Ryan Loehr
10 December, 225
During a recent research trip to the United States, I spent time with the team at Rockefeller Capital Management in Newport Beach, California. What began as a discussion about their multi-family office model evolved into a masterclass on servicing ultra-high-net-worth families across generations.
For Australian family businesses and founders contemplating their wealth management structure, the insights from the organisation that invented the family office model in 1882 offer invaluable perspective on the journey from entrepreneurial wealth creation to multi-generational stewardship.
From Single Family to Multi-Family: A 140-Year Evolution
The Rockefeller family office was established in 1882 to manage the affairs of one extraordinarily wealthy family. For nearly a century, that’s exactly what it did – handling tax and estate planning, investment management, philanthropy, and lifestyle services exclusively for the Rockefellers.
By the 1980s, the family had expanded to multiple generations and hundreds of members. The infrastructure required to service them began to resemble a multi-family office anyway. The logical question emerged: if we’ve built this capability, why not extend it to other families?
Today, Rockefeller Capital Management oversees $187 billion in assets under advisement across 53 offices. Yet despite this scale, the firm maintains an interesting philosophy: no account minimums and no fee minimums.
The Critical Question: When Do You Actually Need a Family Office?
This brings us to perhaps the most important insight from our discussions – one that resonates deeply with conversations I have regularly with Australian families post-liquidity event.
“I think $100 million is really where that family office kind of fits in to have their own structure,” one of the Rockefeller advisors noted. “It can go as low as $50 million, but it depends on the complexity of the family. About that $30–50 million is kind of that sweet spot where it’s underserved. They’re not big enough to really have their own infrastructure.”
But here’s where it gets interesting. Even families with $800 million to $1 billion – traditionally considered the threshold for a standalone single family office – are increasingly questioning whether the infrastructure investment makes sense.
“Even now with billion-dollar families, they’re kind of coming full circle back to that multi-family office in a traditional sense of saying, ‘Hey, I want to pool resources with three other families, four other families. We’re not going to have a sign on the door, we’re not going to be publicly marketing, but we want to defray costs.’”
The trend is clear: the allure of having your own branded family office is giving way to more pragmatic considerations around cost-efficiency, access to expertise, and reduced operational complexity.
Meeting Families Where They Are
One of the most refreshing aspects of the Rockefeller approach is their flexibility in engagement. Unlike traditional wealth management firms that operate on an all-or-nothing basis, Rockefeller has embraced a surgical approach to adding value.
Consider this example: they work with a $6 billion single family office in Los Angeles that has its own in-house Chief Investment Officer and direct access to any hedge fund or private equity opportunity they desire. The family doesn’t need investment management advice – they can access better pricing going direct.
So where does Rockefeller add value? “They said, ‘Well, we have to hire two staff to run net after-tax IRR on our 220 K-1s. We don’t want to do that. Will you do that for us?’”
The answer was yes, and the engagement was structured around that specific pain point, with flexible compensation options including flat consulting fees or access to co-investment opportunities.
This surgical approach recognizes a fundamental truth: sophisticated families don’t want someone to “take over.” They want strategic partners who can fill specific gaps in their infrastructure while respecting the family’s existing capabilities and governance.
The Reporting Challenge: No Perfect Solution Exists
Financial reporting remains the biggest pain point for family offices globally. Despite the proliferation of technology solutions, there’s still no turnkey platform that seamlessly handles complexity.
Rockefeller primarily uses Addepar, widely considered the best available solution, but acknowledged that “it takes a full staff to run the aggregations and the reporting.” Many single family offices that adopt Addepar “become quickly discouraged by how much work it takes to keep it up.”
The reality? Much sophisticated reporting still happens in Excel, with tax calculations requiring dedicated accounting resources. This is precisely why many families question building internal infrastructure when partnerships with multi-family offices can provide these capabilities without the hiring and retention challenges.
Beyond Investment Management: The Expanding Universe of Family Office Services
What struck me most during our conversations was how far beyond traditional investment management the modern family office has evolved. Rockefeller’s service offering now includes:
Next Generation Education: A comprehensive 12-month curriculum originally developed for the Rockefeller family’s seventh generation, now available to client families. This isn’t casual financial literacy – it’s a formal program covering everything from estate planning to taxation to investment strategy, delivered through monthly webinars, in-person sessions, and video content.
Family Governance Consulting: Through partnerships with firms like Generation Six, Rockefeller helps families navigate the complex interpersonal dynamics that often accompany significant wealth. This includes facilitating difficult conversations between generations, establishing family governance structures, and even addressing challenges like prominent children or interfamily conflicts.
Lifestyle Services: Private aviation consulting, art advisory, longevity and healthcare planning, and private security. These ancillary services, once considered peripheral, have become major client acquisition channels. “Three large clients have been referred in just for aviation, and then we ended up getting their asset management business,” one advisor noted.
The lesson? Comprehensive family office services aren’t just about investment returns – they’re about solving the full spectrum of challenges that accompany significant wealth.
The Next Generation Challenge: Starting Early or Never
Getting patriarchs and matriarchs to engage the next generation remains one of the most difficult aspects of family wealth planning. Our Australian experience mirrors what Rockefeller sees in the United States.
“If they’re not ready today, they’ll never be ready,” one advisor remarked. “We’ve found patriarchs in their 50s or 60s who want to get their kids involved as soon as possible, but if they’re 70 and 80 and still holding on to the reins, they’re probably never going to get comfortable with it.”
For families who have resisted these conversations, Rockefeller’s approach is to start small. One effective strategy involved creating donor-advised funds for adult children, allowing them to engage with wealth stewardship through philanthropy before tackling the broader family balance sheet.
The key insight: don’t let perfect be the enemy of progress. Some engagement with the next generation is infinitely better than waiting for the “right time” that may never come.
The Alternative Investment Advantage
One area where Rockefeller demonstrates clear differentiation is alternative investment access. While acknowledging that tax-loss harvesting and direct indexing are now “table stakes,” the firm’s access to opportunities through the Rockefeller family’s investment network creates genuine advantages.
Recent examples include co-investment vehicles featuring SpaceX and Neuralink – opportunities that simply aren’t available through traditional platforms. “It’s quite literally through the Rockefeller family and investments they’ve made,” an advisor explained.
This highlights an important consideration for Australian families: access matters. The network effects of working with institutions that serve other ultra-high-net-worth families can create tangible value beyond portfolio construction.
Implications for Australian Family Businesses
What can Australian founders and family business owners take from the Rockefeller model?
Resist the ego-driven urge. Don’t establish a standalone family office unless you truly have the scale and complexity to justify it. The $100 million threshold represents a minimum, not a recommendation. Even families with substantially more are increasingly opting for strategic partnerships.
Think surgically about your needs. Rather than seeking a provider to “do everything,” identify your specific pain points. Tax planning? Financial reporting? Next generation education? Alternative investment access? The right partner should address your priorities without forcing a one-size-fits-all model.
Start the next generation conversation today. Whether your children are in their 20s or their 50s, waiting rarely improves outcomes. Find small entry points through philanthropy or targeted education. Recognize that imperfect action beats perfect inaction.
Embrace flexibility. Even America’s most iconic family office continues to evolve its model based on changing client needs. The lesson isn’t to copy what they do, but to embrace their philosophy: meet families where they are, provide surgical solutions to specific problems, and maintain the flexibility to adapt as needs change.
The modern family office isn’t about having every capability in-house. It’s about having access to the right capabilities, precisely when you need them, delivered by partners who understand that your family’s needs are unique.
