When a Bank is no longer enough: How Family Offices emerged

The concept of a family office arose from a simple need: as a family’s wealth becomes more complex, individual financial services are no longer enough. What is needed is a person or a team that can see the bigger picture and help make long-term decisions.

What is a Family Office?

A family office is a structure that helps coordinate the management of a family’s wealth and related matters. This may include investments, risk management, tax and legal matters, succession planning, and preparing for the needs of future generations.

Unlike working with several separate service providers, the purpose of a family office is to bring these different areas together under a unified, long-term strategy.

From the Morgans to the Rockefellers

The origins of the modern family office date back to the 19th-century United States, a period of rapid industrial growth and increasing wealth among business owners. Families that had accumulated substantial fortunes needed to manage not only their businesses but also personal investments, inheritance, and philanthropic activities.

One part of this history is associated with the financial activities of the Morgan family. However, the Rockefeller family became a particularly significant example in the development of the modern family office.

In 1882, John D. Rockefeller established an office in New York to oversee his family’s investments, personal affairs, and philanthropic interests. This allowed different matters to be coordinated in one place rather than managed separately.

This model became an important milestone in the evolution of the modern family office. Over time, the scope of family offices expanded: alongside investment management, increasing attention was given to wealth continuity, family governance, and the transfer of wealth to future generations.

One family or several?

Today, two main types of family offices are commonly distinguished.

Single-family office – established to serve the needs of one family. The family has its own dedicated structure and can determine which areas of expertise are needed, how operations should be organised, and what long-term objectives to pursue.

Multi-family office – provides services to several families. These families share access to a team of professionals and a common infrastructure, eliminating the need for each family to establish a separate organisation.

There is no single model that suits every family. The choice depends on the size and complexity of the family’s wealth, its specific needs, the desired level of involvement, and the extent to which different functions should be coordinated under one structure.

What challenges does a Family Office help address?

As a family’s wealth grows, so does the number of professionals involved in managing it. Some focus on investments, others on real estate, legal matters, or taxation. New challenges also arise: how to prepare for the transfer of wealth, how to align the interests of different family members, and how to ensure that today’s decisions remain consistent with long-term objectives.

The role of a family office is to help address these matters as part of a broader picture. For example:

• Investments and risk. How do different assets complement one another and align with the family’s objectives?
• Wealth transfer. How can a family prepare in advance for the transfer of wealth and responsibilities to the next generation?
• Family agreements. How can decisions be made when family members have different interests or perspectives?
• Long-term direction. How can individual decisions support the family’s shared long-term goals?

This does not necessarily mean that a single team performs every function. Often, what matters most is ensuring that different specialists work in a coordinated manner and that the family has a comprehensive overview of its wealth.

Family Offices in Lithuania

In Lithuania, traditions of managing wealth across multiple generations are still developing. For families that have accumulated significant wealth through business activities or investments, questions increasingly extend beyond wealth growth to its management, continuity, and transfer to future generations.

INVL Family Office has been working in the field of family wealth management since 2015. Its activities reflect the fundamental idea behind a family office: helping families look beyond individual assets to understand their overall wealth position and maintain a long-term perspective.

Because as a family’s wealth grows, what matters is not only who manages each individual asset. Equally important is having someone who can help connect today’s decisions with what the family wishes to preserve for future generations.