What is a family office — and which model fits yours?

The term "family office" covers a wide range of structures with very different purposes. Understanding the main models is the starting point. Knowing which one is right for your family requires a different kind of thinking.

A structure, not a product

A family office is a private organisation built to manage the wealth, affairs, and legacy of one or more wealthy families. It is not a product sold by a bank. It is not a wealth management mandate. It is a structure the family owns, governs, and defines — and whose mandate it sets.

That mandate varies enormously. Some family offices focus almost entirely on investment management. Others are comprehensive platforms that handle tax, legal, succession, philanthropy, next-generation education, and the day-to-day affairs of the family. The IMD Global Family Office Report identifies no fewer than nine distinct identities — from the "strategy council" to the "onboarding club" — that family offices can embody simultaneously or at different stages of their evolution. Behind each of those identities is a family that made a series of deliberate choices about what it wanted its office to do.

The phrase that captures this best comes from the practitioners who work in the field: when you've seen one family office, you've seen one family office. That is not a warning against generalisation. It is a reminder that the structure must serve the family — not the other way around.

The single family office

A single family office (SFO) is dedicated to one family and one family only. The family owns it, staffs it, governs it, and funds its operating costs in their entirety. Nothing about the SFO is shared with another client. The team it employs knows the family's affairs with the depth that only comes from working exclusively for them.

This exclusivity comes at a cost. Running a fully-staffed SFO — with investment, legal, tax, compliance, and administrative functions in-house — is expensive. The commonly cited threshold below which an SFO ceases to be economically rational is around €150–200 million in assets under management, though in practice the picture is more nuanced. A family with €300 million concentrated in a single asset may have simpler needs than a family with €500 million distributed across multiple jurisdictions, operating companies, and asset classes. Cost is a constraint; it is not the only variable.

The SFO's advantages are real: total control over investment decisions and strategy, absolute confidentiality, a team that serves the family and no one else, and the capacity to build an institutional culture that can survive a generational transition. According to IMD's global survey, over 70% of family offices are single family offices — the dominant model in practice, not merely in theory.

The SFO is also the most demanding structure to govern. It requires the family to be an active and capable employer, to set and maintain a clear mandate, and to make difficult decisions about talent, compensation, and performance. Families that outsource their thinking about how to govern their office to the team it employs have already made a structural error.

The multi-family office

A multi-family office (MFO) serves multiple unrelated families from a shared platform. There are two distinct variants, and the difference matters.

A commercial MFO is a business whose clients are wealthy families. It is built to make a profit; its incentives are those of a service provider. Many banks, asset managers, and private wealth advisors operate under the MFO label — and the interests of the platform do not always align perfectly with the interests of any individual family it serves.

A family-owned MFO is a different proposition. It typically begins as a single family office that, at some point, decides to open its structure to other families — either to spread fixed costs, to bring in additional expertise, or because the founding family sees an opportunity to build something larger. The IMD survey distinguishes between "open" and "closed" versions of this model: a closed family-owned MFO serves only families invited by the founding family; an open one is accessible more broadly. In both cases, the platform retains more of the SFO's character than a commercial MFO does — but the founding family now has governance obligations to other clients, which changes the dynamic considerably.

For the families that join an MFO as clients rather than founders, the logic is straightforward: access to investment opportunities, operational infrastructure, and talent that would cost more to replicate independently. The trade-offs — diluted attention, shared infrastructure, dependence on a provider whose interests are not identical to yours — are real and should be assessed with clear eyes.

The hybrid family office

The hybrid family office is a model that has gained visibility in recent years, and the IMD report identifies it as one of the most interesting emerging patterns. In its most common form, it begins as an SFO that opens selectively to a small number of other families — usually founders known personally to the principal family, with aligned values and compatible investment philosophies.

The logic is pragmatic. The founding family's fixed costs — investment team, technology, legal and compliance infrastructure — become partly recoverable as the office serves additional clients. The new clients benefit from a platform that has already been built and tested by a family that runs it for itself first. The relationship has a different quality from the commercial MFO: it is built on trust between families, not between a family and a service provider.

The risks are equally distinct. Governance becomes more complex when two or more families share a platform. Investment decisions that serve one family may not serve another. The founding family must decide how much authority to retain, how to handle conflicts, and how to protect their own affairs from the friction that inevitably comes with serving others. Hybrid offices work well when the families involved are genuinely compatible and the governance framework is designed with those tensions in mind. They fail when they are built for cost reasons alone, with insufficient thought given to what happens when interests diverge.

The outsourced single family office

The outsourced single family office (OSFO) is a structure in which the family retains strategic control of its affairs but delegates their execution to an external provider. The family defines the mandate, sets priorities, and makes the decisions that matter. An external team — employed not by the family but by the provider — handles day-to-day operations: reporting, administration, compliance, investment execution.

The OSFO has become a dominant narrative in the industry, promoted energetically by the providers who offer it. That is worth noting. It is also a genuinely appropriate model for some families — specifically those who want the benefits of a dedicated structure without the obligations of being an employer and running an organisation. Families that have recently experienced a liquidity event, that are in the process of deciding what their family office should look like over the long term, or that simply do not want to manage a team often find the OSFO a sensible interim or permanent arrangement.

The risk is well-defined: delegation without oversight produces distance. A family that outsources the running of its office and then disengages from the detail of what the provider does on its behalf has not built a family office. It has hired a wealth manager under a different name. The OSFO works when the family remains an active and informed client. It fails when the family treats it as a reason not to engage.

The conventional answer is not the right one

The standard industry answer to the question "which model should we choose?" is structured around assets under management. Below €150 million, the argument runs, an SFO is too expensive to justify; above €500 million, it becomes the obvious choice. Between those thresholds, the MFO or OSFO offer better value.

This is not wrong as a first approximation. It is incomplete as a framework for decision-making.

We have worked with families holding substantial assets who were better served by an OSFO because they had no interest in managing an organisation, no desire to employ a team, and a clear view that their family office should be a light and flexible tool — not an institution. We have also worked with families holding more modest assets who needed a full SFO because they had a complex operating business, a multi-jurisdictional asset base, and a strong intention to transmit an ownership culture to the next generation. The asset threshold told them nothing useful.

The right questions are different ones. What do you want your family office to do — in ten years as much as today? How do you want to relate to it — as an active governor or a strategic client? What role do you expect it to play in your family's internal life: purely financial, or also the space where the family engages with its shared wealth, its values, and its future? And critically: how do you expect your needs to evolve? A structure that is right for a first-generation founder managing a single large asset is not automatically right for a third-generation family managing diversified investments across four jurisdictions.

These questions do not have universal answers. They have answers that are specific to your family — and those answers change over time.

Where Westwick fits

Westwick was not built to tell families which model to choose. It was built to help them think through the question correctly — and then to sit alongside them as they act on the answer.

Our partners have worked inside single family offices, not just alongside them. We have governed transitions between models: from an SFO that was no longer fit for purpose to a hybrid structure; from an OSFO that had become a delegation too far to a rebuilt in-house office. We have seen what happens when the model chosen at inception no longer fits the family it was built for — and we know that the cost of rebuilding is always higher than the cost of choosing carefully at the outset.

That experience is what we bring to the families we work with. Not a framework. Not a product. A capacity to ask the right questions — and stay in the room until the answers translate into something that works.

If you are deciding what your family office should look like, or questioning whether the structure you have today still serves you well, we are happy to have that conversation. Get in touch.

If you have already decided on a single family office and are thinking about how to build one, the next guide covers exactly that: How to set up a single family office.