Family offices can combine delegated fund investments with selected direct company investments and secondaries. Relationship flow only. Paths do not represent capital allocations or transaction probabilities.
Family Office Ways to invest
Family offices can combine delegated fund investments with selected direct company investments and secondaries.
View chart data and assumptions
| Route | Destination | Context |
|---|---|---|
| Funds | Route | Delegated, diversified exposure. |
| Co-investments | Governance | Targeted company exposure. |
| Secondaries | Timing | Existing private shares. |
A Family Office Guide to Venture Capital Investing
UBS's 2025 Global Family Office Report shows private-market allocations remaining significant even as some family offices reassessed direct private-equity exposure. The allocation is real, but uneven. Family offices may use funds, direct investments, co-investments, and secondaries in very different proportions. Venture should be sized around liquidity, governance, and monitoring capacity, not only long-term return ambition.
Many private funds require planning around an 8- to 12-year term, before considering extensions or delayed exits.
A family office can appear diversified across several funds and SPVs while holding the same private companies through each route. The overlap may remain hidden until a financing or valuation change affects several positions at once. A useful portfolio view therefore combines direct holdings with the companies owned indirectly through managers and vehicles.
Why Family Offices Invest in Venture Capital
Goldman Sachs' 2025 respondents held 31% in public equities and 42% in alternatives, including 21% in private equity. Venture should be reviewed inside that total risk budget.
Family offices may use venture capital for several connected reasons. Private-company access may involve investing in businesses before a possible public-market listing. Portfolio diversification may involve adding exposure beyond listed equities, real estate, and other established holdings. The investor should build positions in markets that may develop over long periods.
Strategic learning can take the form of developing sector knowledge and relationships across private markets. Innovation exposure means supporting companies developing new products, services, and business models. Potential returns are part of the appeal, but they are not the only reason a family may build the allocation.
The Place in the portfolio
UBS reported 54% in alternatives for surveyed US family offices, including 27% in private equity, 18% in real estate, and 3% in private debt.
Venture should have a clear purpose within the broader family balance sheet. Some families begin with a modest allocation for long-term growth, while others connect the programme to operating-company expertise or next-generation interests. The right role depends on liquidity, the existing private-market portfolio, the time available for oversight, and the family's tolerance for long holding periods.
Funds Versus Direct Investments
UBS put global private-market allocations at 21% in 2024; among offices planning allocation changes, the intended level was 18%, with reductions concentrated in direct private equity.
A venture fund delegates selection and follow-on decisions to the manager. A direct investment gives the investor more company-level control. A family office should assess honestly whether it has the team, decision speed, and process required to assess individual companies.
Co-Investments and Secondaries
In practice, the choice changes what the investor must do. Carta estimated $61.1 billion of VC secondary activity in the 12 months to June 2025, slightly above $58.8 billion of VC-backed IPO value.
Co-investments and secondaries can add a focused investment to a company, stage, or sector. The differences still matter.
Understand why the opportunity is available and how decisions are made. Limited information can take the form of match position size and conviction to the evidence provided.
Before proceeding, the investor should confirm company approvals, rights of first refusal, and other conditions. The investment may depend on one financing and exit path. These opportunities should be assessed as investments, not accepted as relationship courtesies.
Concentration, Liquidity, and Horizon
Venture outcomes are uneven, and reported diversification can hide overlapping exposure. Combine holdings across funds, SPVs, direct investments, and personal positions. Identify company, sector, sponsor, geography, and financing-cycle overlap.
Successful businesses may remain private for years. Model liquidity conservatively rather than assuming exits will arrive on schedule.
Illustrative Net LP Return Sensitivity
Use the controls to see how commitment size, deployed capital, portfolio outcome, and holding period affect an illustrative family-office investment result.
Illustrative LP Scenario
Sensitivity Model$26.24M
$15.04M
$26.24M
2.34x
15.2%
Important: This simplified sensitivity analysis is educational and illustrative only. It is not a forecast, investment recommendation, or representation of expected Frontierspace results. Actual fees, expenses, cash-flow timing, taxes, follow-on capital, losses, and liquidity outcomes may differ significantly.
How to Evaluate a Manager
These questions help separate a strong case from a weak one. What specific advantage gives the manager access to attractive opportunities? Can historical investments be connected to the people managing the proposed fund? Do company count, check sizes, ownership, reserves, and stage fit the fund size?
The practical details matter as well. How does the GP assess valuation, security, and ownership? What capital has the GP committed, and how is that commitment funded? Does reporting explain operating developments and changes in value, including negative ones?
How a Family Office Can Put the Pieces Together
Frontierspace focuses on private technology opportunities across venture, growth, and secondary markets. For family offices, our review centers on the full investment.
The investor needs clear answers to the following questions. Does the business support long-term ownership? Is the competitive and industry setting attractive?
There are a few more points to resolve. Do the valuation, security, and terms provide a sound basis for investment? What realistic routes and timelines could convert the position into cash? A well-known company name does not replace this work.
Stripe: how a family-office platform joined an institutional round
Stripe's 2023 Series I included MSD Partners alongside GIC, Temasek, Goldman Sachs Asset and Wealth Management, and established venture investors. The transaction funded shareholder liquidity rather than operating needs.
The financing valued Stripe at $50 billion.
The investor group also included sovereign and capital from larger investors.
Shares were retired to offset issuance and address employee tax obligations.
Family offices can participate beside institutions, but the relevant question is still fit with the rest of the portfolio. A large private deal may combine growth exposure, secondary liquidity, concentration, and delayed exit timing in one position.
Primary sources: Stripe, Series I and employee liquidity (2023). Based on public transaction information; unrelated to Frontierspace performance.
Frequently Asked Questions
Should a family office invest directly or through funds?
Many use both: Funds can provide diversified, a portfolio selected by the manager, while direct investments and co-investments offer company-level choice.
- Funds: May fit when the office wants delegated selection, monitoring, and reserve management.
- Directs and co-investments: Require stronger company diligence, faster decisions, and explicit concentration limits.
How should liquidity be assessed?
Assume capital may remain invested beyond the base case: Review capital-call timing, follow-on requirements, fund extensions, and secondary-sale options under weaker market conditions.
Qualified prospective investors can request private investor materials following review. For related reading, see private technology co-investments and secondaries.
Related Reading
Family office co-investment checklist, VC allocation mix, and VC commitment timing.