Portfolio & asset strategy
Matching asset allocation to owner intent
Comparing goals and performance across different categories of assets (e.g. businesses, financial investments and real assets) can feel like comparing apples to oranges.
As such, many professional advisors stick to their area of expertise. There is often no “top level” forum to review the aggregate performance of the collective wealth – nor the ongoing rationale for the unique mix of assets and exposures.
Forming a holistic view of family wealth
With deep experience in both the corporate and investment worlds, we look across all asset classes, building an integrated view of the family’s entire asset base.
We use our broad perspective to help families understand the historic performance of each asset class relative to what good looks like, focusing on long-term total return.
Supporting purpose-aligned capital decisions
We believe capital allocation is key to value creation in family businesses. We look at how capital has been allocated between businesses or investment units; where it is currently tied up; where surplus capital is being generated; and, on occasions, where it has been destroyed – and why.
As your independent strategic advisors, we sit with you at the portfolio board level. We support you by helping to ask the right questions, looking at the information in the right way, and helping you as you make key decisions. All of this serves to better deliver against your owners’ mandate.
Clarifying key capital questions
Settling on a “macro-level” portfolio strategy ensures that active choices are made about capital allocation between businesses and investment opportunities.
Common questions we address at this level of strategy include:
Should we increase dividend extraction or re-invest for growth?
Does re-investment in an operating business offer a benefit compared to moving surplus capital into a financial portfolio (or family office)?
What do we do with a realisation of value from the sale of a substantial asset (e.g. business or property)? Do we reinvest in the asset class (often the default choice)? Or do we actively review our wider options?
Should we exit companies in markets with poor structural characteristics or where we are not the natural owners?
An overarching wealth strategy provides a framework for rational discussions that are grounded in the reality of each family’s unique asset base.
Overall portfolio strategy
Making Purposeful Decisions Across the Portfolio
Families often face a choice between continuing fully invested in Operating Business(es) or extracting liquidity to diversify, in part or fully, into other asset classes.
We link this discussion back to the owners’ intent, but we also ground our support firmly in the commercial reality of the family’s assets. We help families take the long-term view on their businesses’ evolution and consider their alternatives – in light of their wider purpose, values and family development.
Family investment office strategy
Creating the right family investment office structure
We help families decide whether to set up Single Family Investment Offices (“SFOs”) and, if so, how to go about it. We can act as ‘architect’, ‘project manager’ or ‘builder’ to bring it to life.
We have experience identifying the interim or permanent talent that can accelerate your progress, and we have helped along the full lifecycle of an SFO.
Once the unique role of the SFO is defined, we help clients optimise its strategy and governance framework. Our focus is on enabling capital allocation at the highest level and over an inter-generational timeline. We ensure this approach fits each family’s vision, capabilities, and available resources.
We also help you assess where to focus, how to build capabilities, when and how to outsource, and how to build and remunerate teams.
Developing existing SFOs to meet new challenges
For existing SFOs, we work with the owner group and executive team to adjust strategy and governance to better match the mandate from the Family Owners’ Board. We also work through unexpected challenges caused by market setbacks or personnel turnover.
Providing guidance through critical changes
We support clients through special situations. For example, helping to form a new team or ‘business unit’ with the SFO – or thinking through whether a commercial pathway may be desirable or realistic for a team that has created a strong attributable track record
Operating business strategy
We understand the capital allocation processes and the skill sets that drive superior performance. We help you critically assess the capabilities of your assets and define the support needed to enable high-quality decision-making in your operating businesses.
Supporting key strategic actions
We sit on your side of the boardroom table and support you in thinking through how best to move forward. This includes situations where businesses require strategic intervention, preparation for sale or turnaround, or when you’re considering acquisitions or divestments.
Moving forward might involve us working with management to develop a business strategy or prepare board materials for a decision. Or it might mean helping you think through the need for external advisors, develop a short list, write an RFP, or help select and run a process to resolve your specific issues.
Enabling clear communication in family businesses
To support change, we work with you to determine the information requirements of portfolio boards and owners. We ensure that there is a process in place that allows this information to flow in the right format, level of detail and frequency for each group.
Measuring what matters to keep owners informed & aligned
“What gets measured, gets done”; an old adage that stands the test of time. But in family systems that have a diverse group of owners with differing needs, and levels of financial acumen or knowledge of the businesses, keeping the owner group informed is an additional challenge. It is, however, key to maintaining harmony and unity in the family.
In complex cases, with many moving parts and where corporate resources are otherwise engaged, we can act as an “office to the Chair” to provide additional bandwidth and complementary capabilities to help things get done.
Who we are
Independent strategic advisors to Owners
Acanthite Partners is an independent, specialist advisory firm dedicated to addressing the unique situations faced by family-owned groups. Our mission is to help families make the right decisions for their business and investments and protect their legacies for future generations.
We create lasting solutions, enabled by decades of experience and an intimate understanding of family dynamics.
CLIENT STORY
Designing a pathway into direct private equity investing
A well-established investment office was successfully running a fund-of-funds mandate. Both the Principals and key Executives expressed interest in allocating a portion of the portfolio for direct investing. They wanted to capitalise on the team’s existing strengths and its network of industry relationships, while navigating the inherent differences between the two styles of investing.
To guide this transition, our Partner worked with a sub-group of Board members and key executives. The first step was to articulate the non-negotiable aspects of their target approach into a “design checklist” for the new concept.