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Alternative Market Briefing

Family office VC investment and allocation on the rise

Wednesday, August 12, 2020

Laxman Pai, Opalesque Asia:

Over the last decade, family offices have been increasing allocations to venture and building in-house venture investment capabilities, primarily stemming from strong historical returns, said a study.

According to SVB and Campden Wealth report, on average, venture investments constitute 10% of participants' overall portfolios, divided between direct investments (54% of the average VC portfolio) and funds (46%).

Co-investing is a favored route to share infrastructure and expertise, with 92% of family offices co-investing alongside other families and venture funds. Co-investments make up 19% of the average family office venture portfolio, it said.

The report surveyed 110 representatives of ultra-high net worth (UHNW) families with experience in venture investing between October 2019 and February 2020. Additional Covid-19-related input was collected in Q2 2020. The responding single-family offices had an average of USD797 million assets under management (AUM) and the responding multi-family offices had an average of USD1.5 billion AUM.

John China, President of SVB Capital said: "Our research with Campden Wealth shows that family offices are seeing favorable returns in the asset class, and they are acting as strategic advisors and champions to the startups they invest in. We expect to see more family office investors in the venture ecosystem, collaborating and syndicating with like-minded investors and providing a differentiated pool......................

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