Family Offices May Find Advantages in the Cloud

With the COVID-19 pandemic requiring employees of most non-essential businesses to work from home (WFH), family offices will want to consider migrating their investment data to the cloud like hedge funds did following the 2008 global financial crisis. Through leveraging cloud technology and having everything in one centralized place, not only can the data be reconciled quickly but wealth managers can receive near real-time view of all their investments to make smart investment decisions to preserve the entirety of the family enterprise.

John Delalio, managing director of EisnerAmper’s Cloud Accounting Services Group, which is part of the firm’s Outsourced Finance and Accounting practice, said family offices who store their investment data in the cloud can streamline their operations in a cost-effective manner because technology makes data capture and reconciliation more efficient, easing the burden of manual data entry. Further, it will enable employees and family members of the enterprise to better spend their time analyzing data and returns to make educated decisions for the family enterprise including trust and estate planning, philanthropy and more. 

“Family offices, whether a single-family office or multi-family enterprise, have a lots of different investments, including equities, fixed-income, hedge funds, real estate and more. During the COVID-19 pandemic, given how fast-moving these investments have been, it can be extremely challenging for everyone who monitors them to find one centralized place to see how they are doing,” he said. “Through migrating their investment data to the cloud, investment professionals at the respective family offices can make more informed investment decisions on behalf of all family members. At the same time, having everything in the cloud also helps automate some of their operational processes such as bill pay and more.”

Delalio also added that migrating to the cloud eliminates the need for family offices to rely on both outdated spreadsheets and waiting a month for their underlying investment managers to input their returns and other information, hence taking time away from analyzing the data to make informed investment decisions in the best interest of the family legacy.

“The cloud is about bridging the gap between personal wealth and fund wealth and seeing it all in one place without distracting teams focused on single elements of the business,” he said.   “When family offices migrate their data to the cloud, they have access to it nearly real-time.”