Empaxis was born out of a multibillion-dollar multifamily office and has a deep understanding of the unique reporting requirements and market challenges your business faces.
We also understand that your firm’s continued commitment to growing client wealth from one generation to the next requires a more sophisticated investment approach that can often put stress on your back-office resources.
What challenges face family offices?
It’s one thing for the high- and ultra-high-net worth to know what they want out of the family office, but it’s a lot harder implementing the steps to achieve the goals, especially if they lack experience in the investment management industry.
Without experience, doing things on one’s own can prove costly and inefficient. “Experimenting” with new hires, attempting to implement new technology or running the portfolio accounting software on one’s own, and even hiring family members to handle work beyond their capabilities are all ways that things can go wrong for FOs.
Family offices in Asia might have no choice but to pay a premium for investment adviser talent, but they can access operational talent and cut costs by outsourcing their middle- and back-office functions.
There are outsourcing companies that specialize in serving family offices, and they can run the FOs reconciliation and other reporting requirements at lower costs than if they were to be done in-house.
With operations outsourcing, family offices are paying strictly for labor costs; they’re not having to pay for benefits, perks, sick-leave or vacation days associated with in-house hires.
As mentioned earlier, the growth of family offices and subsequent talent shortages in Asia will create competition for hiring, a costly affair.
Outsourcing provides family offices a low-cost way to have experts who understand portfolio accounting and the software to run the reports. These firms should have mature processes in place for report generation, data accuracy, quality controls, and protecting personal information.
For a family office to try and set everything up on their own can be ineffective and a waste of resources; outsourcing firms may help prevent those situations.
With outsourcing, family offices are strictly paying for labor, and they pay for the labor as they need it.
Outsourcing makes it easier for FOs to ramp up or down their operations. When things get busier or slower, the outsourcing provider adjusts staffing needs accordingly, as they already have the trained backups to perform the work and can be used and set aside at any time.
In contrast, in-house hiring can be tricky because family offices must deal with “flood” and “drought” periods. Floods occur when the workload exceeds staff capacity, and droughts occur when there’s not enough to work go around, and in those cases, underutilized staff is kept around until the next rainy season.
Granted, it’s hard to predict how much in-house labor is needed, but employee idle time can be a waste of resources, and outsourcing may help solve this issue.
Outsourcing your family office can help you in other ways too, including less operational complexity, access to the latest technology, more time to focus on core competencies and increased reporting quality.
At Empaxis, we help you diversify your family office strategies and foster wealth for your clients by offering a fully customizable and highly cost-effective back-office accounting and reporting service.
By working with the highly talented Empaxis team of back-office accounting and support professionals, you can be assured that your back-office processes have been streamlined to offer agility, scalability and cost efficiency for your family office outsourcing needs. We can help whether you’re running single-family offices or multifamily offices.