Middle East Family Office
💸 Single Family Office (SFO) based in the Middle East invests based on values & character.
The insights below come from a conversation with the Principal of a SFO based in the Middle East who made their wealth in commodities. They have a unique philosophy of investing based on alignment of values & character. The family has strong entrepreneurial roots and have been building out their venture portfolio over the past 5 years (mix of fund of funds and emerging managers).
🧠 Investment Philosophy
Purpose-driven: Seek to make a positive social and/or environmental impact through all investments.
Values & character alignment: Integrity, humility, transparency, collaboration, self-awareness (question themselves, admit & learn from mistakes, etc.).
📊 Portfolio Construction
Some liquid investments with significant illiquid exposure (real estate, venture, private equity).
🚀 Venture Portfolio
2-5 fund of funds (to get access to established funds).
10-15 funds, primarily emerging managers.
10-15 directs / co-investments.
Across SE Asia, Europe, and US.
🔮 Looking Forward
Consolidating positions and focusing on 8-10 managers who are more experienced.
Looking to diversify portfolio by building up a robust PE program and uncorrelated asset classes, e.g. litigation finance.
Staying away from hedge funds (invest in what you understand).
Waiting for distributions to get additional liquidity.
✍ Lessons Learned
Character and values matter as much (if not more) than past performance.
Emerging managers, a mixed bag: Doubled-down on emerging managers thinking they (the SFO) will form deeper relationships, learn, get access to co-investments, and have higher potential for outsized returns. While that was partially true, a recommended criteria LPs should consider is if the GPs have been through multiple market cycles and how they behaved, i.e., did they show restraint / have strong conviction vs. peers.
🎷 Connect and Collaborate
LPs: Which PE funds would you recommend to this SFO as they build out their portfolio?
Family Offices & LPs: connect with a curated group of global LPs exchanging insights (pls. DM).