Wealthy families are spending millions of dollars to run their private investment companies, called family offices. The main expense is hiring and keeping staff, with competition for talent driving up salaries. Family offices are competing with banks and other investment firms for experienced professionals, as they expand their investments into areas like private equity and real estate. This has led to increased compensation and benefits packages for family office employees.
Globally, about 28,420 "centimillionaires" exist, with the majority residing in New York City, the Bay Area, Los Angeles, London, and Beijing. These individuals hold assets over $100 million and invest differently than typical investors. They focus on preserving wealth through stable investments like real estate and avoid high-risk ventures or volatile assets like cryptocurrencies. Instead, they may invest in private credit, alternative investments, and potentially sports teams.
