Multi-family offices are more educated on the secondaries market, although single-family offices are increasingly becoming interested, says François Gamblin, chief executive officer of SecondCap, which manages online secondaries platform SecondaryNet.
What type of secondaries buyer uses SecondaryNet the most?
The SecondaryNet platform has 420 registered buyers. The majority of the buyers are fund of funds and institutional investors, followed by secondaries specialists. Family offices make up 8 percent of the buyers, although I expect that to increase once more family offices understand better the secondaries market.
How would you describe family offices’ attitudes toward the secondaries market?
Family offices are very opportunistic and very pragmatic – the way they look at it is a marketplace exists if they need it. However, it’s important to segment the family office universe into two categories: multi-family offices and single-family offices. The former are very professional and have adequate internal resources to understand the market. They tend to be fully aware of how the market works. On the other hand, single-family offices aren’t as educated. I’ve had meetings with these types of investors that have invested in private equity but have rarely never heard of secondaries.
What approach does SecondaryNet take toward working with family offices?
I believe we’ll be successful with this universe of investors that don’t know how to proceed. We’re currently working with a family office organisation in Italy and we would like to increase our presence in this market globally. The size of the deals we’re working on is also suitable for family offices. They are mostly small and medium transactions less than $100 million. Our sweet spot is between $5 million and $50 million.