Canada with its thriving economy supports the formation and transaction processes in businesses of all the country’s different key industries: agriculture, energy, technology, services and manufacturing. Direct access to ports and the commitment to public transport form an innovative, green and progressive business climate. Given these conditions and the fact that investments in the fields of traditional capital markets are becoming riskier every day during the recent crisis, single family offices, the private investment companies associated with the richest and wealthiest individuals, are focusing on private equity investments to balance their portfolios. As part of our database of the largest single family offices in Canada, we want to present you three Canadian single family offices, that pursue private equity investments.

The mentioned family offices are all part of our list of the largest single family offices in Canada

  • 30 entries, thereof 20 with general e-mail address, 26 with executive names
  • Investment focus: Real Estate, Venture Capital, Private Equity, Financial Products, Renewables
  • 23 columns included: name, family name, estimated family wealth, detailed investment focus and exemplary investments, address, phone, e-mail, website…
  • Free updates within one year included, secure payment through PayPal or Credit Card, 24/7 support through live chat and mail

#1: Tricor Pacific Capital

Vancouver-based and established in 1996, the company’s original goal was to carry out private equity transactions, using the owner family’s, as well as institutional funds to invest in middle-market companies across North America. Until today, Tricor Pacific Capital has evolved into a single family office that solely invests its own capital. Under the direction of Rod Senft, the investment company managed four separate funds with a total committed capital of $1.2 billion, focusing on real estate and private equity. Preferred industries are real estate, food, industrial and transportation with a strong focus on middle market companies. Tricor Pacific Capital, for example, is invested in Dinoflex, a leading innovator in the manufacturing of recycled rubber products and specialist in producing premium quality rubber flooring, surfaces, tiles and custom products. Rockmount Research and Alloys is another exemplary private equity investment of Tricor Pacific Capital. The industrial company is a leading supplier of high-quality repair and maintenance welding alloys specifically designed to weld stronger and last longer.

#2: Hedgewood

Hedgewood Inc. serves as the private investment firm of the the co-founder and past Chairman & CEO of WebHosting.com and InQuent Technologies: Jesse Rasch. In addition to WebHosting.com and InQuent Technologies Jesse Rasch also co-founded CareGuide. Hedgewood Inc. was founded in 2000 and is headquartered in Toronto. InQuent provides private label hosting solutions to telecommunications customers. WebHosting.Com was one of the largest business web hosting companies in the world. In 2000, Rasch sold InQuent and WebHosting.Com to AT&T. As a global thinking investor, Hedgewodd Inc. focuses not only on transactions in Canada and the United States, but also seeks for global investments. Besides private equity, investments are made in venture capital, capital markets, lending and real estate.

#3: Marin Investments Limited

Vancouver-based Marin Investments engages as the private investment vehicle of the Young Family and was established in 1952. Since 1982, Charles Young, graduate of Stanford and Harvard Business School, leads the investment firm. Marin Investments Limited back then started investing with a major controlling interest in Finning Tractor and Equipment, the largest Caterpillar distributor worldwide. It didn’t take long and the firm expanded its investment activities to real estate, private equity and stock markets. Tantalus is part of Marin’s private equity portfolio and delivers measurable and meaningful operational savings through their multi-purpose Smart Grid solutions platform for Advanced Metering, Demand Management, Distribution Automation and Grid Optimization. Another investment is prepac, a successful North American designer, manufacturer and drop shipper of functional and stylish RTA (Ready-To-Assemble) home furniture.

Picture source: Aditya Chinchure

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Consistently ranked among the most liveable cities in the world, Vancouver offers many competitive advantages for firms. Natural beauty, direct access to beaches and ports and its commitment to public transport form a business climate which is innovative, progressive, green and approachable. Its diverse economy includes exciting growth in the green and technology sectors, as well as a rapidly expanding creative sector. This is especially true in technology, digital entertainment and interactive, and the green economy, as well as more traditional industries including tourism, forestry, mining, transportation and logistics. So it’s not a surprise that many of the private investment firms linked to the most wealthiest individuals, so called single family offices, are located in Vancouver. As part of our research database of the largest single family offices in Canada, we want to present you three family offices that have their headquarters in Vancouver.

The mentioned family offices are all part of our list of the largest single family offices in Canada

  • 30 entries, thereof 20 with general e-mail address, 26 with executive names
  • Investment focus: Real Estate, Venture Capital, Private Equity, Financial Products, Renewables
  • 23 columns included: name, family name, estimated family wealth, detailed investment focus and exemplary investments, address, phone, e-mail, website…
  • Free updates within one year included, secure payment through PayPal or Credit Card, 24/7 support through live chat and mail

#1: Wychwood Capital

Founded in 2008, the Wychwood Capital single family office supports the investment and trust activities of their family businesses already in the third generation and thrives to reduce overall correlation to major asset classes with its investments. The origin of the family business can be traced back to 1933, when the first generation founded a transportation company in Hong Kong. From the beginnings, the family expanded its interests to local and overseas property management, real estate development and diversified portfolio management. Today, the family office invests actively in venture capital & private equity transactions, focusing on the private growth & seed stages. Furthermore, investments in the traditional capital markets are made through hedge funds, futures and credit trades.

#2: Tricor Pacific Capital

The leading Canadian single family office actively invests the capital of its owner family. In 1996 the investment firm was founded in order to carry out private equity transactions, using the family’s, as well as institutional funds to invest in middle-market companies across North America. Under the direction of Rod Senft, Tricor Pacific Capital managed four separate funds with a total committed capital of $1.2 billion. Until today, Tricor Pacific Capital has evolved into a single family office that solely invests its own capital, focusing on real estate and private equity. In the field of real estate mainly transactions linked to commercial and residential properties are made. For example, Tricor owns a portfolio of purpose-built, industrial, single-tenant real estate. Private equity investments are mainly consisting of real estate, food, industrial and transportation businesses, with a strong focus on middle market companies. An exemplary investment is OCTS, a full-service container drayage and storage provider, including transloading and flat-deck trucking, who’s proud to be the first and last mile for some of the world’s most prominent steamship lines and freight forwarding companies. In addition, Tricor Pacific provides capital for some funds, e.g. for Parallel49 Equity and Spira Equity Partners.

#3: Marin Investments Limited

Marin Investments manages the private investment and wealth needs of the Young Family and was established in 1952. Since 1982 Marin Investments is led by Charles Young, graduate of Stanford and Harvard Business School. The investment activities of Marin all started with a controlling interest in Finning Tractor and Equipment, the largest Caterpillar distributor worldwide. Later on, the investment company expanded its activities to the private equity, real estate and stock markets. Exemplary investments in private equity are, for example, Tantalus and Kardium. Tantalus delivers measurable and meaningful operational savings through their multi-purpose Smart Grid solutions platform for Advanced Metering, Demand Management, Distribution Automation and Grid Optimization. Kardium is developing a revolutionary medical device for the diagnosis and treatment of atrial fibrillation.

Picture source: Mike Benna

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The Rodger Riney single family office Lightchain LLC invested in Sharpen Technologies $12M funding round. Sharpen Technologies works on cloud-based contact center solutions.

Sharpen Technologies: Cloud platform for contact centers

Indianapolis-based Sharpen Technologies develops an omnichannel contact center platform, that promises at least 5-15% ROI in 60 days (alternatively, Sharpen refunds the money for the service). Through Sharpen’s platform, agents can work from anywhere and monitoring of calls, messages, social media contact is ensured in real-time. Sharpen also belongs to the list of 5000 fastest-growing companies in America. The growth rate of the firm lied at 137% over the past three years.

Rodger Riney Single Family Office as investor

The recent funding round brings the total funding amount of Sharpen to more than $50M. In H1 2020, new bookings of the software were 236% higher compared to H1 2019. Lead investors of the round were Allos Ventures, Cultivation Capital as well as Lightchain. Lightchain is the Missouri-based single family office of the founder of Scottrade, Rodger Riney. Riney is an active startup investor, who, for example, also invested in biotech firm Geneoscopy.

Source: Businesswire, 02.10.2020
Picture Source: Arlington Research

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BITKRAFT Ventures raised €139.5M for their new Venture Fund I, focused on gaming, esports as well as interactive media. Among the investors are three important single family offices from Bruce Karsh, David M. Rubenstein and Jonathan Soros.

BITKRAFT Ventures: Leading esports venture capital fund

The San Francisco-based venture capital fund BITKRAFT was founded by veterans of the gaming industry. General Partner Jens Hilgers is the co-founder of the esports league ESL, Malte Barth has more than 20 years experience in executive roles in the media and gaming industry, Scott Rupp has more than 20 years of experience at Modern Times Group, McKinsey or Carlyle. BITKRAFT focuses on funding of Seed and Series A investments. A special focus is on game studios, gaming platforms and “immersive technology”. The main thesis of the fund is that physical and digitial worlds converge – and BITKRAFT is with its investments amid the changing media, gaming and esports environment. Portfolio companies include Askott Entertainment, EPIC Game, Koji or Manticore Games.

Major US single family offices invest in new €139.5M gaming fund

Now, €139.5M were raised for the new Venture Fund I. The round was significantly oversubscribed: the nitial target for the raise was at €105.8M. Besides corporate investors as Adidas or Logitech, also three different major single family offices invested in the round. Bruce Karsh’s single family office, Carolwood Capital Management LLC, was one of the investors. Karsh is a billionaire and founder of Oaktree Capital Management. Another single family office investor is Declaration Partners, the single family office of David M. Rubenstein. Rubenstein is one of the co-founders of private equity giant Carlyle – and also a billionaire. Also, the family office of Jonathan Soros participated in the round.

Source: EU Startups, 30.08.2020
Picture Source: SCREEN POST

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When two family office professionals meet in 2020 and discuss their venture capital investment strategy it is very likely that they will discuss Europe’s fintech startups. Especially the so-called challenger banks are pushing in a multi-billion dollar industry, thereby capturing market shares from traditional banks at breathtaking speed. Challenger banks want to offer a better customer experience for less money. Lean structures, fancy mobile banking apps and innovative services are the foundation of “neobanks” like Revolut or N26. Europe’s family offices – the investment firms of high net worth families – are already playing a major role when new funding rounds are due. We are thoroughly investigating where which family offices are investing – and where investment opportunities for smaller family offices arise.

1) Overview of Europe’s challenger banks

In this first section of our in-depth challenger bank analysis, we are introducing you to the challenger banks that are attracting the most attention of international family offices. We are giving you an overview of current customer numbers, valuations and funding amounts. The information is summarized within the following table.

Revolut Family Office Investors n26 family office investors starling bank family office investors Monzo Family Office Investors Monese Family Office Investors
Founding Year 2015 2013 2014 2015 2015
Headquarters London
UK
Berlin
Germany
London
UK
London
UK
London
UK
Total Funding $337M $683M £323M £324.7M £81M
Latest Valuation $1.7BN $3.5BN n.a. £2BN n.a. (> £1BN)
Latest Customer Number > 7M** > 5M*** > 1M** > 3M** > 2M***
Latest Revenue (2018) £58.2M* €43.6M* £1.7M* £40M** £5.5M*
Latest Profit / Loss -£32.8M* -€73M* -£26.9M* -£47.2M** -£12.7M*

*  2018 Number, ** 2019 Number, *** 2020 Number

Some striking observations are:

  • Every challenger bank is still loss making: the focus is on strong growth and customer acquisition.
  • N26 has the highest valuation ($3.5BN), followed by Monzo (£2BN)
  • All the main challenger banks managed to accumulate millions of customers within just a few years. Revolut has the most customers (>7M) once again followed by German competitor N26 (>5M)

A speaker of the venture capital firm Earlybird Capital (who is also an investor in N26) explains why challenger banks are interesting investment targets for VCs and family offices:

“Retail banking markets across Europe are large and growing, while incumbent banks have long lost their ability to capture this tremendous value. This is because they have not yet reached the “amazon-age” of service levels and operational efficiency. They are not agile enough to address evolving consumer demand. In contrast, challengers have fundamentally innovated the bank business model. They have automated, fully digital operations without the need for physical outlets. They iterate fast. They build personalized products by thinking like the customer. Most importantly, they turn the old model upside-down by offering true platform functionality: Neobanks are integrating an ecosystem of financial products and letting customers choose the best ones, while incumbents are not able to offer products other than their own without significant changes to their technical infrastructure. Consequently challengers are significantly better positioned to bank happy customers and do so profitably and at growing market shares. Doing so, they are tremendously successful, opposing the trend of incumbents retreating more and more from retail banking.”

Before we start with our in-depth analysis of Europe’s challenger banks: don’t miss to sign up for our free monthly family office newsletter. We are reporting about the latest investments of family offices, newly founded family offices and the most important industry happenings. Already +1000 investment professionals have subscribed to our newsletter. Join now!

starling bank family office investors
Starling Bank (UK), £323M Total Funding. Investors: McPike Family Office

In 2014, Starling Bank was founded by banking executive Anne Boden, who formerly served as RBS’s Head of EMEA as well as COO for Allied Irish Banks. Starling Bank offers personal and business accounts through its modern mobile banking service. In November, the digital bank announced that it has reached one million accounts. From its strong position in the UK market, Starling intends to grow in other European countries. A major investor in Starling is the single family office of Bahamas billionaire Harald McPike. In an interview, Starling Bank CEO Anne Boden spoke about a possible IPO by 2022, and the digital-bank’s aspirations to reach break-even by 2021.

Latest Valuation: n.a.
Latest Funding Round: £60M (Venture Round)
Investors:
CIF, Merian Global Investors
Family Office Investors: Harald McPike Family Office (Bahamas)

Revolut Family Office Investors
Revolut (UK), $337M Total Funding. Investors: Nicole Junkermann Family Office, Andy Murray

Revolut is probably one of the most known fintechs in Europe. The company was founded one year after Starling Bank in 2015 by Nikolay Storonsky, Vlad Yatsenko and Tom Reavy. Storonsky was formerly a trader at well-known investment banks, Yatsenko was a software developer at Credit Suisse and Deutsche Bank. Revolut’s service is based on an innovative online banking app and certain services (like implemented cryptocurrencies and seamless currency exchange). According to Revolut, the fintech reached 5 million customers in 2020. Thereof, 250,000 customers are based in the United States. From a family office perspective, Nicole Junkermann’s investment firm NFJ Capital joined Revolut’s Series A in 2016. Also tennis legend Andy Murray was an early investor. Probably, even more family offices have stakes in Revolut, since the company also raised multiple crowdfunding rounds through Seedrs and Crowdcube.

Nik Storonsky, CEO and Founder at Revolut, gave us an answer on the question what makes Revolut special – and what differentiates it most from “common” banks:

“As a financial technology company, we are able to move faster and invest in our products and services differently than a traditional bank might. Instead of focusing on where to invest deposited funds, our primary focus is providing our customers with a beautiful and seamless experience.

Revolut’s long term goal is to build the world’s first truly global bank – where consumers worldwide are serviced via the same app operating on a single technology platform. Since we launched in 2015, we have expanded Revolut significantly beyond its origins as an FX product, adding new features such as Commission-Free Stock Trading, Cryptocurrencies, Insurances, Business Accounts and more.

We’ve also invested heavily in our engineering and data science teams, building many of our systems in-house, in line with our vision to automate, accelerate and improve the quality of decision-making across the business.”

Latest Valuation: $1.7BN (Series C, April 2018)
Latest Funding Round: $250M (Series C, April 2018)
Investors: Balderton Capital, Index Ventures, DST Global, Ribbit Capital, Global Founders Capital, Greyhound Capital, Seedcamp Point Nine Capital, Seedrs etc.
Family Office Investors: NJF Capital (Nicole Junkermann Family Office), Andy Murray as a business angel (UK)

n26 family office investors

N26 (Germany), $683M Total Funding. Investors: Aegerter Family Office, Ki-La Shing Family Office

From its headquarters in Berlin, N26 rolls out its mobile banking services to the rest of Europe and since July 2019 also in the United States. The Berlin-based fintech, founded by Valentin Stalf and Maximilian Tayenthal in 2013, reached 5 million customers in January 2020. According to CEO Stalf, the company “added more customers in 2019 than (…) in all prior years put together”. The German challenger bank achieved strongest growth in Germany, France and Austria. Many of the world’s most notable investment firms joined N26’s funding rounds. Also many family offices already invested in N26: Swiss tech millionaire Daniel Aegerter’s family office Armada Investment AG invested in N26’s Series A, Horizons Ventures – the private investment firm of Hong Kong billionaire Li-Ka Shing – invested in N26’s Series B.

A speaker of Earlybird illustrates what makes N26 an interesting investment target:

“N26 is an interesting investment target given a variety of factors that also contributed to its current success being the leading European Neobank. Its visionary founders were some of the first to recognize the growing struggle of the incumbent banks to truly address customer needs. This lead to exponential growth with now more than 5 million customers and a market leading position in 22 European States, and with a strong footprint also in the US. Most importantly, N26 is very well positioned to not only acquire the customer very efficiently but in contrast to some other Neobanks also monetize the resulting customer relationship in a highly effective manner. N26 is certainly also interesting when looking into the future, as it continues its razor-sharp focus on delivering truly digital product innovation to become the financial home for a broad category of customers.”

Latest Valuation: $3.5BN
Latest Funding Round: $170M (Series D)
Investors: Battery Ventures, Tencent Holdings, Earlybird Venture Capital, Insight Partners, Redalpine Venture Partners
Family Office Investors: Armada Investment AG (Aegerter Family Office), Horizons Ventures (Sir Li-Ka Shing Private Investment Firm)

Monzo Family Office Investors

Monzo (UK), £324.7M Total Funding. Investors: Crankstart Foundation

Monzo is another UK fintech with its headquarters in London. Led by Tom Blomfield, the mobile bank reached the 3 million customer mark in 2019. In the beginning, customers were offered a prepaid debit card and services through an app; since 2017 customers can also open current accounts. In June 2019, Monzo raised a £113M Series F funding round to accelerate its growth and to launch in the US. The new funding round was led by YC’s Continuity Fund (the later-stage investment fund of Silicon Valley’s well-known accelerator Y Combinator). Interestingly, Monzo didn’t take part in the Y Combinator progeramme and hasn’t received an investment of YC before. Several “kind-of” family offices invested in Monzo. One of Monzo’s Series D investors is the Crankstart Foundation, which serves as Michael J. Moritz’s philantropic vehicle. Moritz is a British billionaire with an estimated net worth of $4.2BN. His investment sheds a good light on Monzo: Moritz ist an early employee of Sequoia Capital and one of the most succesful venture capital investors in the world. Some of his succesful investments include Google, PayPal or Youtube. Another interesting investor is Thrive Capital, the venture investment firm of Joshua Kushner.

Latest Valuation: £2BN
Latest Funding Round: £113M (Series F)
Investors: Y Combinator, Accel Partners, Crowdcube, General Catalyst, Thrive Capital, Orange Digital Ventures, etc.
Family Office Investors: Crankstart Foundation

Monese Family Office Investors
Monese (UK / Estonia), £81M Total Funding. Investors: Karam Hinduja Family Office

Monese offers three different pricing models: a free debit card, a classic account and a premium account. Free deductions (up to certain limits), free payments and transfers in foreign currencies as well as Apple and Google Pay are included in Monese’s offering. In 2019, Monese reached one million customers. Interestingly, Monese is London- and Talin-based (Estonia). A frequent investor in Monese’s funding rounds is Tera Ventures, Estonia’s largest venture capital investment firm. Monese’s $60M funding round was so-far the largest raise for the European fintech. One of the investors was Timeless Capital, the single family office of Karam Hinduja. The startup is working on a new funding round which would bring the valuation above £1BN.

Latest Valuation: n.a. (currently in talks for a new funding round, would bring valuation up to £1BN)
Latest Funding Round: £2.5M (Venture Round)
Investors: Seedcamp, Tera Ventures, Spring Capital, Kinnevik AB, YYX Capital
Family Office Investors: Timeless Media (Karam Hinduja Family Office)

2) Investment vehicles for family office investments in challenger banks

Interestingly, Europe’s challenger banks show a broad spectrum of family office investment vehicles and how they play a role. Actually, we just named a few family offices that act as leading investors. The real number of family offices that own in some way shares of Europe’s most important challenger banks probably is in the hundreds. Family offices are major fund sponsors of venture capital firms, which in turn act as investors. If single family office A commited 10% of the money of venture capital firm B’s fund C, which in turn owns a 10% stake in fintech D, single family office A owns indirectly 1% of fintech D. Furthermore, some challenger banks decided to raise money through crowdfunding platforms like Seedrs or Crowdcube. There, especially smaller family offices also have the chance to anonymously invest in the respective startups. In the following, we analyze the various investment vehicles.

Indirect investments through venture capital funds

Probably the most common way for family offices to engage in venture capital is through third-party funds. When relying on third party funds, family offices have a higher diversification in their startup portfolio and don’t need in-house expertise and access to relevant deals. Many of the world’s most renowned venture capital firms raise funds from major single family offices. To name a few important VC fundings: Passion Capital led Monzo’s £5M Series A (2016), Earlybird Capital led N26’s $2M Seed Round (2014), Balderton Capital led Revolut’s £6.8M Series A (2016). Exemplary later stage investments are Index Ventures who participated in Revolut’s $250M Series C (2018) or Insight Venture Partners who participated in N26’s $470M Series D (2019). Interestingly, only the UK early stage investor Seedcamp invested in two different challenger banks (in Revolut and Monese).

Direct investments

For some family offices with an own venture capital investment team or a background in the technology or financial space direct participations in challenger bank funding rounds can make sense. One interesting example is Daniel Aegerter’s single family office Armada Investment AG, which was an early backer of N26. Aegerter himself built up the financial technology company Tradex Technologies, which was acquired by Ariba for $5.6BN in 2000. Another example is the single family office Bahamas billionaire Harald McPike who is the main investor in Starling Bank.

Equity crowdfunding as novel investment vehicle

For challenger banks (and fintechs in general) the rather new funding form of equity crowdfunding has gained traction. Equity crowdfunding  means that startups raise funds from thousands of (often private) investors. Private investors can participate in the publicly available rounds amounts from low two-digit numbers on. Monzo raised £20M from 36,006 investors in under three hours on Crowdcube. In 2017, Revolut raised £3.8M on Seedrs at a £276M valuation. Compared to today’s $5.5BN, early investors almost achieved a 20X on their initial investment. Equity crowdfunding campaigns can be a win-win for challenger banks: additional funds are raised, PR is generated and strong promoters of the own brand (private investors who own a small part of the startup) are acquired. Also an increasing part of family offices start investing on platforms like Seedrs for multiple reasons: their investment stays anonymous, no deal-sourcing effort is necessary and also smaller participations are possible. Equity crowdfunding also enables smaller single family offices (without own venture capital teams) to invest in the up-and-coming challenger banks.

Jeff Lynn, co-founder and executive chairman of Seedrs, confirms the interest of family offices in early stage fundings through equity crowdfunding:

“We’ve seen a notable increase in appetite over the last few years from family offices to get into earlier stage businesses, but who don’t have the resources to execute such deals. With Seedrs, they can make use of our technology and nominee structure to build a diverse portfolio of early stage companies. Additionally, as this is relatively a new area for these investment vehicles, many aren’t well known enough yet in the market to receive the best dealflow, so they are using the platform to have access to some of the best startups that the UK and Europe have to offer. Examples of family offices we’ve worked alongside include Celeres, which invested £1.5 million into fintech startup JaJa in 2018, and more recently our portfolio company Oppo Ice Cream exited their Seedrs investors to HP Wild Holding AG, the family office behind Capri Sun.”

Metrics and KPIs for venture capital investments in fintechs and challenger banks

When VCs and family offices have the opportunity to invest in challenger banks, a few metrics are especially important. Earlybird’s speaker especially emphasizes:

  • Engagement rates of the user cohorts over time (i.e. Monthly Active Users) to determine how much value the banking offering creates in the eye of the customer.
  • Unit economics, especially comparing Customer Lifetime Value to Customer Acquisition Costs (CAC) to determine how much value is captured for the bank and at the same time as another indicator how much value is created for the customer – challenger banks achieve low CACs because customers quickly realize the superiority of their value proposition, thus switching their bank accounts.
  • Growth metrics and market share – determining overall competitiveness of the offering. However it is important to note that key competitors are incumbent banks and increasing market shares of other challenger banks are not a red flag but a sign of an ever growing opportunity to disrupt legacy providers.

3) Summary

As illustrated in this article, challenger banks belong to the most relevant investments in the fintech space. Hundreds of millions of euros are flowing in recent financing rounds, customer numbers are increasing drastically, the startups are already worth billions. Nevertheless, all the digital banks still burn more money than they earn. The next years will show where the journey is going: will the challenger banks manage to increase their valuations and reach the break-even zone, will a consolidation phase reach the challenger bank industry or will most of the new banks be acquired by traditional banks – or target an own IPO? Europe’s single family offices already have their skin in the game and pursue different investment strategies, from direct investments through third-party funds or even equity crowdfunding.

Once again, the speaker of Earlybird gave us an intersting outlook in the future of challenger banks:

  • We observe a growing verticalization and fragmentation. There are now neobanks, as well as neocards and neotraders for many customer segments and use cases. Examples for this are special accounts for children, accounts with a focus on sustainability or with a strong focus on special geographies, be it cities or whole continents, e.g. new neobanks in the emerging markets.
  • We see strong growth across all categories, with one category now especially coming-of-age: SME banking. Here we see both strong activity and an interesting trend of increased vertical integration of the entire financial stack into single category leaders, e.g. offering corporate credit and debit card solutions, expense management, working capital, credit scoring and so on besides mere account services.
  • On a macro level, one might argue that over the mid-term incumbents might spin out their own challenger banking products, yet this is hardly credible given the headstart the current generation of Neobanks has in terms of understanding the customer.  Alternatively, incumbents may buy their way into the challenger space, yet this may not match the truly global ambition of some of the Neobanks. Ultimately, our guess is that the market landscape will converge to a situation where challenger banks will have displaced incumbents.

Sources
Fintechfutures (Starling), 15.02.2020
Learnbonds (Starling), 13.02.2020
Techcrunch (Monzo), 15.02.2020
Independent (Monzo), 15.02.2020
Newswire (Monese), 15.02.2020
N26 (N26), 15.02.2020
RTE (N26), 15.02.2020
Wikipedia (N26), 15.02.2020
T3N (N26), 15.02.2020

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Companies and startups active in biotech and healthcare usually deal with medicine and pharma. Such companies typically need lots of capital to develop further, for example, for costly studies or complicated drug registrations. Therefore, the firms normally don’t generate any profits in the first years after their founding and are dependent on external investors. Single family offices play an ever-increasing role in providing the required capital to biotech and healthcare firms. Investments in such firms are hugely interesting for family offices because of the high profit margins that are typical in the healthcare industry. In the following article we want to introduce you five family offices, which are part of our top notch database of single family offices based in the U.S., that invest in biotech and healthcare.

#1: Raptor Group, Boston

The single family office of Jim Palotta, one of the most famous people from Boston, invests in many different kinds of industries. Palotta, the former Vice Chairman at Tudor Investment Corporation and owner of the Boston Celtics, made a name for himself as a prosperous investor. Raptor Group, also featured in our list of single family offices in Massachusetts, seeks to make early and seed investments in technology, consumer, sports & media and financial services companies, but one of its main pillars is clearly healthcare & biotech. A recent investment is “Genetesis”. The privately held medical technology company is oriented towards the development of efficient and non-invasive cardiac current density mapping. They developed a tool that non-invasively generates images of the heart’s electrical current distribution and characterizes deep sources of current that are consistently missed by the standard EKG.

#2: Schooner Capital, Boston

Schooner Capital, a typical American single family office, was founded and is led by Vin Ryan. He serves as a director of Iron Mountain, a $5 billion global records management company which he purchased and grew from a single storage site. He also served as a former director at Continental Cablevision and founded National Hydro and Arch Mobile Communications. Schooner Capital focuses on venture capital, growth equity and public securities investments where healthcare and biotech are two of their key industries. Their current portfolio includes “Remedy Plan Therapeutics”. The company develops small molecule therapeutics to halt tumor growth and disrupt the cancer stem cells that cause metastasis. They research non-toxic treatments that target the dangerous embryonic properties of cancer stem cells, which form the basis for cancer growth, spread, and resistance to chemotherapy.

#3: Tarsadia Investments, Newport Beach

Tarsadia Investments is a family office based in Newport Beach, which is also featured in our list of single family offices in California. They currently manage approximately $2 billion in family capital so they are able to invest across multiple stages of maturity and asset classes. Investments typically range from $5 million to $200 million per deal. The current portfolio includes investments in majority and minority stakes in privately-held companies, public equity and debt instruments and early stage venture-backed businesses. Their major target areas include healthcare as well as biotechnology. “Asana Biosciences” is one of the companies that are backed by Tarsadia Investments. Asana Biosciences is a research and development company specializing in the discovery and development of new chemical and biological entities. Its portfolio consists of multiple early-stage drug discovery and development candidates in a variety of therapeutic areas, including oncology, pain and inflammation, among others.

#4: Baruch Future Ventures, San Francisco

The single family office of Tom Baruch was founded in 2012. Tom is a well-known American business man and venture capitalist. For example, he was one of the founding partners of the famous venture capital funds CEMEA Capital and Formation 8. Baruch Future Ventures focuses on early and seed investments in companies that are active in resource scarce and climate sensitive markets. Target areas are clean energy, healthcare, food, agriculture and air quality but healthcare and biotech investments make up the largest part of Baruch Future Ventures’ current portfolio. One example is “BiomX”, a microbiome company developing customized phage therapies designed to target and destroy harmful bacteria in chronic diseases such as inflammatory bowel disease and colorectal cancer, as well as bacteria that affect the appearance of the skin.

#5: Pritzker Vlock Family Office, New Haven

The Pritzker Vlock Family Office (PVFO) is one of many single family offices that are connected to the Pritzker Family, one of the richest families in America, being near the top of Forbes magazine’s “America’s Richest Families” list since the magazine began listings in 1982. The family’s fortune arose in the 20th century, particularly through the founding and expansion of the Hyatt hotel corporation by Jay Pritzker. PVFO manages a diverse and international asset base that includes emerging biotech and medical device companies, consumer technology products, real estate and more. An exemplary biotech investment is “Gelesis”. The clinical stage biotechnology company develops first-in-class therapeutics to safely treat obese, overweight, and diabetic patients. The main product is Gelesis100, an orally- administered smart pill which contains thousands of hydrogel particles approximately the size of a grain of salt that expand to 100 times their dry weight. The pill is designed to act mechanically in the stomach and small intestine to increase satiety and decrease hunger, resulting in reduced caloric intake and weight loss.

Sources:
Picture:
Trust Katsande
Article:
raptorgroup.com (02/05/2020)
schoonercapital.com (02/05/2020)
tarsadia.com (02/05/2020)

 

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Global warming, climate change and Greta Thunberg: Right now there’s nothing more frequently addressed in daily newspapers than the world and its environmental degradation. The melting of polar ice caps and forest fires in Australia are only some of the side effects. To concern the global changes it is important to initiate a shift from traditional sources of energy to more environmentally friendly sources: renewable energies. Wind, wave and solar power are favorable sources of energy that do not harm our earth. In the recent past family offices also have recognized the importance of this topic and made investments regarding renewable energies. We want to provide you a short overview of five single family offices, that invest in companies or projects that focus on renewable energies. All of them are part of our massive database of more than 350 single family offices located in the United States.

#1: Capricorn Investment Group, New York

The family office, based in New York, serves as the personal investment arm of Jeff Skoll, who co-founded eBay and has an estimated net worth of almost 5 billion U.S. dollars today. Capricorn Investment Group seeks to deliver extraordinary investment results by leveraging market forces to scale solutions to global problems, such as global warming. Besides of renewable energy investments, the firm is active in real estate and proceeds almost all of its investments through funds. Their current portfolio includes the startup “Form Energy”. Form Energy is developing a new class of ultra low cost, long duration energy storage systems to make renewable energy available even when the sun sets, or the wind stops blowing. Form’s technology has the potential to transform the electric grid by making renewable energy dispatchable year-round.

#2: Zoma Capital, Denver

Zoma Capital is run by Lucy and Ben Walton, the grandson of Walmart founder Sam Walton. ZOMA Capital invests in a broad range of market-based sustainable solutions advancing energy, water, and regional economic resiliency in Chile and Colorado. Its global investment portfolio spans multiple asset classes and sectors with an emphasis on addressing environmental and social challenges. One recent investment in the fields of renewable energies is “AMP Solar Group”. The Group builds, owns and operates clean energy assets both behind and in front of the meter. Its solutions allow them to provide dispatchable, affordable and resilient clean power to enhance system reliability and security for customers and the grid.

#3: ARB Inc, West Conshohocken

The family office is based in West Conshohocken, Pennsylvania, and is led by Harry Halloran, CEO of the American Refining Group, who served at the board of The American Wind Energy Association. The relatively small investment company holds and manages a portfolio of operating wind assets as well as private company, private equity fund and project equity investments. The Halloran family invests in climate change driven sectors including renewable energy technologies and services, water technologies and services, waste to value, energy efficiency, biomass and biofuels, and sustainable agriculture. Current investments are, for example, “Cool Planet Energy Systems” and “Frontier Wind”. Cool Planet is developing a technology to convert non-food biomass into green fuels that are chemically identical to fossil fuels. Frontier Wind designs and sells technologies for modern utility scale wind turbines including proprietary wind speed sensing, bat avoidance and active load management.

#4: The Husseini Group, Beverly Hills

The group, located in Beverly Hills, serves as the personal single family office of Ibrahim AlHusseini, a serial entrepreneur and impact investor. He is dedicated to addressing the growing global waste crisis and is the founder and CEO of FullCycle. The family office invests in growth companies that embrace social enhancement and ecological sustainability. To date, AlHusseini has raised half a billion dollars in impact-focused capital. An exemplary investment is “Bloom Energy”. Bloom Energy offers on-site power generation systems that utilize an innovative new fuel cell technology with roots in NASA’s Mars program. Derived from a common sand-like powder, and leveraging breakthrough advances in materials science, this technology is able to produce clean, reliable, affordable power, practically anywhere, from a wide range of renewable or traditional fuels.

#5: Keller Enterprises, Charlottesville

Keller Enterprises, another small single family office based in Charlottesville, Virginia, was founded by Caroline “Polly” Keller in 1998. She had the vision that it could be a company cooperatively, imaginatively and productively run by subsequent generations of the Keller Family. The firm combines venture investing, venture philanthropy and venture farming and operates the “Inglewood Farm” in Central Louisiana. Keller Enterprises’ investments focus mainly on energy, agriculture and real estate. One major investment is “Apex Clean Energy”. With its diversified portfolio of wind energy facilities in development around the country and its solar PV assets, the company has become one of the fastest-growing companies in the industry since its founding in 2009. The company’s management team comprises experts from throughout the industry whose collective prior experience includes the development, financing, construction and operation of over $10 billion in wind and solar energy facilities now operating in the United States.

Sources:
Picture:
American Public Power Association
Blog:
capricornllc.com (05/24/2020)
zomalab.com (05/24/2020)
kellerllc.com (05/24/2020)

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Los Angeles as the second largest city in the US is home to many top-notch single family offices

With our exclusive database of the largest US single family offices we claim to cover all relevant investment companies of the super rich. Of course, Los Angeles plays a particularly important role here. The economy of California’s largest city has shaped the economic growth of the United States for decades. Many of the richest American families originate from the region and have also established their family offices here. To give you a first impression of the Family Office scene in LA, we have created a map of the SFOs located there. In this article we would like to give you some insights into the map and the Single Family Offices behind it.

Most of the LA-based single family offices are located in Beverly Hills, Newport Beach, Irvine and Santa Monica

Our list of the largest single family offices in California is a part of our comprehensive American database. In a separate article we already present the map of all Californian SFOs. It became clear that LA is an absolute hotspot for family offices. Now we can take a closer look at the distribution of single family offices in Los Angeles. It shows that various regional clusters have been formed. These are located in particular in Beverly Hills and Santa Monica as well as in Newport Beach and Irvine. There are also a few relevant single family offices in downtown LA and Manhattan Beach.

Main focus of Los Angeles single family offices is on real estate and private equity investments

Interestingly, our research on the most important family offices in the USA revealed regional clusters by investment focus. For example, a particularly large number of SFOs from New York are active in the capital market, while most family offices in Silicon Valley act as venture capital investors. For the Single Family Offices in LA, this only applies to a limited extent. The variety of family offices from Los Angeles and the surrounding area is very large. However, it is noticeable that most of the investment companies based in LA invest in real estate and make private equity investments. You can of course find more details in our database.

Map created with Batchgeo

Always stay up-to-date in the single family office landscape

In case you are interested in the most relevant family office news, we highly recommend you the following two-steps:

  • Sign up for our newsletter hereWe publish a monthly newsletter of the most relevant single family office news. The newsletter includes newly founded family offices, family office investments and reports about industry trends.
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During the long-lasting research for our list of single family offices in the United States it became clear, that there are many important single family offices who are settling down in Chicago. The City of Chicago is located in in the state of Illinois directly on the shores of freshwater Lake Michigan and counts as the third most populous city in the United States, which is quite impressive if you think about the Great Fire of Chicago in 1871 that almost destroyed the whole city. Today Chicago is an international hub for finance, culture, commerce, industry, education, technology, telecommunications, and transportation. So it is not super surprising that you have a strong and fast growing start up scene there, which is very attractive to many venture capitalists and single family offices. In the following we want to introduce you three important single family offices that are located in Chicago as part of our top-notch list of single family offices in the United States.

#1 Grand Crossing Capital – Family Office Focused on Private Equity Investments in Branded Consumer and Retail Businesses

The Illinois based single family office has made its mission to support consumer and retail businesses with private equity investments helping them to establish strong recognized brands. Therefore Grand Crossing Capital provides growth capital in the range of 5 million U.S. dollars to 25 million U.S. dollars and takes positions in both minority and control situations. The investment firm was formed as a cooperation between experienced consumer-focused private equity professionals and the family that grew the “Wilton Brands”, a branded consumer products business with revenues of 450 million U.S. dollars before its sale in 2007. To be considered as a potential investment by Grand Crossing Capital your business should be a branded consumer or retail business located in the United States with at least an EBITDA of 2 million U.S. dollars. One of their current portfolio companies is “Everglades”. The manufacturer of premium offshore fishing boats was founded in 1997 and is known for its innovative approach to boat building and has established a “cult-like” following among its customers.

#2 Duchossois Capital Management – Single Family Office Investing in Industrial Engineering, Logistics, Consumer, Healthcare and Real Estate

The private investment office manages the assets of the Duchossois Family, who mainly generated their fortune due to the economic activities of the Duchossois Group which was founded in 1983 by Richard L. “Dick” Duchossois. Richard worked for the Thrall Car Manufacturing Company and became CEO in 1952. The firm bought the Chamberlain Manufacturing Corp in 1980 where Richard served as a chairman. In 1983 Richard and his family bought all the interest stakes from the Thrall Family and renamed their company to Duchossois Industries Inc., which later was renamed to Duchossois Group. Duchossois Capital Management was founded in 2013 to manage the fast growing fortunes of the family. The investment firm focuses on private equity and real estate investments but also does invest in funds and public securities. Realizing real estate investments Duchossois Capital Management seeks to partner with experienced real estate investors and operators that focus on office, industrial, residential, commercial real estate objects with investment sizes from 10 million U.S. dollars to 30 million U.S. dollars. When considering private equity transactions, the company relies on businesses active in the fields of industrial engineering, logistics, consumer and healthcare. “Rensa Filtration” is one of the companies in their current portfolio that designs and manufactures air filtration products and services for commercial and industrial applications.

#3 Schwartz Capital Group – Investment Office of Schwartz Family investing in Venture Capital and Multi-Family Real Estate

Schwartz Capital Group was founded in 1996 by Ted Schwartz, who is an award-winning industry pioneer with over 35 years of experience in leading one of the preeminent global outsourced services and solutions businesses in the industry. He founded “APAC Customer Services” and “Expert Global Solutions (EGS)”. Schwartz Capital Group completes real estate investments (mainly multi-family objects) as well as private equity and venture capital investments. When realizing venture capital or private equity transaction Schwartz Capital Group does only use the capital of their so called “Strand Equity” fund which is dedicated to providing growth capital for emerging and dynamic consumer brands. “OppLoans” counts to their current portfolio and is a leading online consumer lender and financial inclusion business. It’s one of the highest-rated online lenders in the country and is known for its exceptional customer service and for both safe and affordable online lending.

Credits:
Picture:
Lance Anderson

Blog:
grandcrossing.com (12/19/2019)
dcmllc.com (12/19/2019)
schwartzcap.com (12/19/2019)

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Always stay up-to-date in the single family office landscape

In case you are interested in the most relevant family office news, we highly recommend you the following two-steps:

  • Sign up for our newsletter hereWe publish a monthly newsletter of the most relevant single family office news. The newsletter includes newly founded family offices, family office investments and reports about industry trends.
  • Follow us on LinkedIn. Be the first to get-to-know relevant single family office news directly through your LinkedIn newsfeed.

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San Francisco Bay Area: One of the most important economic regions in the US and home to top-notch Single Family Offices

No country is home to as many single family offices as the United States. Our research on our comprehensive database of the most important American SFOs has shown that most family offices are located in major economic centers. This also applies to the San Francisco Bay Area, which has been growing steadily for years and has produced high-net-worth individuals and families. We have created a map for you showing the single family offices in the region. These family offices also include investment companies associated with the world’s most prominent entrepreneurs. Detailed information can be found in our list of the largest single family offices in California or in our US-wide database.

Single Family Offices in the Silicon Valley: From Cupertino to Palo Alto, Mountain View, Menlo Park and Redwood City

A large part of the most important technological innovations of recent years and decades originate in Silicon Valley. Companies such as Google, Facebook and Apple are based in the Bay Area and attract many highly qualified employees, who in turn contribute to economic growth in the region. In this environment, highly successful companies are founded, grown and sold. The wealth that entrepreneurs have accumulated in this way is managed by particularly wealthy people in their own family offices. It is therefore not surprising that Silicon Valley is a hotspot in the American single family office world. With our database of the most important US family offices, you can find out which investment companies are behind the pins on the map.

San José, Oakland, Berkeley and Fremont rather insignificant for the Bay Area’s investment scene

The most populous city in the San Francisco Bay Area is San José. However, this is not reflected in the Family Office landscape, as the map shows. No relevant single family office could be identified directly in San José. The density of SFOs is also very low in other larger cities of the region. This applies equally to Oakland, Berkeley and Fremont. The strong economy in San Francisco and Silicon Valley seems to have a strong attraction that cities in the surrounding area do not have.

Map created with Batchgeo

Always stay up-to-date in the single family office landscape

In case you are interested in the most relevant family office news, we highly recommend you the following two-steps:

  • Sign up for our newsletter hereWe publish a monthly newsletter of the most relevant single family office news. The newsletter includes newly founded family offices, family office investments and reports about industry trends.
  • Follow us on LinkedIn. Be the first to get-to-know relevant single family office news directly through your LinkedIn newsfeed.

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