1. Luxe d’Europa
The New Paradigm
There is a new paradigm emerging: collaboration. The traditional offerings of
family offices are primarily based on quantitative services, typically including
investment management oversight and performance measurement, tax
planning, and insurance. But one challenge facing family offices is the
growing trend for “lifestyle/concierge” services. With the renewed sense that
quality of life is another form of wealth management, the question becomes
how to deliver these services. Having the appropriate staff to address the
divergent needs of the family can present a dilemma. With this in mind,
should you build the expertise internally or collaborate? Collaboration is
difficult for many single and multi family offices to embrace since the
traditional approach is to always maintain internal resources. But times are
changing and it’s time to reconsider the conventional model.
The costs of hiring personnel can be expensive particularly when taking into
consideration salary and benefits. Also, the skill set required for quantitative
needs is quite different from the talent required to address “softer issues.”
And lastly, what kind of resources do you want to devote to issues that might
only appear occasionally rather than daily. Since lifestyle services are not
related to the long term investment management goals, it can make more
sense to outsource. With the need to scale services in a cost effective manner,
a collaborative approach can be the easiest way to cut expenses without
affecting service levels to the family.
The needs of the family can be diverse and sometimes can require specialized
talent that must devote 100% of their time to the issue at hand. Is it good
policy to utilize resources that are designated for other areas to meet these
one-off issues? This requires staff members to devote their time to “non
revenue” generating issues when they can be focusing on their individual
areas of expertise. It is a question of allocation of talent and resources.
By building relationships to handle these one-off requests you can eliminate
the internal expense which keeps the overall cost structure in line. Second,
you can identify “best in class” for providing services for a specific need of the
family. Third, you eliminate redundancy with the luxury of cost and time
efficiency. And finally, the family is guaranteed confidentiality and
discretion for issues that may be quite personal, while addressing the issue
appropriately. Also, it allows experts to handle certain situations - not all
family office staff members are equipped to handle these services. More
importantly for consideration is that it is costly and time consuming to

2. employ a wide range of specialists on staff to manage the multitude of
requests by the family. Partnering allows internal professionals to focus on
core services that they are hired and trained to perform and which are
critical to the overall health of the organization.
Luxe d’Europa LLC
Kimberley A. Clark, 300 Park Avenue, Suite 1700, New York, NY 10022, 212-759-2700
Ellen R. Essenfeld, 101 Federal Street, Suite 1900, Boston, MA 02110, 781-749-8519
www.luxedeuropa.com