August 2023

For alternative managers, the first half of 2023 was a trip into unchartered waters - rate rises, confused central bank messaging, misfiring economies and ongoing war pressures - it was challenging, tiring and full of nasty surprises.

The number of family offices across the globe has risen steadily over the past decade, and family offices are playing an increasingly important role in the private markets. In Europe alone, both the volume and value of family office deals – whether as the target location or origin of a transaction elsewhere – are running at record levels.

Unusual and disruptive macroeconomic events dominated the financial headlines of 2022. However, whilst attention was so often fixated on the behaviour of governments and central banks, it is worth addressing how a year of political and economic uncertainty was met by investors and, more specifically, those working in the family office space.

For those who remember the popular film Back to the Future (1985, Universal Pictures), the central character, Marty McFly, accidentally travels back in time to the 1950s, and in doing so alters his family's future by changing the past.

We are constantly hearing contrasting views on today's second-hand watch market. On the one hand, after a couple of years of intense enthusiasm and euphoria, there is chatter about the market going through an unprecedented crisis, with some even predicting its demise.

As we enter a new year, many will be happy to see the back of 2022, which brought a cocktail of challenges, from Russia's invasion of Ukraine, rising inflation and an energy crisis, to recession fears and slowing global growth.

Viewers of my generation and older will recall the above slogan being used in an advertising campaign for a wood stain and dye manufacturer back in the early 1990s.

Ensuring an international family's global wealth structure meets the family's varied and changing needs can be a daunting task. Many families choose to establish a family office to ensure the family's needs and the relevant legal and regulatory requirements are properly and efficiently met.

Family offices were involved in an estimated 10% of all deals globally in 2021. In a study of Family Office Deals, PwC found that after a temporary decline in 2020 due to the pandemic, the value of disclosed family office deals in 2021 reached USD 227.6bn – a record high.

Over the last few years, there has been a slow but noticeable shift in how family offices invest. Although the structural variety within the space means making such a broad claim is risky, the definitive rise in popularity of private investments makes this a trend worth examining.

It's fair to say institutional investors have some advantages over the rest of us. They have rigorous efficiency, organisational depth, structure, transparency, scale, a strong process, governance, regulatory scrutiny, data, technology and a vast pool of human and intellectual capital.

When you strip away the lively discourse around the outsized returns that some alternative investment fund managers can generate, the proactive efforts to align their interests with their investors are arguably the most attractive aspect of their offering.

The past year has seen a notable slowdown in the volume of manager search activity conducted by institutional investors such as pension funds, insurers, foundations and university endowments, according to client data from independent global investment consultancy bfinance.

AIMA's Global Investor Board (GIB) is a global advisory board created by AIMA, the global representative for the alternative investment industry, to further strengthen its engagement with the global investment community from across the alternative investment universe.

As the Chief Executive of Parkwalk, the UK's largest growth EIS fund manager, I've got to know dozens of founders over the last 14 years and as the UK's largest investor in university spinouts, it's clear to me that the UK has no shortage of talented people looking to commercialise their breakthroughs.

This year has so far been somewhat surprising on the VC hiring front, with many funds still looking to add investors to their team. The background of these funds are robust platforms, pre-seed to seed as their primary investment strategy with a good history of exits.

That private market multiples have come off the highs of 2020-2021 is not news. The why, however, is worth exploring. I propose four reasons as to why, with the fifth being higher interest rates, not discussed for fear of stating the obvious.

"It was the best of times, it was the worst of times" is the famous opening to Charles Dickens' A Tale of Two Cities. This sentiment comes to mind whenever I'm asked for my views on the private credit market and how current challenges in the economy are shaping the growth of the sector.

The rapid advancements in technology have had far-reaching impacts on various industries, including the financial sector. One area that has experienced significant change is the alternative asset market.

Over the past decade, private capital markets have seen unprecedented growth, not only in transaction and dollar volume, but also in deal complexity. This growth has led to a significant institutionalization of General Partners.

Since the pandemic, which served as a catalyst for digital transformation in many financial institutions, sophisticated, new technologies are deployed with increasing velocity. Future innovation in the sector will revolutionize the way many firms operate.

Artificial intelligence (AI) is rapidly transforming the private capital markets, bringing about new opportunities and challenges for investors, fund managers, and other market participants.

Hedge funds looking to expand their horizons are turning to Dubai with a sense of optimism at a time when they see more challenging operating environments in more established markets.

The Dubai International Financial Centre (the DIFC), a financial free zone within the Emirate of Dubai, is the largest financial services centre in the Middle East, Africa and South Asia (MEASA) region.

For almost two decades, the Dubai International Financial Centre (DIFC) has been positioning itself as a leading financial hub in the Middle East and North Africa (MENA) region.

The past year has seen plenty of noise regarding alternative investment funds, including some of the largest names in the hedge fund industry migrating to the United Arab Emirates (UAE).

When the economy wobbles, it would appear that there are two somewhat distinct politically-driven regulatory responses. The first was seen in the aftermath of the 2008 financial crisis which saw a dramatic increase in regulatory requirements.