Family Office Direct Investment ServicesSM (FODIS)

Many of the clients served by BGA or its affiliates are private families, or entities controlled by such families (e.g. family business holding companies or family offices), which own and control operating businesses or operating assets. Such assets are often described as Direct Investments.

One of the distinguishing competencies within the BGA Affiliate group revolves around helping clients with either new direct investments, or providing deeper support or oversight of their existing direct investments. We describe such services as BGA's Family Office Direct Investment ServicesSM (FODIS). These services are generally applicable to clients who currently own a portfolio of operating businesses or operating assets, or who are seeking to plan and implement a direct investment strategy.

While many private families are attracted to direct investments, many do not have all of the internal resources needed to adequately acquire, grow, monitor or transition their direct investment portfolios. Our skilled BGA Affiliates can assist clients in realizing the full potential of their direct investment objectives or holdings by providing non-conflicted and trustworthy support in one, or more, of the four competencies that are critical to successful direct investment initiatives, as described below.

Direct Investment Planning Direct Investment Execution Risk & Return MeasurementDirect Investment Oversight

Direct Investment Planning

Direct investments involve taking a controlling or significant stake in an operating business or operating asset. Prior to making direct investments an investment policy statement should be developed that takes into account the family's goals and competencies, as well as economic or industry macros that might be impacting the business segments in which they are seeking to invest. Such steps help to clarify and prioritize direct investment research, strategy, initiatives, and capital allocation.

BGA Affiliates and their executive team members or principals have represented hundreds of business owning families and family offices on matters related to their direct investments. Our affiliates leverage the effectiveness of their professional team members through proven processes that are supported by proprietary research, tools and methodologies that can improve direct investment results.

Direct Investment Execution

Few private families employ the range of full-time professional staff members that are needed to manage deal sourcing (especially generating off-market opportunities) and the other activities associated with successfully originating and closing direct investment transactions. In addition, as many wish to partner with other family offices on direct investments, very few have the reach and contacts to find other value-added, compatible family offices as co-investment partners.

By using our deep contacts in the family business industry, we have often been able to identify and complete off-market direct investment transactions while avoiding auction processes. Our network of roughly 400+ family offices has, also, enabled our clients to establish highly successful co-investment partnerships, which we refer to as Family-to-Family (F2F) transactions.

Direct Investment Oversight

Many family offices lack the full-time resources needed to evaluate value creation or enhancement opportunities and strategic alternatives for their direct investments, or to otherwise oversee, govern, improve, and/or monitor their direct investments. Our direct investment implementation, and operating partner capabilities improve results for direct investments.

Our BGA Affiliates have helped clients increase revenue and margins, often significantly, from their operating businesses through a combination of organic and external growth, and operational efficiencies, tied to long-term corporate development programs.

Risk & Return Measurement

Clients often own multiple asset classes in addition to their direct investments, often without an effective means to understand or measure risk and return across all of their holdings. Understanding risk weighted return on capital investment is a key requirement for wealth maintenance and preservation when considering illiquid direct investments and related capital allocations.

Within our BGA Affiliate base, we are able to provide risk measurement services to clients. These services can help identify, measure, monitor, and manage risk, and have been based upon codified ISO standards and supplemented by proprietary tools. These have helped clients avoid the pitfalls that may result in unexpected losses by enabling stress testing, risk sensitivity analysis, liquidity risk assessment, and scenario analysis.