A growing number of single family offices are building the internal capability to source and underwrite private deals directly, reducing their reliance on external funds and the fees those funds charge. The shift reflects both the scale some family offices have reached and a frustration with the cost of intermediated access.
Direct investing is harder than it looks. It requires origination, diligence, and the patience to hold assets through cycles, all capabilities that funds spent decades building. The family offices that succeed are the ones that hire real operators and resist the temptation to treat direct deals as a hobby.
The build-versus-buy question
For most family offices, the honest answer is a blend. They co-invest alongside trusted managers to learn, build internal teams for the sectors they know best, and keep paying for fund access where the manager's edge is genuine. The all-in-house model works only at real scale.
What is clear is that the family office is no longer a passive limited partner. Increasingly it is a competitor for deals, a co-investor with real leverage, and a client that expects transparency the old fund model was not built to provide.