Family Office: A brief history


Family Offices, in one form or another, has assisted families to manage, protect, and grow family wealth since the beginning of modern civilisation.


A family office is a private entity with highly skilled professionals equipped to support a family with financial administration, estate planning, investment management, philanthropic endeavours, structuring, taxation, and all other financial requirements. The ultimate goal of a family office is to preserve and grow the family wealth, allowing all family members to achieve their long-term financial and personal life goals.

The family office has become a financial phenomenon over the last few decades. To truly understand the concept, it is worth exploring its origins and following its development to becoming an established phenomenon of modern finance.

The birth of the family office

In ancient times, the majority of wealth was owned by leaders and royalty who accumulated large portions of land, livestock, gold, and high-value gems.

Examples of ancient wealthy leaders and royalty include the first Roman emperor Augustus (27 BC - AD 14), Emperor Shenzong (1048 to 1085) of China’s Song Dynasty, Breton nobleman and 1st Lord of Richmond Alan Rufus (1040 to 1093), Mansa Musa I (1280 to 1337) of Mali, and Akbar the Great (1542 to 1605) of India’s Mughal Dynasty.

Even though these leaders lived in vastly different centuries and countries, they all entrusted the management of their wealth to highly competent and experienced representatives, not unlike that of family office professionals today.

The modern family office

The modern concept of a family office emerged in the 19th century. J.P. Morgan, the New York banker who dominated corporate finance on Wall Street throughout the Gilded Age, founded the House of Morgan in the mid-1800s to manage his family assets.

John D. Rockefeller, the American business magnate who made his fortune in the American petroleum industry, founded his family office in 1882. Rockefeller became the first American billionaire, his fortune equal to 2% of the American economy. The Rockefeller wealth is housed in family trusts, most of which are still active today. These trusts own shares in the successor companies to Standard Oil and house the family’s diversified investments and considerable real estate holdings.

Throughout the 20th century, many other wealthy American figures emerged and followed J.P. Morgan and John D. Rockefeller’s lead. However, it was only during the latter part of the 20th century that the family office became an institution and made its way to the rest of the world.

The growth of the South African economy in the 20th century contributed to the establishment of family offices for the wealthy industrialists and miners of the era.

Sir Ernest Oppenheimer was a diamond and gold mining entrepreneur who controlled De Beers and founded the Anglo American Corporation of South Africa Ltd. The Oppenheimer family interests are controlled by the Oppenheimer family office.

Dr. Anton Rupert founded Rembrandt Ltd, the tobacco and industrial conglomerate, with a personal investment of just £10 in the 1940s. Rembrandt Trust was incorporated to house the various Rupert family investments.

Dr. Patrice Motsepe founded African Rainbow Minerals Ltd, South Africa's first black-owned mining company. He subsequently established the African Rainbow group of companies as the family investment vehicle to house his investments.

The family office and philanthropy

Many family offices are engaged in philanthropic endeavours to give back to society. The Bill & Melinda Gates Foundation is the largest and most famous private philanthropic endeavour in the world. It was launched in 2000 by Microsoft Corporation founder Bill Gates and his wife Melinda. The primary goals of the foundation are to enhance healthcare and reduce extreme poverty across the globe, as well as to expand educational opportunities and access to information technology in America.

Regulatory complexity

Families today face an increasingly complex landscape in which they are required to manage their wealth. Trusted advisors are required to navigate the legislations regulating company, compliance, finance, foreign exchange, investment, property, succession, trust, tax, and other related fields.

The future of the family office

The growth in the number of wealthy families and the complexity of the investment and regulatory landscape will increase the demand for family office services to efficiently manage, protect, and grow family wealth.

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