Family Office

How Family Offices Can Overcome Tech Adoption Shyness

Tom Burroughes Group Editor February 29, 2024

How Family Offices Can Overcome Tech Adoption Shyness

Expanded significantly from its Oakbrook Solutions acquisition last year, we talk to one of the figures involved in F2's work with family offices, law firms and ultra-HNW clients about areas such as technology.

Most family offices, ultra-high net worth individuals and law firms are more sophisticated and educated about the kind of technology they need to use than was the case 20 years ago, but a “significant” minority haven’t reached this stage, according to F2 Strategy, the US-based consultancy. 

“It’s challenging no doubt, and I tell them that it’s easy to be distracted and overwhelmed by all the shiny new toys and the incredible pace of change. I remind them that not every technology is relevant to their business and not every service provider is right for their business,” Mike Perez, managing director, told this news service in a call. Perez joined F2 last year when the firm bought  Oakbrook Solutions, another tech consultancy. F2 also secured a majority investment from private equity firm Renovus Capital.

“My family office clients that have benefited the most from embracing technology are typically those with proactive planning and a clear understanding of the necessary capabilities and how technology aligns with their broader business strategy. While this may require initial investment, it minimizes surprises and unexpected costs in the future,” he said. 

The comments on the technology requirements and preparedness of family offices will be familiar to FWR readers. For example, the ability to find – and keep – talented executives is a recurring theme for the industry. Another trend chronicled in these pages is the rising use of outsourced services by family offices. This news service has also cast its eye over the ways family offices can make smarter choices in selecting tech vendors – a regular topic for our annual fintech summit in New York. (See last year's agenda as an example of the topics.)

The family offices sector in the US is the world’s largest, giving F2 plenty to do. According to Campden Wealth, there were about 6,000 to 7,300 FOs in 2019. There isn’t an exact figure. In 2022, Highworth Research, with which this news service is exclusive media partner, launched a North American database to explore the sector. (To register for access and a trial, see here.)

Perez supports using case studies to illustrate why clients should consider change. 

“Sure, first they provide a real-world practical example and validation of how a specific product, service or strategy has been implemented in a live production environment. Second, use cases show how to solve problems or challenges that other prospects or clients may have and can be very inspirational. Finally, it can be both a learning and decision-making opportunity serving as educational tools for clients, peers, third parties, and prospects,” Perez continued, 

“My approach is straightforward yet strategic in nature and consists of an operating model assessment netting recommendations and a future state directional roadmap. The recommendations can be compliance related, operational efficiencies, and technology based,” he said. “For new tech, I focus on several key areas to illustrate the value of spending here. Namely, alignment with my client’s strategic business objective(s); data quality and transparency; operational efficiency; reporting (all); and risk mitigation. In addition, I help my clients understand that the costs and complexities of implementing the latest bespoke family office applications are no longer the roadblocks that they were 20 years ago.”

There’s a lot to do. F2 deals mainly with US family offices but abroad, it also has several Canadian clients.

Last year’s arrival of Oakbrook into the F2 business has quadrupled F2’s workforce and added capabilities in the family office, bank, trust, and law firm space. 

Acquiring those resources and intellectual firepower is necessary because F2 will need to keep abreast of big trends, such as the general advance of family office tech, rising investment in private equity – and the tech support and administrative capabilities that involves, cybersecurity threats, and their remediation, and last but not least, AI.

Perez is part of a growing business, and he has the experience he'll need, having worked at Rockefeller Trust Co, JP Morgan, and Grant Thornton. 

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