Julie Meyer is Founder and Chief Executive Officer of Ariadne Capital, which helps wealthy entrepreneurs invest in high-growth firms. "These wealthy entrepreneurs" she says "are very hands on people…they have built successful firms, so know what it takes to control all of the variables to exit. They are control freaks." Ms. Meyer also notes that these wealthy investors (often with a technology background) monitor their investments carefully; some even create online dashboards so that they have 'on-demand' information about their positions and stakes.
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As Head of Research at the US-based Family Office Exchange, David Lincoln starts from a rather different perspective, but he sees similar developments. As he puts it: "The disruptive effects of all this volatility and uncertainty has made people pay closer attention to how their wealth is actually being managed and what types of processes and what type of safeguards they have in place."
Gerard Aquilina of Barclays comments: "Wealthy individuals are, indeed, taking plenty of time over their investment strategy. They are asking more questions, taking more responsibility for their investments and performing considerably more 'due diligence' on, for example, issues such as counter-party risk which were not major worries a few years ago. Many family offices have expanded, both in terms of staff numbers and skills. Wealthy investors are more concerned about fees and costs in general,"- a point echoed by Mr Lincoln.
Mr Aquilina argues that wealthy investors remain keen on emerging market equities, because of the higher returns potentially available from these markets, and also because of their increased depth and sophistication compared with a decade ago. He suggests, "While investors may be upbeat about the possible performance of hedge funds and private equity, there is still a reluctance to invest in these asset classes."
Looking forward, Mr Aquilina thinks that increased investor involvement will continue, along with the focus on fees. Like Ms. Meyer, he thinks that technology will become increasingly important in providing personalised investment performance reporting to clients.