Coronavirus – Context, History and the Family Office


“What’s true of all the evils in the world is true of plague as well. It helps men to rise above themselves.” So said Albert Camus in his novel “The Plague”, published in 1947 telling the story of a plague sweeping the French Algerian city of Oran.

Our “Plague” is Coronavirus and it has changed our lives globally. We are all feeling the impact of lockdown and learning to cope with the new “normal”.

Are Family Offices managing to “rise above themselves” during this time?

Worldwide deaths stood at 227,051 ( on 30th April which is of itself shocking and it is unclear what the total numbers might look like by the time we are through this crisis. According to Business Insider (, more than a third of the world’s population is now (April 2020) living under some form of lockdown due to coronavirus, some 2.6 billion people. So, whilst during other crises we have been able to gather comfort from the society of friends and family, now we have to deal with our fears and concerns, isolated from those we love and care about.

“Unprecedented times” is a phrase that we are hearing constantly at the moment and whilst it is true that we have never experienced anything like this particular pandemic before, humanity has certainly endured calamity and catastrophe throughout its history:

  • The Spanish flu pandemic which lasted from January 1918 to December 1920, infected an estimated 500 million people worldwide, then around one-third of the world population. Estimates of mortality range between 20 million to 50 million and some suggest a much higher number.
  • The Black Death which peaked in Europe between 1347 and1352 was one of the worst catastrophes in recorded history and ravaged communities across Eurasia and North Africa, changing forever their social and economic fabric. In Europe, it is thought that around 50 million people died as a result of the Black Death or 60 per cent of Europe’s entire population (Ole Jørgen Benedictow – Norwegian historian especially known for his work on plagues).
  • The Second World War as its name suggests, left no corner of the world untouched. Deaths are estimated in the region of 60 to 70 million worldwide.

As well as threats to our lives, we have endured and survived economic and financial disasters.

  • The Great Depression in the 1930s saw the US stock market lose almost 90% of its value and around 300 companies go out of business. By 1933 about 15 million Americans were jobless and almost half of the United States’ banks had failed.
  • More recently we had the Global Financial Crisis of 2007/2008 which brought down behemoths of the financial market place such as Lehman Brothers, Bear Stearns and Washington Mutual. Many others including Merrill Lynch, AIG and Royal Bank of Scotland came within a gnat’s whisker of failure and had to be rescued.

Each of the above was a calamitous event which had a huge impact on lives across the world, taking no heed of race, creed or colour. “Death is no respecter of persons. Natural disasters are no respecters of nations” – Nkwachukwu Ogbuagu” (Nigerian poet, novelist, artist and musician).
We are now facing arguably (hopefully!) the biggest calamity in our lives and it is difficult at times to look beyond the next day, to see any light at the end of the tunnel. But if we are mindful of and if we can learn from those dark days in history, we can be hopeful of a return to the light and brighter days to come.

Some of the changes we are facing are but the revisiting of past times. There is a sudden upsurge in the growing trend toward cashless transactions and the use of card payments, on the basis that the less that money changes hands, the less likely disease is to be spread.
In “A Journal of the Plague Year” by Daniel Defoe, published in 1722 he says – “The butcher would not touch the money, but had it put into a pot full of vinegar, which he kept for that purpose. The buyers carried always small money to make up any odd sum, that they might make no change…”. The same perceived danger, ‘though addressed with slightly different strategies.

What is the impact on you and your Family Office?

Everyone has had to implement drastic changes in the running of their Family Office, to allow business to be continued by staff who are forced to work from home. “Pop-up” dealing rooms are appearing in spare bedrooms, Bloomberg terminals appearing in the suburbs.
Aside from the logistical issues faced by all, how are Family Offices positioned and how are they reacting to the new world order? How do they differ from other investors?

Family Offices are set up for various reasons but two of the most oft quoted are confidentiality and control and of those, control is almost universally the main driver.
Generally, the Family Office will control the management of the family assets, handling investments, taxation, legal matters and increasingly, philanthropic work. “Family” is the important word here as part of the responsibility is to ensure that succession planning for the next generation is part of the overall strategy. As a result, a Family Office will typically be looking at planning for the next three generations or so meaning that the investment strategy is likely to be very much long term focussed with a view to legacy planning. This in itself offers some protection for specific events that have a catastrophic but frequently short-term effect on the financial markets and therefore the family’s portfolios.

How are Family Office investments placed in this new world?

Our soon to be published Family Office Compensation Benchmark report (global and in greater detail than ever before) indicates that internationally, the leading asset classes that Family Offices invest in are Private Equity, Public Equity and Property. Globally there is also a very consistent trend with regard to return on investment and the large majority of Family Offices achieve a return of between 7.1% – 10%.

According to Family Offices generally are optimistic about the investment future and “60% of family offices believe in a significantly better situation (on financial markets) in 12 months and 66,7% believe in a slightly better situation in 6 months.” As Churchill said, a “pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”

Other SFOs are actively anticipating opportunities and where there are otherwise strong companies facing short-term capital issues, there may be the opportunity for a serendipitous partnership, the white knight SFO coming to their aid and then remaining as a long term investor and partner, helping them to grow once the storm is weathered. According to a study by conducted with Family Offices both in the USA and Europe, most “family offices are already exploring investment opportunities, like distressed equity or bonds”, and many Family Offices are targeting “tech stocks (like Facebook, Apple, Netflix, Google) as well as food companies. Others are preparing private equity purchases”.

According to a Bloomberg article in September last year, some 40% or more of Family Offices were “Stockpiling Cash” on fears that the global economy would enter a recession by 2020. Although this view was not built on the anticipation of the specific event under whose shadow we find ourselves, many Family offices have been sitting on the side-lines as markets fell, and they are well placed to invest when they judge the right time and opportunity. Euromoney stated recently that consultants at Bain had calculated long-term investors including Family Offices, had more than $2 trillion of investment capital ready to deploy.
There are obvious sectors to search in for these opportunities, such as Healthcare and the “work-from-home” economy and Family Offices can enjoy the possibility of astute investment doing tangible good at a time of hardship, as well as being financially advantageous. Again according to (March 23rd 2020), “most family offices portfolios performed quite well during the last weeks: 57.1% had losses between -10% and 0% since the 25th of February. 14.3% of surveyed family investment firms even managed to reach a performance between 0-10%.”.

With the rising influence of the next generation of decision makers in Family Offices, there is an increasing movement toward Impact Investing.
Greta Thunberg said at the US Congress in September 2019 “This is not the time and place for dreams. This is the time to wake up. This is a moment in history where we need to be wide awake.”
This is a message that will resonate with many Millennials, born into a family that already has successfully built their wealth. They are looking at more than financial success to form their legacy and there are a growing number who see the positive difference that they can make to their world being just as important as maintaining/building their wealth. It is not a surprise that impact investing is high on their agenda.

Campden Wealth’s recent article suggests that the “ethos of impact investing for positive change seems tailor-made to tackle the devastating repercussions of the coronavirus”.

With carbon emissions falling as factories close and transport use plummets, we are for the first time in generations, seeing clear waters in the usually muddied canals of Venice. According to researchers in New York, “carbon monoxide mainly from cars had been reduced by nearly 50% compared with last year” (BBC news) whilst in the UK, government data “shows a dramatic fall in the use of public transport, with rail travel down 90%, and tube and bus journeys in London down by 94% and 83% respectively” ( 3rd April 2020). Investors in clean tech and the like may well find their investments for the good of the environment, have paid dividends to their portfolios.

Family Offices “have a chance to capitalize on opportunities rarely seen in the markets…because this public health emergency, as severe and costly as it is, will eventually pass. Even if other sectors of the economy take longer to recover, the rebound for family offices… could very well come more quickly“ (
With the pursuit of a vaccine for COVID-19, investors in biotech may stand to make a lot of money, especially if the companies they are backing are in the vanguard of those producing successful vaccines and effective treatments.
AstraZeneca has teamed up with Oxford University, with an agreement to manufacture and distribute any effective COVID-19 vaccine that the University manages to develop. Moderna Therapeutics based in Cambridge – Cambridge Massachusetts that is! – has recently “sent the first batches of its coronavirus (COVID-19) vaccine to the US-based National Institute of Allergy and Infectious Diseases for testing on human testing” ( and many other pharmaceutical companies including Pfizer, GlaxoSmithKline, Gilead Sciences and Johnson & Johnson are all striving to deliver a vaccine that will put us on the path back to the new “normal”.

Biotech is of long standing popularity to the Family Office investment community and Family Capital ( estimates that “around 20% of all venture investing done by family investment groups goes into biotech and healthcare”. As a group, they are potentially well placed to survive, even to prosper in the current turbulence of Coronavirus and its associated disease, COVID-19.

Family Offices and staffing during the crisis

With lockdown across the world and particularly in the densely populated Financial Centres where a lot of Family Offices are based, Lockdown has had a tremendous impact on staffing. Generally offices are closed and people are working (where they can) from home.

In the UK, the Government’s Coronavirus Job Retention Scheme (CJRS) is helping across the board to prevent otherwise unavoidable redundancies. But that leaves a small number of people covering for those who have been furloughed compounding stress and strain at an already challenging time. If there were gaps in staffing before the Coronavirus hit, the stress and anxiety will be even greater.

Some Family Offices we are working with are keen to progress with the hires they were looking to make but are now unable to follow through with the process to completion.

In some cases the candidate has been identified, interviewed, offered and accepted the new role but with the Lockdown, the office is closed and it is impossible to onboard them or undertake any kind of induction or handover.

Other SFOs have identified a need and were in the process of conducting candidate interviews only to have their time hijacked, diverted to crisis management and the logistics of moving existing staff offsite to work from home. The new working model may also raise other complications such as looking at security of information whilst staff are working off site, supporting or advising operating businesses in their portfolio or restructuring the asset allocation of the portfolio, implementing changes or acting on perceived new opportunities.

In some cases the actual staffing needs may change but planning ahead for what their SFO will need in the next phase – the road toward the lifting of restrictions and the return to the new “normal” – will be crucial toward its future success.

We continue to work with clients with active mandates, keeping candidates aware when processes have gone on hold, arranging video-conference interviews and in some cases, sourcing emergency cover at short notice when the need has arisen.

Where there remains a need to recruit, interviews are taking place virtually with a view to identifying a short list for face-to-face meetings when that becomes possible. These virtual interviews can be followed up by virtual meetings with other members of the team, gaining insight into the compatibility of a potential new staff member, into the team and the particular culture of the office.

When the exit strategy from Lockdown is finally implemented and there is a view on returning to physical offices once again, when the initial logistics of a return and the first priorities of re-engagement are completed, pending recruitment needs will be readdressed. Clients who have used their Lockdown time to initiate/continue processes and are in a position to go straight to final interviews, will have the best choice of available candidates and will be able to get them on board much more quickly than those who have to start the process from scratch.
There will of course be a larger pool of candidates available for a time – and nobody can predict quite what this new landscape will look like – but planning ahead when you do have time, is always time well spent. “By failing to prepare, you are preparing to fail” (as attributed to Benjamin Franklin).


COVID-19 has had a devastating effect on world health and the global economy and in such a way that we are isolated and very much in unchartered waters.

There are a huge number of variables to deal with.

Regarding investing, do you focus on capital preservation or are you optimised for new opportunities? What has been the impact on operating businesses that you own and what steps need to be taken to help them. Do you shore up balance sheets or adjust your asset allocation and liquidate holdings rather than kicking the can down the road?

What has been the effect on the running of your Family Office? How are you managing the daily operations and processes. How are you maintaining the security of information with people working from home? How are you looking after the health and safety of your staff?

We can take some comfort in the fact that previous generations have felt that they have witnessed the most awful events of humanity and have lived to tell the tale. “Even with all our technology and the inventions that make modern life so much easier than it once was, it takes just one big natural disaster to wipe all that away and remind us that, here on Earth, we’re still at the mercy of nature – Neil deGrasse Tyson (American astrophysicist, author, and science communicator).
The COVID-19 experience has provided a sobering reminder of the precariousness of the human condition but we can look to the future with a legacy of facing down and conquering disasters in the past.
“Difficulties mastered are opportunities won” Churchill said and “a pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”

In his 1963 interpretation of Darwin’s “On the Origin of Species”, Professor Leon C. Megginson stated that “it is not the most intellectual of the species that survives; it is not the strongest that survives; but the species that survives is the one that is able best to adapt and adjust to the changing environment…”.

Family Offices are generally small. Family Office employees invariably find themselves taking on frequently changing, expanded, even different roles to that which they were initially employed for. Family Offices attract people who are problem solvers, people without a rigid view of their role (and certainly not of their own self-importance!).

Family Offices are adaptable – and as a result, they are probably as well equipped as any to ride out the current storm and navigate to calmer waters and a safe harbour.
“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails” (William Arthur Ward).

Fair winds and following seas to you all!

(April 2020)

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