A new analysis conducted by CNBC in partnership with Fintrx, the private wealth intelligence platform, has unveiled the top 10 family offices for startup investments in 2024. These family offices have collectively made over 150 investments this year, spanning various sectors such as biotech, energy, crypto, and artificial intelligence.
Topping the list is Maelstrom, the Hong Kong-based family office of American investor Arthur Hayes, who co-founded the crypto exchange BitMEX. Maelstrom has invested in 22 private startups this year, primarily focusing on blockchain technology. Following closely is Motier Ventures, the family office and venture arm of Guillaume Houzé, a member of the renowned French dynasty that owns Galeries Lafayette and other retailing giants. Motier has made 21 investments in tech startups, with a particular emphasis on artificial intelligence and blockchain, as well as publishing and advertising.
Other notable family offices on the list include Aglaé Ventures, the tech venture arm of LVMH chief Bernard Arnault’s family office, and Emerson Collective, led by Laurene Powell Jobs. Peter Thiel’s Thiel Capital also secured a spot on the list, having invested in Fantasy Chess, founded by Magnus Carlsen, and Rhea Fertility, a Singapore-based fertility-clinic roll-up company.
It is important to note that the list does not disclose investment amounts and may not encompass all deals or family offices, as they are not obligated to disclose their investments. The data compiled by Fintrx is based on both public and private sources.
The ranking sheds light on the growing influence of family offices in the startup capital landscape, with nearly a third of startup capital in 2022 originating from these entities, according to a PWC report. Artificial intelligence has emerged as their preferred investment theme for 2024, with 78% of surveyed family offices planning to invest in AI in the next few years.
Family offices often view startups as idea laboratories, allowing them to gain insights into cutting-edge technology and markets. These learnings can then be applied to larger investments or their own companies. For instance, Eric Schmidt’s family office, Hillspire, has made multiple AI investments this year, which have informed their significant bets on energy companies, considering the power requirements of AI computing.
While many family offices invest in tech startups through venture capital funds, the CNBC list focuses on direct investments made by the family offices themselves. Larger family offices like Hillspire, Thiel Capital, and Aglaé Ventures have dedicated teams of experts who analyze investments and valuations. Smaller family offices and those without a specialization in tech startups typically invest through VC funds.
Co-investing has emerged as a significant trend among family offices, where they partner with VC funds as investment partners, often with reduced fees. This approach allows family offices to leverage the expertise of experienced managers who specialize in tech startups.
However, there are risks associated with family offices venturing into tech startup investments independently. The decline in stock markets and valuations of private tech companies, coupled with a lack of IPOs and acquisitions, has resulted in paper losses and limited liquidity. Family offices are advised to collaborate with experienced managers to navigate these challenges effectively.