Family offices and wealthy private investors
Wealthy families, often through a private company that manages their money (a family office), invest directly in businesses. They can be more patient and flexible than funds, but there is no standard process and they are hard to find.
- Shares
How it works
A family office manages the money of one wealthy family, or a few. Some invest directly in private companies, as well as through funds.
The British Business Bank notes that private equity money now comes increasingly from high net worth individuals, families and family offices, and sovereign wealth funds, as well as banks, insurers and pension funds, and that these less formal investors tend to have more appetite for risk. That can make larger equity investment more open to younger, riskier businesses.
- No standard terms: each family sets its own approach, time horizon and deal terms.
- Introductions matter: family offices rarely advertise. Most deals come through advisers, other investors and personal networks.
- Promotion rules: inviting people to invest, in the course of business, is a financial promotion. It is restricted unless an exemption applies, such as for certain high net worth or sophisticated investors, or an FCA-authorised firm approves it.
Upsides and downsides
Upsides
- Can be more patient and flexible than investment funds
- More appetite for risk than traditional institutions, according to the British Business Bank
- Can invest alongside other investors or on their own
Downsides
- Hard to find, and no standard way to apply
- Terms vary a lot from one family to another
- Some families want a big say in the business
Risks
- The family's priorities changing, or a generation handing over
- Promoting the investment in a way that breaks financial promotion rules
What it costs
- How it is priced
- Shares in your company, on terms agreed with each family
- Costs that are easy to miss
- Legal and adviser costs
- Introduction or adviser fees if someone finds the investor for you
- Rights the family asks for, such as a board seat
Varies widely. Each family office sets its own size of investment.
Have an offer? Dilution calculator: see what you would own after each round
Does it fit?
Could fit when
- You are a growing company with a strong plan and are open to a significant investor
- You have contacts with wealthy investors or advisers who can introduce you
Unlikely to fit when
- You want to keep all your shares
- You have no route to an introduction
Who can use it
- Business types: Private limited company, Public limited company
- Each family office has its own interests, sectors and size of deal
- Usually reached through introductions rather than open applications
Am I ready?
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- Pitch deck
- Financial model
- Routes to investors
Regulation and protections
A private deal between your company and the investor. Promoting investments in the course of business is restricted by section 21 of the Financial Services and Markets Act 2000.
Types of provider: Single-family and multi-family offices; High net worth individuals.
Also consider
Sources
- British Business Bank: Private equity checklist · checked 7 October 2026
- legislation.gov.uk: Financial Services and Markets Act 2000, section 21 (restriction on financial promotion) · checked 7 October 2026