Building a family office from scratch: A roadmap for first-gen wealth creators

Creating wealth is one milestone, protecting and managing it for generations is another. Many first-generation entrepreneurs are now realising the need for a family office to streamline their finances, investments, and legacy goals.

As per industry findings, India is witnessing rapid growth in family offices, with the number rising from just 45 in 2018 to nearly 300 in 2024. This surge is driven by the expanding Ultra-High-Net-Worth Individual (UHNWI) population, with surveys revealing that over 13,000 families in India have wealth of more than $30 million.

A family office serves as the backbone for financial organisation, managing everything, from investment management and estate planning to philanthropy and succession. Setting one up from scratch might sound daunting. But with the correct approach, it can help secure both your family’s financial future and legacy. Here is how you can get started on this journey.

Define your vision and purpose

Before setting up your family office, define why you need it. Is your goal to preserve wealth for future generations, manage complicated investments, or create an impact through philanthropic efforts? Having a clear purpose will shape the structure and operations of your family office.

Family and business interests are intertwined, which makes it essential to establish guiding principles that align financial goals with family values. A proper vision also helps maintain consistency in decision-making and ensures every generation understands and upholds the same objectives.

Decide on the structure and governance

The next step is to decide on the family office type that matches your needs and financial scale. A single-family office concentrates entirely on your family’s requirements, offering complete control and personalisation. However, a multi-family office provides shared services, which minimises operational costs.

Governance is equally essential; it ensures accountability and prevents conflicts. Define roles, responsibilities, and decision-making processes. Prepare committees or advisory boards that represent different family members’ interests.

In India, where joint decision-making is common, having formal governance mechanisms keeps communication open, transparent, and fair.

Concentrate on professional investment management

A family office thrives on how well it manages and grows the wealth of the family. Strong investment management is at its core. The goal should be to create a diversified portfolio that balances safety and growth across asset classes, i.e., equities, bonds, mutual funds, real estate, private equity, and even global opportunities.

Family offices are increasingly exploring international markets for better diversification. It is important to work with experienced portfolio managers who can prepare strategies as per your family’s risk appetite, investment horizon, and goals. Periodic performance assessments, benchmarking, and risk monitoring help maintain financial stability over the long term.

Integrate estate and succession planning

Building substantial wealth is just one part of the journey. The other is ensuring it is passed on in a smooth manner. Integrating estate planning helps safeguard your assets and ensures they are distributed as per your wishes. This involves drafting proper wills, setting up trusts, managing taxes in an efficient way, and planning for seamless business continuity.

For first-generation wealth creators, where business and family boundaries often overlap, a structured succession plan prevents future conflicts and ensures leadership transitions are seamless.

Build a team of trusted advisors

Setting up a family office requires expertise across finance, law, taxation, and investments. Surround yourself with trusted professionals, i.e., chartered accountants, legal advisors/professionals, and wealth managers, who understand your goals well.

In India, where financial regulations and family dynamics can be complicated, having the correct team ensures your office runs efficiently and adapts to changing requirements.

Ending note

Building a family office from scratch is like laying the foundation for your family’s financial legacy. For first-generation wealth creators, it is an opportunity to turn success into a structured system that preserves and grows wealth across generations.

With a proper vision, expert investment management, prudent governance, and thoughtful estate planning, a family office becomes more than a financial setup; it serves as a trusted guardian of your family’s future.