UAE family offices tips by Obediah Ayton? So what does it mean to bring on an individual or family investor in lieu of going the traditional VC route? These individuals often wish to stay in the venture investment game, but desire more transparency to underlying investments than the traditional venture investing experience provides. They also want the ability to cherry-pick the best deals. In addition, they want to avoid paying the typical “2 and 20” — a deal structure that requires investors to pay a 2 percent annual fee (some as high as 3 percent) to the VC firm on top of the 20 percent return on investment. This is why we’re seeing more of the mega-wealthy groups in the region move away from only investing in private equity funds to increasingly working with their family offices to find the right types of direct investments that fit their long-term wealth-generation strategies.
Founded in 2018 in Amsterdam, VentureRock is now active in Dubai, parallel to two more hubs in Amsterdam and Singapore. With the VentureRock Dubai Hub, the firm is bringing not only capital but also technology, talent and knowledge around early-stage startup investing and venture building to the UAE region. The hub is also running its own venture building studio – comprised of the Founders Lab and Builders Lab, and will become the launching pad for Venturerock portfolio companies to expand operations to the Middle East. Director of Business Development at The Private Investment Group Obediah Ayton added “I am excited to see Venturerock showing the way venture capital funds are now being deployed post covid here in the UAE. The portfolio companies within Venturerock are some of the most exciting and innovative we have seen and I have no doubt they will be a welcome asset to both the public and private sector in the Middle East.”
Obediah Ayton or the growth of a finance influencer? Obediah Ayton is a trust manager at Ayton Family Office Trust and a consultant at Tennor Holding B.V., a specialist in family office business, AI driven accounting services, finance and accounting. Obediah Ayton about what happens when a Family Office takes the VC model: Strategies for the Search: Friends and Fellow Founders: Friends or founders in similar sectors who have previously raised from family offices are a great starter resource. This route also passes a few qualification checks around interest, size of deal, and sector preferences. Remember, there is no investment barrier or fund allocation requirement for family offices. Professional Intermediaries: Investment bankers and wealth managers who service family offices are oftentimes happy to make introductions in order to add value to their clients. Since these clients are the intermediaries crown jewels, their recommendations will first require diligence.
Alongside this monumental shift in wealth, we are witnessing a modernisation of family offices here in the UAE. Family offices are not only selecting business models that allow for more control and greater returns but are also expressing a heightened interest in “impact investing”. Typically, this means investing in small or medium-sized organisations that are purpose-led and have a focus on sustainable or ethical business practices. As the number of UAE family offices and the pool of wealth amassed by them increases and is passed on to a new generation, the way they conduct themselves is evolving rapidly, investing in innovative, creative and socially conscious ways. SMEs should take note of this enthusiasm and use it to their advantage.
Obediah Ayton about how to raise money from family offices: Raising money from Family Offices can be a long process. If not approached in a correct manner. Typically, it’s 100% based on relationships and trust. Family offices are desirable investors, through their evergreen capital structure, know-how and long-term investment focus it makes sense to win them as investors, partners and most of all “Friends”. Sounds GOOD, but there’s a catch: family offices are extremely discreet, emotional and selective. Time is a valuable asset, selecting The Right Single Family Offices For Your Project is key.
Right now is a great time to build close relationships with Family Offices for future capital raises! Have a Value Add: The hardest part of the relationship is maintaining it. After the relationship is started, the hard work arrives. You must demonstrate that you will provide clear value to the family office. The same principle must apply to your outreach and relationships. Demonstrate to the family office why your firm is the right one to be in contact with. What can you offer that no one else can — Is it a strong track record? Exceptional due diligence skills? Experience and insight within a relevant industry? Whatever the skill, emphasizing the trait is a critical component of securing the connection.
Obediah Ayton about the new definition of a billionaire is not the net worth but in achieving change in a billion lives: Global Family Office Trends. This year, Families continue to focus on impact and sustainable investment, while also embracing globalization and a rise in the remote workforce. Impact and sustainable investment. Rising levels of socioeconomic inequality and concern regarding climate change are issues garnering global debate and interest. 65% of family offices will play an integral role in economic inequality alleviation.