The author argues that after years spent building the wealth, there is no prize for rapidly rebuilding the portfolio.

The urge to put liquid wealth to work can be strong for business founders who often take great risks and put in tremendous amounts of time and effort into building up a company. The temptation to get moving fast, however, holds risks. The author of this article, Ron Honig (pictured below), explains what those advising people in this situation must think about. Honig is co-CEO of From-Honig Family Office, which is based in Haifa, Israel. (More on the author below.)

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Ron Honig

For most of their professional lives, founders are rewarded for acting. They make decisions with incomplete information, deploy capital, hire people, fire people, enter markets and move before everything is certain. Waiting too long can mean losing an opportunity.

A 2026 Morgan Stanley survey of 150 private-company founders gives some sense of that pressure. Some 84 per cent said they felt continual pressure to make the business succeed, and 54 per cent acknowledged spending too much time on short-term needs and not enough on long-term strategy.

Then comes a liquidity event. Suddenly, years of concentrated effort are converted into something very different, in the form of liquid personal wealth.

One of the things that has surprised me over the years is how uncomfortable that liquidity can make people who were perfectly comfortable taking enormous business risks. The problem is rarely a lack of investment opportunities. Quite often, it is the opposite. There are too many of them, and doing nothing can suddenly feel like a decision that needs to be defended.

Money is supposed to work, and opportunities begin to appear. A private fund is raising capital. A friend’s company is looking for investors. There is a real estate deal and the markets are moving. The pressure is not necessarily coming from advisors or markets. Often, it comes from within.

What should we do with the money?
For people who have spent years being rewarded for making things happen, the instinct is to start making decisions. But sometimes waiting is exactly what the capital needs.

The pressure to rebuild
A liquidity event may solve one concentration problem while quietly creating the conditions for another.

Before the transaction, much of the family's wealth may have been tied to a single company. Afterward, the proceeds suddenly become available for investment. It is tempting to think that the next step is diversification, but diversification is not achieved simply by buying many different things.

We often see founders begin building diversified portfolios relatively quickly, allocating across public equities, private equity, venture capital, real estate and direct investments. On paper, the result may look well diversified. But if many of those decisions are made at roughly the same point in the economic and market cycle, another form of concentration has been created.

Timing matters. That distinction becomes particularly important in private markets. Several commitments to different managers can still create exposure to a similar investment vintage.

I saw how quickly these conditions could change in 2021. Some of the founders and executives we worked with hesitated to pursue an exit or IPO as valuations continued to rise. Waiting for a higher valuation could seem entirely rational at the time. Then interest rates rose sharply and market conditions changed very quickly.

The same timing risk exists after an exit. A family may invest with several different managers and across different asset classes, but if much of that capital is deployed within a relatively short period, the investments can still share exposure to the same market environment. Private-equity activity reached historic highs in 2021, with elevated valuations and a rapid pace of investment. McKinsey found that by 2025, only 19 per cent of private equity acquisitions made in 2021 had been sold, compared with an historical average of 30 per cent by year four.

We cannot know which entry point or vintage will prove attractive in hindsight. Therefore, there is value in not forcing all major allocation decisions into the months following the liquidity event.

Cash has a role too
I have never liked looking at cash only through the lens of the return it is not earning. After a liquidity event, cash may be doing something very valuable: buying the family time.

It allows a family to make one decision today without having to make 10 others at the same time.

It creates room to observe how spending changes after the exit, whether another business is likely to be started, what opportunities genuinely matter and how much capital the family wants permanently protected from entrepreneurial risk. It also allows investment decisions to occur at different points in time, adding another dimension to risk management.

The capital does not have a job yet
Immediately after an exit, the money may be liquid before the family's objectives are properly framed.

A founder may not yet have decided on his next career move, if any. A family may still be adjusting to a completely different level of financial independence. Philanthropic ambitions may evolve. Children may become part of conversations they were never previously involved in. Even the amount required to support the family's lifestyle may turn out to be very different from what anyone initially assumed.

We saw this with one founder after a significant exit. As we worked through the family's priorities, it became clear that they wanted to buy a rural property within the next few years. This was not simply another investment opportunity. It was something the family wanted for itself, and it materially affected how much liquidity needed to be preserved and how much capital could comfortably be committed to longer-term investments.

The important point was that this priority only became clear through the planning process. Sometimes the role of the capital is not obvious immediately after a liquidity event. It emerges as the family begins to define what it wants the wealth to make possible.

That is why one of the mistakes in post-liquidity planning is to assume that because the capital is available, every part of it immediately needs a permanent investment assignment. Some decisions are easy to reverse, but others are not.

A public security can usually be sold tomorrow. A 10-year private fund commitment cannot. A direct investment in a friend's business carries a different kind of permanence. A large property acquisition may change the family's expenses and future cash requirements.

Time has more value when the decisions in front of you are difficult to undo.

The opportunity cost is visible. The value of patience is not.

Waiting is difficult. If markets rise while a family holds cash, the opportunity cost for this portion is easy to calculate. If an investment opportunity doubles after the founder passed on it, the missed return is even more visible. 

The benefit of the investment that was never made at the wrong time is much harder to see. So is the value of having liquidity when markets fall, when a genuinely exceptional opportunity appears or when the family simply changes its mind about what it wants to do.

We tend to measure investment decisions by the returns they produce. But after a liquidity event, optionality has value too. So does the ability to say no, or to change direction.

There is no prescribed waiting period
For some families, much of the long-term strategy may already have been designed before the transaction. For others, the exit itself may change their objectives in ways they could not fully anticipate.

The relevant question is not how long one should wait but whether the family has had enough time to separate decisions that need to be made now from decisions that only feel urgent.

Capital can be deployed gradually, and long-term allocations can be built in stages. Private-market commitments can span different vintages, while liquidity can remain a deliberate part of the overall strategy. 

The transition does not need to happen on a single date simply because the liquidity event did. 

Learning to value inaction
Founders are often exceptionally good at acting under uncertainty. This is the exact ability that helped create the wealth in the first place. But managing the wealth can require something different: being comfortable with uncertainty without immediately acting on it.

The liquidity creates choices that did not exist before. A good post-liquidity investment strategy should preserve those choices while the family decides which ones really matter. Sometimes that means accepting that not making an investment is also a decision.

Some capital may pursue growth. Some may enter private markets or fund another company. Some may remain liquid by design, providing both resilience and the ability to act when markets or circumstances create opportunities that could not have been anticipated.

There is no reason for all of these decisions to be made at once. A post-liquidity portfolio should be built gradually, allowing the family to understand each step, become comfortable with the risks it is taking and preserve flexibility for what cannot be planned.

After years spent building the wealth, there is no prize for rebuilding the portfolio quickly. What matters is building it thoughtfully, at a pace that allows the family to understand each decision and be comfortable with the choices it makes along the way.

Giving it that time is one of the most important investment decisions a family can make.

About the author
Ron Honig is co-CEO of From-Honig Family Office. He spent more than two decades working in finance and operations within technology companies and has spent nearly a decade advising founders, senior technology executives and affluent families on wealth strategy.

Disclosure: This article is for informational and educational purposes only and does not constitute investment, tax or legal advice.