Insights from The 2019 Family Wealth Alliance WealthTech Symposium Part 3: How To Remain Relevant in a Rapidly Changing Family Office Space
At The 2019 Family Wealth Alliance WealthTech Symposium, I was asked to provide my insights on the future of WealthTech and ten years of experience using advanced technology that enhances the human touch of professional family office services. This is part two of our three-week series sharing our perspective on the questions posed at the event. If you missed part one or two, you can find it here
What are the most important considerations today for family office firms trying to stay relevant in this next evolution of the FinTech Industry? If they blink, what might they miss?
I think Chicago’s history serves as a bit of inspiration for this question. The Great Chicago Fire was a time of great loss, but also great innovation. After the fire, the city led the country in development standards favoring brick over frame and setting new fire safety standards. The fire forced the city to improve its infrastructure.
For family offices, the danger of not recognizing the impact of outdated infrastructure is significant. There’s no indication that the volume of information we manage is decreasing. Requiring professionals to shift their attention from one disparate system to another negatively impacts strategic focus and productivity. With these complications in mind, it is easier to understand the results of national studies which indicate that 30-40% of our workday is spent looking for information. Even at 20%, with overhead costs of $500MM, an office would be spending $100,000 per year to overcome technology complications and find information.
Over the last ten years, our multi-family office has experienced the powerful benefits of using a blockchain operational infrastructure to change these negative outcomes. The ability of Senior Advisors to do something in 30 minutes which previously took 16 hours is the direct result of having the necessary infrastructure around the relevant facts to materialize knowledge and efficiency.
Experienced firms today have the right teams and resources to manage client wealth. They also have the opportunity to take advantage of the current increased demand for family office services and reconstruct their technology infrastructure for explosive growth. As General Eric Shinseki said, “change is hard, but irrelevance is worse.” Change is happening faster than you might think. If you blink, you might miss the opportunity.