 where to work

Three notable family office job opportunities this week…

Director, Family Office - Citi Wealth (San Francisco / Service Provider)

Head of Single Family Office - Private Family Office (London, UK / SFO)

Executive Assistant - Private Family Office (New York / SFO)

📚 what to read

This week I read The Haves and the Have-Yachts by Evan Osnos. It’s an interesting look at modern plutocracy. It describes how the ultra-wealthy live, think, and insulate themselves from the rest of society. For me, the most interesting chapters examine the toys and behavior of the ultrarich... the yachts, the bolt holes, the private gigs from global superstars. The political commentary that follows felt less fresh, probably just because it’s a track that’s been well-trodden.

📻 what to listen to

Staying with the theme of oursourced services, this episode of Family Business Stories from PWC is a highly insightful exploration the growing popularity and topics around outsourced CIOs.

📺 what to watch

I’ve been excited for a long time about the movie Mountainhead, written and directed by Jesse Armstrong (of Succession fame) and a stellar cast led by Steve Carell. The premise is irresistible: a group of billionaire tech bros holed up in a Utah ski lodge as the world unravels around them.

The critics seemed to love it. The audience (including me) were not so impressed. Technically, this could go down as our first what-not-to-watch recommendation.

And finally…

The topic of smaller family offices is an intriguing one. A couple of weeks ago, I tweeted the question, $50M AUM, what are you choosing?

This question divided opinion! So much so that we’ll take this fight into a newsletter soon!

Family Office Buzz on Monday included a look at Asia’s most extravagant royal, a review of the TV show Your Friends & Neighbors, why young investors are replacing wealth advisors and the hottest new luxury: dog rooms.

On that note, here’s to an outstanding weekend.

Woof woof!

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