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Family Office Compliance Policies and Record Keeping with David Guin

David is a partner in the corporate team at Withers Bergman.

He leads the corporate practice teams in the US. He integrates the knowledge he has gained in representing public companies, fund managers, and investment advisers with his experience in representing family and closely-held enterprises and entrepreneurs.

David has extensive experience advising clients on a range of issues governed by the US Securities Laws and other regulatory matters such as the rules of various self-regulatory organizations.


He devotes a significant amount of time to advising high net worth domestic and international individuals, families, family offices, and their advisors about their obligations under US securities laws, including the acquisition and disposition of public and private securities, beneficial ownership reporting obligations, and the applicability of the US Investment Advisers Act and US Investment Company Act to their investment activities.

David represents hedge funds and investment partnerships with respect to fund formation matters, preparation of fund formation and offering documents, transaction structuring, and compliance issues.


He has represented numerous companies in the acquisition and disposition of businesses and business segments and all types of public and private financing transactions.


David also acts as general counsel to many of his clients, advising on governance and fiduciary matters and a wide range of commercial transactions from employment matters to intellectual property licensing.


David is a Member of the Board of Trustees and Counsel to the Museum of the City of New York.

Kirby : Welcome to the Tamarind Learning Podcast, I'm your host Kirby Rosplock. And today we have David Guin Attorney at Withers, who is a compliance expert.  And we're thrilled to talk to him more about how family offices are complying and this New Day and Age, David, welcome to the podcast.

David:
Thanks Kirby. Great to be here.

Kirby: David, can you tell us a little more about what regulations are currently affecting family offices, and how they're managing those regulations?

David: Sure. So, the questions we get asked most frequently by clients are questions dealing with their qualification under the family office exemption. So, do I get to skip being registered as an investment advisor? Questions about beneficial ownership reporting? So, when, when do I have to disclose to the public my ownership interest in securities.  Then, we have questions about privacy and, just, overall recordkeeping requirements.

Kirby: And if we go dig, dig deeper a little bit here, can you also just share with people listening in, what are the requirements for the family office exemption?

David: So, there's two overarching requirements. One is that the family office needs to be owned and controlled by the family, and, secondly, the family office can only serve an investment advisory capacity anyway, entities and individuals that qualify as family clients. So, one of the questions we get asked about frequently, for example, is, I want to do some type of no recordkeeping reporting, performance reporting for a non family member. Can I do that? Of course, you can't. Because doing that type of, I like to say math is not a regulated activity. Computer simply crunching numbers for people, that isn't a regulated activity. You can provide that for anyone. So we get a fair amount of questions about what type of service can I provide, and who can I provide it to? We also still get a fair number of questions about who is or is not a family client.

02:18 - 02:33
Guin, David

So, you know, as people's families change, whether or not someone qualifies as a family client, we got an interesting one, not too long ago, our client called, and in their case, they had a former family member.


02:33 - 02:40
Guin, David

So, a former spouse, and they were asking whether the children of the former spouse.

02:40 - 02:41
Kirby Rosplock

Or.

02:41 - 02:42
Guin, David

Family clients?

02:42 - 02:46
Guin, David

And interestingly, it depends on when those children were born.

02:46 - 02:54
Guin, David

So, if they were born, during the time that the former spouse was a spouse of a family member, then they do qualify.

02:55 - 02:57
Guin, David

If they were born after that time, they don't qualify.

02:58 - 03:05
Guin, David

And, I guess, I'm not really sure that's where the SEC intended that, to end up, But that's, if you look at the rules, that's where it ends up.

03:05 - 03:12
Guin, David

So, there's still interpretation questions that are coming up, that that aren't specifically dealt with in the rules.

03:14 - 03:15
Kirby Rosplock

That's really interesting.

03:15 - 03:23
Kirby Rosplock

I mean, it is very complicated when you think about that level of ownership and offspring, as it relates to who's a family client?

03:23 - 03:33
Kirby Rosplock

Are there any exceptions, any unusual exceptions to the flat family client definition that might end up being allowed if they're not family?

03:34 - 03:40
Guin, David

Yeah, so, there's an ongoing question about the extent to which in-laws will be allowed.

03:41 - 03:46
Guin, David

So, there was a, there was some lobbying going on for a while to add in-laws.

03:46 - 03:57
Guin, David

So let's say that it's your family office, your husband is a family client because he's married to you, but your brother-in-law isn't in the same lineal change.

03:57 - 04:00
Guin, David

So you couldn't offer services to your brother-in-law.

04:01 - 04:17
Guin, David

There was some lobbing going on to try and get in-laws included that didn't come to fruition, but there are some no action letters out there asking for specific relief based on a specific set of facts and circumstances.

04:17 - 04:20
Guin, David

So there may be some movement in in that regard.

04:22 - 04:27
Guin, David

If the other part about the family AFS exemption is the ownership and control requirements.

04:29 - 04:35
Guin, David

And, when we say a family office has to be owned by family entities, that's the technical term under the rule.

04:36 - 04:39
Guin, David

It's important, remember, that can include key employees.

04:39 - 04:49
Guin, David

So, you can have a key employee that owns a piece of the family office or owns, you know, part of an investment vehicle that the family office advises.

04:50 - 04:53
Guin, David

But, those people cannot control the family office.

04:53 - 04:55
Guin, David

The family members need to control.

04:56 - 05:02
Guin, David

In the FAQs, it came out shortly after the rule really focused on the board of directors.

05:03 - 05:14
Guin, David

So, we were, we originally were always selling people, you know, at least a majority of the Board of Directors, or a similar governing body, like board of managers, if it's an LLC, need to be family members.

05:14 - 05:21
Guin, David

We've become a little bit more comfortable, in some cases, with moving those types of controls to the ownership level.

05:22 - 05:35
Guin, David

So, we might not have a Board of Directors that, yeah, it is, consist primarily of family members, but we may have taken a lot of the rights that would normally be exercised by the Board of Directors and move them back to the ownership level.


05:36 - 05:43
Guin, David

There are, you know, various planning techniques where you don't really want family members to be in control of an entity, like a board of directors.

05:43 - 05:44
Guin, David

So.

05:45 - 06:07
Kirby Rosplock

Well, and I think that's a really interesting area to delve a little bit more deeply into, I mean, you talked about recordkeeping as being a really important practice as part of compliance, and tell us more on how you see recordkeeping meringue to write demonstrating control, especially in this circumstance.

06:08 - 06:16
Guin, David

So, it's a great question because we know, hey, I like to approach these things as if the documents on drafting are an exhibit.

06:16 - 06:33
Guin, David

So, you know, when we create a been LLC agreement for a family office, for example, we, we draft into the document itself the requirements as to ownership and control so that it's a requirement for the entity to meet those standards.

06:33 - 06:38
Guin, David

Not just that it happens to be, that you meet them, but the document itself requires you to.

06:38 - 06:45
Guin, David

So we might say, for example, you know, you have to have, a board of directors must consist of a majority of family members.

06:45 - 06:52
Guin, David

Or, if they're an even number of family members and non family members, a family family member must have a casting vote.


06:53 - 06:56
Guin, David

So it's baked right into the terms of the agreement itself.

06:57 - 07:00
Guin, David

In that way, they're talking on the door, it's easy for you to show them.

07:00 - 07:03
Guin, David

Of course, I can apply my documents, require me to comply.

07:04 - 07:20
Kirby Rosplock

And you were telling me earlier about some new influences that our current state, and, particularly, virtual family offices, David can you talk to us a little bit about compliance policies, and what is new in the family office space.

07:21 - 07:25
Guin, David

So, you know, a lot of family offices may start with a general observation about compliance policies.

07:25 - 07:35
Guin, David

Lot of family offices, don't think they need compliance policies, because they're not subject to it regulatory compliance regime.

07:36 - 07:38
Guin, David

I think that's sort of missing the point.

07:38 - 07:44
Guin, David

I mean, the family needs to decide what's important to them, and then they need to draft compliance policies to deal with that.

07:45 - 07:50
Guin, David

So, for example, one of the things we spent a lot of time on, and many families are concerned about their privacy.

07:52 - 08:00
Guin, David

So, we will draft compliance policies about who must sign off on disclosures in a subscription agreement.

08:01 - 08:12
Guin, David

Because we don't know, we don't want someone who doesn't understand the family's desire not to disclose fact X, Y, or Z to the world at large filling out subscription documents without having somebody check them.

08:12 - 08:15
Guin, David

So, we want the compliance policies too.

08:16 - 08:19
Guin, David

It'd be tailored to what the family is concerned about.

08:20 - 08:24
Guin, David

You know, we have a lot of compliance policies as well, about who has the ability to move money.

08:26 - 08:31
Guin, David

No, it's, it's just, it's good common sense to have checks and balances in place.

08:31 - 08:44
Guin, David

You know, I'm sure everyone trusts their employees but you don't want to put anyone in a position that, you know and puts them in a place where they could, could benefit from some wrongdoing putting compliance policies in place.

08:44 - 08:45
Guin, David

That avoid that.

08:45 - 08:49
Guin, David

You know, as we've gone into the covert 19 World.



08:49 - 08:51
Guin, David

This was already happening to some extent but it's happening even more.

08:51 - 08:51
Guin, David

Now.

08:53 - 09:00
Guin, David

Haven’t compliance policies that deal with both the virtual world and multiple locations is.

09:00 - 09:00
Kirby Rosplock

Really.

09:00 - 09:01
Guin, David

Important.

09:01 - 09:04
Guin, David

So, figuring out how are you going to deal with those things.

09:05 - 09:15
Guin, David

And, you know, requiring, for example, that, you know, all documents must be stored in a, no accessible, electronic location.

09:16 - 09:21
Guin, David

The virtual world is always, we're making electronic recordkeeping much more important.

09:22 - 09:26
Kirby Rosplock

I think those are all really important areas.

09:26 - 09:36
Kirby Rosplock

I mean, do you want to talk a little bit more about why privacy is oftentimes an issue potentially for compliance and compliance and a family office?
09:36 - 09:41
Kirby Rosplock

And why families obviously want to not have as much information out there to the general public?

09:42 - 09:46
Guin, David

Yes, I think it's really to two main drivers of the privacy concerns.

09:46 - 09:54
Guin, David

One is a desire not to disclose too much information about the wealth holding structures.

09:55 - 10:03
Guin, David

So, you know, a lot of these beneficial ownership reports, for example, require you to go up the chain.

10:04 - 10:06
Guin, David

Getting to an alternate beneficial owner.

10:07 - 10:22
Guin, David

So, for families who have a concern about disclosing that level of information noted to whoever it may be that they're being or they have an off shore structure, and they don't want, you know, their home government, too, to understand exactly how their holdings structure works.

10:23 - 10:36
Guin, David

Or it could be a creditor issue, but we'll come up with specific structuring and reporting ideas that are designed to protect that type of information.

10:36 - 10:45
Guin, David

So, now we'll create a structure that allows us to stop at some point, going up the chain, before we get to the OTAs, the very top, but still comply with the rules.

10:45 - 10:54
Guin, David

So, there's that concern, and then, as you would suspect, there's also a concern about people just not wanting the general public to know what they own and how much they're worth.

10:55 - 11:11
Guin, David

So, we do a fair amount of work with an institutional investment manager, filing Richard Card 13 F, and there's the ability to claim a personal holding exemption.

11:12 - 11:24
Guin, David

So, if the filing would disclose the ownership of securities by a natural person, a trust or an estate, you can claim confidential treatment for actual securities.

11:25 - 11:29
Guin, David

And an interesting way in which the Family Office rule has affected other things.

11:30 - 11:51
Guin, David

We have been successful, for example, in getting the SEC staff to agree to expand the personal holding exemption by saying, well, if it, you know, if this file would identify the ownership by a group of identifiable people, natural persons, or trusts, then you should afford the same type of.

11:51 - 11:55
Guin, David

You know, confidential treatment to that information, as you would if it were a single individual.


11:55 - 12:07
Guin, David

So, we've, we've been filing on behalf of family offices, saying, you know, they are holdings as a whole because it's identifiable to a family, Should be afforded confidential treatment.

12:08 - 12:12
Guin, David

You, you get into some, some interesting questions about interpretation there, as well.

12:12 - 12:26
Guin, David

Because, a lot of times the question, whether foundation would, you know, knock you out of the ability to claim, because that's not among the types of entities that were listed in a in a personal holding exemption.

12:26 - 12:30
Guin, David

So, we have to deal with that sometimes and to deal with that question.

12:31 - 12:38
Kirby Rosplock

So, for the family office that doesn't have a Chief Compliance Officer, what advice?

12:38 - 12:47
Kirby Rosplock

What wisdom would you share about compliance in your office and in the merits of, you know, maybe working with an outside person in compliance?

12:47 - 12:53
Guin, David

Yeah, I mean, even if you don't have someone who's designated as a, as a chief compliance officer, and I would say, probably most family offices don't.

12:54 - 12:57
Guin, David

You should came in, At least no one who has that title.

12:58 - 13:03
Guin, David

You know, you should make it clear who in the organization holds responsibility for different things.

13:04 - 13:16
Guin, David

You Know, I do think it's probably in a family office best interest to work with an advisor, whether it be a lawyer or compliance consultant, to come up with a policy.

13:16 - 13:23
Guin, David

Um, you know, again, you need to build a bit careful because you don't want a policy that's overly burdensome.

13:24 - 13:32
Guin, David

You know, You wouldn't want to go, for example, and take a compliance policy for a fund manager off the shelf, and say, Well, this is, this is for me.

13:32 - 13:39
Guin, David

It's just going to contain a lot of stuff that isn't relevant family offices, And frankly, won't include some of the things that are relevant.

13:39 - 13:48
Guin, David

So, you know, it's not going to include the same type of concern about privacy, as you would want to have in a family office compliance policy.

13:50 - 13:53
Kirby Rosplock

This has been incredibly helpful, David.

13:53 - 13:58
Kirby Rosplock

Thank you so much for being here today as our featured guests on the Tamarind Learning Podcast, is your post Kirby Rossbach.

13:59 - 14:08
Kirby Rosplock

It's been another extremely helpful and relevant topic here, Family Office and compliance, we're really appreciative.

14:08 - 14:13
Kirby Rosplock

David was the author of Chapter seven of the Complete Family Office Handbook.

14:13 - 14:19
Kirby Rosplock

And we look forward to reading more about how to keep your family office compliant and the student age.

14:19 - 14:22
Kirby Rosplock

Thanks again David, pleasure that in there.

14:22 - 14:22
Kirby Rosplock

Thank.

14:22 - 14:23
Guin, David

You, Kirby.

14:25 - 14:27
Kirby Rosplock

This conference will now be recorded.



Withers – Bill Kambas and Ivan Sacks
14:29 - 14:31
Kirby Rosplock

Welcome to the Tamarind Learning Podcast.

14:31 - 14:33
Kirby Rosplock

I'm your host Kirby Rosplock.

14:33 - 14:40
Kirby Rosplock

And I'm pleased to have Ivan Sachs and Bill Kambas with me today from WithersWorldwide.

14:40 - 14:51
Kirby Rosplock

They are leading attorneys and co-authors, Chapter five of the Complete Family Office Handbook and focused on family office setup structure and operations.

14:51 - 14:53
Kirby Rosplock

We're thrilled to have you both here today.

14:53 - 14:54
Ivan Sachs

Thanks so much.

14:54 - 14:55
Bill Kambas

Thank you.

14:56 - 14:56
Kirby Rosplock

Good to be here.

14:57 - 15:05
Kirby Rosplock

So we're really excited to dig into the topic today of how do you pay for, structure and own a family office?

15:05 - 15:12
Bill Kambas

And, you know, paying for an office is one of those, you know, situations that you have to think long.

15:12 - 15:14
Bill Kambas

And think hard about, What are you creating?

15:14 - 15:15
Bill Kambas

How are you going to fund it?

15:16 - 15:19
Bill Kambas

Not just for today and tomorrow, but for decades to come.

15:19 - 15:33
Kirby Rosplock

And I'd love to dig in, just stepping into the pool of family office right now to talk about how do families typically set up and think about how to pay for the family office structure?

15:33 - 15:34
Kirby Rosplock

Bill?

15:35 - 15:36
Bill Kambas

Sure, thank you, Kirby.

15:37 - 15:55
Bill Kambas

And that's a very timely question as we have volatility in the market internationally and you know, families who is nothing new to the, are thinking about succession planning and the safeguarding and good stewardship of their assets.

15:55 - 16:03
Bill Kambas

So a family office is not an essential part, but it often plays a very important role in that family enterprise.

16:04 - 16:08
Kirby Rosplock

So the first way and you divide it up really nicely intentionally.


16:08 - 16:16
Kirby Rosplock

Or unintentionally, which is to divide up, setting it up and paying for it separately because I think you really have to take it in stride.


16:17 - 16:23
Kirby Rosplock

The question, the first question, is: Is this appropriate: what is the most appropriate arrangement for a family?


16:24 - 16:34
Kirby Rosplock

And, from there, we ended up, we can evaluate different opportunities for cash flow that would lead to the sustainability of the office within the overall enterprise.


16:35 - 16:47
Kirby Rosplock

Ideally, you do it in a way that is the least economically disruptive to the overall enterprise, and ideally, even furthermore, in a way that is a net benefit to the overall enterprise.


16:49 - 16:59
Kirby Rosplock

There are certain activities that need to be undertaken, and many of those activities require the participation of individuals who will get paid for that.


17:00 - 17:12
Kirby Rosplock

There are lots of different ways of dividing that up, and that's ultimately how we were back into, and work around, the payments, and funding aspect of running a family office.


17:12 - 17:14
Kirby Rosplock

So often, it wouldn't starting with that.


17:14 - 17:17
Kirby Rosplock

Is this the right thing for a family?


17:17 - 17:18
Kirby Rosplock

There's a driver.


17:18 - 17:27
Kirby Rosplock

There is somebody, or some constituent group of people in the family enterprise who will be encouraging the exploration of the family office.


17:28 - 17:32
Kirby Rosplock

Those are usually the folks who want to make the initial investment.


17:32 - 17:41
Kirby Rosplock

Many times it may be first as a senior generation, who is recognizing all the work that they have been doing, and say we need to professionalize this.


17:41 - 17:52
Kirby Rosplock

But it may also be a group of fiduciary trustees who say that they, themselves, as individuals, or a private trust company, is not best equipped to handle a certain set of tasks.


17:52 - 17:55
Kirby Rosplock

And they want a family office to actually be doing that.


17:56 - 18:06
Kirby Rosplock

It may be beneficiaries of trusts who want this service because of organizing just the various demands of being good stewards.


18:06 - 18:10
Kirby Rosplock

I mean, there's, there's quite a long list, which we won't go through right now.


18:11 - 18:24
Kirby Rosplock

But whichever group it is, or whichever individuals they are that want to have that discussion will often be the ones who invest in the time as well as the economic cost of setting up that family office.


18:24 - 18:29
Kirby Rosplock

And from there, we then move to what sort of strategies may allow it to be self sustaining.


18:30 - 18:39
Kirby Rosplock

So, I'm just really curious, is paying for and being the owner of the same thing, necessarily.


18:40 - 18:56
Kirby Rosplock

Now, it's often separated, actually, so that you have, in many cases, you will have a senior generation Or, you know, the promoters generation is, as Bill was describing there, will become the owners of the enterprise.


18:58 - 19:00
Kirby Rosplock

But that's certainly not necessarily how it's funded.


19:00 - 19:08
Kirby Rosplock

Family offices are structured like the business and sometimes they also want to really justified as a business.


19:09 - 19:16
Kirby Rosplock

And so how they build their customers for services as it were, whether that's, you know, entirely family members and trust.


19:16 - 19:19
Kirby Rosplock

Obviously we should set, we should set apart right now.


19:19 - 19:34
Kirby Rosplock

If they're becoming multi-family offices are taking in third party money and looking to actually, you know, turn a profit or cover the costs of the founding family by fees, you know, to other families.


19:34 - 19:41
Kirby Rosplock

That's, that gets you into, you know, it's a logic, but Speak ..., with single family offices, at the moment.


19:41 - 19:47
Kirby Rosplock

Often that promoting generation will be the elders, and they want governance control.


19:48 - 19:51
Kirby Rosplock

They want to know whether they're, they're inviting him to the control.


19:51 - 19:57
Kirby Rosplock

That entity as the next generation, is, which I think so.


19:57 - 20:06
Kirby Rosplock

So they'll want to own it, but they may have ideas about family equity and paying for it, what you would occur.


20:06 - 20:19
Kirby Rosplock

That leads to wanting children and Next gen, to understand that, if they're gonna take all of the admin assistants, time with their personal business interests, that stuff, then they should get a bill for that.


20:20 - 20:31
Kirby Rosplock

So, you know, oftentimes, it starts out with that first generation subsidizing costs, but over time, developing a model where you pay for the time of the employees that you use.


20:31 - 20:59
Kirby Rosplock

And, in many cases, what we see sophisticated family offices coming up with over time, especially when they get into further generations, is a mixed model on that, where you now have enough assets under management and multiple participants in obtaining services that you're charging and AUM type of fee.


20:59 - 21:06
Kirby Rosplock

To cover the costs of the office, which as potentially is important too, present day DACs, efficiencies.


21:06 - 21:17
Kirby Rosplock

And on the other hand, when it comes to, shall we say, walking the dog or, you know, the concierge services, that's where you want to make people pay for their play.


21:17 - 21:28
Kirby Rosplock

So that, you know, your staffing needs and stuff adds something to discipline, which is that, you know, people know to the extent they're going to take this time, they're going to have some some cost impact.


21:29 - 21:32
Kirby Rosplock

So, it'd be often becomes a mix.


21:33 - 21:45
Kirby Rosplock

And Bill, when you see the senior generation start to fade and maybe pass away, you see the next generation beneficial owners are in adulthood.


21:45 - 21:53
Kirby Rosplock

Now, talk to me a little bit about the transfer of what happens at an ownership level, and when we think about how we pay for this office structure.


21:54 - 21:56
Kirby Rosplock

I would imagine this is a critically tense period.


21:56 - 21:57
Kirby Rosplock

Right?


21:57 - 22:04
Kirby Rosplock

If you have family members who are beneficial owners who really didn't, I, I didn't intend to set this up by now.


22:04 - 22:10
Kirby Rosplock

I have to pay for this, Tell us what you've seen and what's the experience of families who do it well.


22:11 - 22:12
Kirby Rosplock

Certainly.


22:14 - 22:36
Kirby Rosplock

As family sophistication grows and his family member ship expands, I find a contrasting contraction of the ownership, rather, it's only those that are engaged, or even a structure that allows for voting rights, but not ownership of the family office.


22:36 - 22:36
Kirby Rosplock

Itself.


22:36 - 22:42
Kirby Rosplock

So, it really ends up becoming a consolidation of responsibilities.


22:43 - 22:58
Kirby Rosplock

And I also very much like the idea of in the end, we will explore non-stop corporate ownership, purpose, trust ownership, or now we have foundations in two states in particular, Wyoming and New Hampshire.


22:58 - 23:04
Kirby Rosplock

So, those offer some interesting, cutting-edge opportunities to have types of entities that may or may not have owners.


23:05 - 23:10
Kirby Rosplock

And I like that because what it does is it forces the funding required.


23:10 - 23:17
Kirby Rosplock

The funding requirement or responsibility to come from those using the services much like Ivan described.


23:18 - 23:45
Kirby Rosplock

I can alternative to that, or, another variation on it, because Ivan's, right, ultimately, it's complex, and it suits the needs of those who are using the services, but it almost becomes like, a club: one, my family members, that benefit from this, and trusts, and trustees that that require those services may have an annual nominal annual fee to ensure that there's a certain amount of running capital for basic uses.


23:45 - 23:46
Kirby Rosplock

And then after that, it goes on.


23:47 - 24:03
Kirby Rosplock

Similarly, when it comes up in property management contracts, where families acquire a fair amount of luxury properties, whether they're real estate in one jurisdiction or another, or boats and planes, things that have high running costs.


24:04 - 24:08
Kirby Rosplock

A lot of times, the family office is tasked with that, but not everybody's using it to the same degree.


24:09 - 24:16
Kirby Rosplock

What we do want to watch out for, though, is that the family office doesn't operate in such a consolidated manner.


24:16 - 24:32
Kirby Rosplock

So, as to simply be seen as managing one's own investments, In other words, the ownership of the family office tied closely to those who are using it and benefiting in the investment management context that comes with its real risks from a tax perspective.


24:32 - 24:40
Kirby Rosplock

We also need to be careful of the responsibilities when there are fiduciary duties that come up.


24:40 - 24:48
Kirby Rosplock

We have some IRS guidance and concerns over retained, control possession and enjoyment.


24:48 - 24:57
Kirby Rosplock

And so we want to be careful that those owning the family office and providing services don't encroach upon a fiduciary responsibility.


24:57 - 25:02
Kirby Rosplock

Then suggest that those who believe they had actually transferred assets did.


25:02 - 25:03
Kirby Rosplock

In fact, routine control.


25:03 - 25:07
Kirby Rosplock

So these are the different considerations that go into that, who owns the family office?


25:07 - 25:09
Kirby Rosplock

How does it succeeds in the next generation?


25:09 - 25:12
Kirby Rosplock

And then how does that complemented by funding?


25:13 - 25:13
Kirby Rosplock

Excellent.


25:14 - 25:25
Kirby Rosplock

Now, just in closing, Ivan, any last thoughts about best practices when paying for an office structure and or ownership considerations.


25:27 - 25:42
Kirby Rosplock

Well, I think, you know, whether the initial founders of a family office pay for it and choose for estate planning strategic reasons, or otherwise, you're happy to pay for it, or you go to a model where everybody's paying for it.


25:42 - 25:55
Kirby Rosplock

You know, as a big believer in the value that family offices add to families and to strengthen the past The retention of family wealth and growth across the generations.


25:55 - 26:09
Kirby Rosplock

I think it starts very much with education that the next generations are learning where that value add is, and not suddenly shocked to find costs going on here.


26:10 - 26:27
Kirby Rosplock

You know, Petulant, that is, you know, not unheard of dynamic, which you were alluding to, but you know, they have to see the value in the concentration of their purchasing power, they're, you know, the the group insurance.


26:27 - 26:33
Kirby Rosplock

That group benefits that they're getting the risk protection, they're getting, from having professionalized.


26:36 - 26:40
Kirby Rosplock

Management of the varieties of risks to wealth across generations.


26:40 - 26:46
Kirby Rosplock

And it's always hard, because it's not as easy to quantify you, know.


26:46 - 26:50
Kirby Rosplock

It's not easy to quantify what didn't happen to you when you got a divorce.


26:50 - 26:56
Kirby Rosplock

You know what didn't happen to you when someone asked away the family, and there was no taxes, Right.


26:56 - 27:14
Kirby Rosplock

So, so, I think the founding generation and the family professionals certainly an important, you know, element to educating family members as offices like that grow.


27:14 - 27:18
Kirby Rosplock

So that when they do see the cost, say, understand what they're getting for it.


27:19 - 27:22
Kirby Rosplock

Yeah, absolutely, Bill, any last closing thoughts?


27:22 - 27:29
Kirby Rosplock

Part of that value, Iven, was right to point out that there's a series of values that this can provide.


27:29 - 27:31
Kirby Rosplock

And I think that understanding that is so important.


27:32 - 27:35
Kirby Rosplock

It's a risk management tool in many families.


27:35 - 27:46
Kirby Rosplock

It's a, it's an entity that conserve in other roles, such as a manager, general, partner of underlying asset owning entities, which does ultimately help insulate individuals'.


27:46 - 27:52
Kirby Rosplock

It, also provides for income streams that are not otherwise available, and can be very advantageous to a family.


27:52 - 28:03
Kirby Rosplock

So, in addition to the group benefits, the economies of scale, that a family member gets there, is that risk management side of it, too, and continuity of family history.


28:03 - 28:11
Kirby Rosplock

So, all of this makes it a viable and important sort of option for the sophisticated or the organized family.

28:12 - 28:13
Kirby Rosplock

Excellent.

28:13 - 28:19
Kirby Rosplock

Thank you gentlemen so much for being here today, the Tamarind Learning Podcast, your host Kirby Rossbach.

28:19 - 28:20
Kirby Rosplock

I'm here with Ivan Sacks.

28:21 - 28:30
Kirby Rosplock

And with Bell Canvas, from whether it's worldwide, they are co-authors of Chapter five on Setup Instructure and Operating Family Office.

28:30 - 28:32
Kirby Rosplock

We're delighted to have you both here today.

28:32 - 28:34
Kirby Rosplock

Thank you so much for your time and sharing your wisdom.

28:35 - 28:36
Kirby Rosplock

Thank you.

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