Managers who deliver more consistent performance tend to take a fundamentals-based approach to value creation.<\/p>\n\n\n\n
Musci:<\/strong> \u201cWe started investing in private equity over 20 years ago. Today we hold a portfolio diversified by vintage, strategy, and geography.\u201d<\/p>\n\n\n\n Family offices are highly diverse structures that support wealthy families in managing their assets, planning wealth transfers across generations, and handling governance matters arising from the complex intersection between business and family wealth. But how do these entities invest \u2014 and, in particular, how do they approach private markets?<\/p>\n\n\n\n At the 4th Digital Forum on Private Markets<\/strong> organized by We Wealth<\/em>, Gabriele Besacchi<\/strong>, Managing Director and Head of Private Markets at AlTi Tiedemann Global Suisse<\/strong>, and Emanuela Musci<\/strong>, Co-founder of S&O Multi Family Office<\/strong>, shared their experiences.<\/p>\n\n\n\n \u201cWe were founded as a single-family office between the late 1980s and early 1990s, following a liquidity event within a family,\u201d recalls Musci. \u201cOf course, the investment landscape back then was nothing like it is today. However, the founding family already owned two companies in the United States since the 1970s. They were therefore accustomed to observing what was happening overseas and how their American peers invested,\u201d she continues.<\/p>\n\n\n\n \u201cAs a result, we started investing in private equity over 20 years ago. Today, we have a portfolio diversified by vintage, strategy, and geography \u2014 one that has now become self-sustaining,\u201d Musci explains.<\/p>\n\n\n\n According to Besacchi, building a portfolio \u2014 especially one resilient to unexpected events \u2014 must always start with diversification. \u201cIt\u2019s one of the golden rules of investing,\u201d he says. \u201cWe\u2019re talking about diversification across vintages, strategies, geographies, and sectors. But that\u2019s not all. Even within the same vintage, sector, or region, manager performance can vary significantly. Therefore, careful selection is key to achieving resilient diversification.\u201d<\/p>\n\n\n\n How should investors navigate this process? \u201cManagers who deliver consistent performance over time usually have a fundamentals-based approach to value creation,\u201d explains Besacchi. \u201cAnother critical factor is the quality and structure of the team, along with the robustness of internal processes and governance. These are all elements that cannot be overlooked when building an all-weather portfolio.\u201d<\/p>\n\n\n\n In the structuring of private market allocations, Musci believes semi-liquid products can play an important role. \u201cWe embraced them as soon as we identified them, about four years ago. In our experience, they have made our private market portfolios more efficient,\u201d she notes.<\/p>\n\n\n\n \u201cWith semi-liquid or evergreen funds, capital is fully deployed from day one \u2014 it starts working immediately. We\u2019ve analyzed studies from long-term partner firms where we invested in both drawdown and semi-liquid funds. We found that, with the same underlying assets and investment horizon, the compounding effect alone contributed positively to performance. There\u2019s also the added benefit of being able to redeem if necessary \u2014 although we believe one shouldn\u2019t enter a semi-liquid fund like an ETF, expecting to exit quickly,\u201d Musci cautions.<\/p>\n\n\n\n Given these considerations, Besacchi emphasizes that there is no predefined formula for finding the ideal mix when designing a private markets strategy. The key, he says, lies in listening. \u201cUnderstanding the family\u2019s needs makes it easier to align their risk profile and return expectations with the actual performance of different asset classes and to build the right mix,\u201d he explains.<\/p>\n\n\n\n \u201cHowever,\u201d he adds, \u201ceven with sophisticated models designed to predict future cash flows, there will always be internal and external factors that can affect outcomes. It\u2019s therefore essential to maintain reasonable flexibility in terms of liquidity.\u201d<\/p>\n\n\n\n <\/p>\n\n\n\n\u201cWe Started with Private Equity Over 20 Years Ago\u201d<\/h2>\n\n\n\n
Building a \u201cBlack Swan\u201d-Proof Portfolio<\/h2>\n\n\n\n
The Role of Semi-Liquid Products<\/h2>\n\n\n\n
Finding the Ideal Mix in Private Markets<\/h2>\n\n\n\n