Private equity (PE) and venture capital (VC) remain cornerstone allocations for sophisticated investors. These asset classes continue to offer strong return potential, but increasingly, families are drawn to the sense of control and influence they provide. According to bfinance, all surveyed family offices reported exposure to private equity (versus 76 per cent of institutional investors) and 89 per cent invest in venture capital. Around half plan to increase allocations over the next year. For many, this is more than a financial decision; it is a way to play an active role in shaping the future of business, backing transformative founders and ideas.

Direct and co-investments are also gaining momentum, particularly in sectors where innovation is rewriting the rules. Families are gravitating toward deals in artificial intelligence, biotechnology and fintech, areas that align with their long-term convictions and values. These investments offer the opportunity to go deeper than traditional fund commitments, allowing families to partner directly with entrepreneurs and influence outcomes meaningfully. The appeal lies not only in potential upside, but in engagement and impact.

Real estate remains a steady pillar in portfolio construction, offering a rare combination of yield, appreciation, and tangibility. According to the 2025 Knight Frank Wealth Report, roughly 28 per cent of family offices have increased property allocations in the past year. Sector preferences are evolving: luxury residential and hospitality assets are benefiting from the travel rebound, while industrial properties continue to ride the logistics boom. Office exposure, by contrast, is increasingly selective and geography-specific.

Investment styles are shifting too. Families favour opportunistic (around 30 per cent) and value-add (around 30 per cent) strategies with medium- to long-term horizons. These are not short-term speculations; they reflect a multi-generational mindset, building income resilience, anchoring estates and often enabling social or environmental purpose through development.

After years of near-zero rates, fixed income has returned to the spotlight. Yields across developed markets remain at their most attractive levels in more than a decade, and families are once again valuing the stability and visibility that high-quality bonds can provide. According to Citi Private Bank’s 2025 Global Family Office Report, family offices are keeping overall allocations steady while prioritising portfolio resilience and liquidity. This has translated into a renewed focus on investment-grade credit, short-duration strategies, and selective sovereign exposure; instruments that can dampen volatility and preserve optionality in uncertain macro conditions.

Private credit has emerged as a natural complement to this renewed fixed-income focus. As banks continue to retrench from segments of the lending market, private lenders are filling the gap with tailored financing structures and attractive yields. Families are seizing these opportunities to capture steady cash flows with greater control over risk, governance and alignment of interest.

The latest BlackRock Global Family Office Survey 2025 shows that alternative assets now account for roughly 42 per cent of total portfolios, up from 39 per cent in the prior survey. Nearly one-third of family offices intend to increase allocations to private credit, and a similar proportion are planning to expand infrastructure exposure – a clear sign that families see debt as a strategic source of durable returns in a volatile world.

Still, the search for yield remains measured. The most disciplined investors are interrogating liquidity terms, rate sensitivity and counterparty risk before committing capital. In 2025, the focus is not simply on generating income, but on ensuring the resilience of that income, building portfolios that can withstand both market cycles and policy shifts.

Digital assets, once a niche frontier, are now earning their place on the family office agenda. A recent BNY Mellon report reveals that 39 per cent of single-family offices either hold or are actively exploring cryptocurrency investments. Though allocations remain modest, averaging around 1.8 per cent, the direction of travel is clear. Crypto is increasingly seen not as a speculative punt, but as a tool for diversification, inflation hedging and exposure to blockchain-based infrastructure. As regulatory clarity improves and custody solutions mature, more families are tiptoeing into this space with cautious optimism.

Volatility and governance remain watchpoints, but the tone has shifted. Digital assets are no longer viewed solely through the lens of retail hype; they are now part of a broader thematic play on decentralisation, digital ownership and alternative store-of-value systems. For younger generations within families, this is often their first foray into investing – and one that shapes how they see risk and opportunity.

Beyond financial assets, real assets are enjoying renewed attention. Gold, fine art, vintage cars and rare wines are not just collectibles; they are expressions of taste, identity and permanence. According to Investopedia, allocations to alternative investments are rising, with a growing emphasis on tangible value and cultural legacy. For many families, these assets reflect something deeper than returns: continuity, meaning and an emotional connection to wealth stewardship.

Environmental, Social and Governance (ESG) considerations have moved firmly into the mainstream. No longer a niche interest, ESG investing is now an integral part of portfolio construction, particularly in Europe where 57 per cent of family offices engage in sustainable or impact-oriented investments, up sharply from 45 per cent in 2021. This is not driven only by regulation or optics; it is driven by next-generation family members who are insisting that their capital aligns with their values.

From renewables to microfinance, families are supporting businesses that do not only perform but serve. Clean energy, climate technology, inclusive finance and equitable housing are all gaining traction as themes. The shift marks a redefinition of what it means to invest well: performance and purpose, profit and principle, no longer viewed as mutually exclusive.

Innovation-focused strategies are gaining ground, particularly those that provide early exposure to paradigm shifts. AI, blockchain, robotics and clean tech are no longer science fiction. Family offices are partnering with venture funds or building their own innovation vehicles to access frontier technologies early. These bets reflect more than a quest for outsized returns; they represent a worldview in which capital can shape the future, not merely ride it.

Families are also acknowledging the growing need for geographic diversification. With geopolitical risks rising and local market volatility increasing, there is a measured pullback from traditional strongholds. While allocations to North America and Europe have declined slightly, exposure to Asia-Pacific has grown from 20 per cent to 22 per cent, reflecting confidence in its long-term growth narrative. Latin America is inching upward, while the Middle East and Africa remain stable. Currency risk, capital controls and jurisdictional law are being examined more closely, as families hedge both returns and political risk.

In 2025, the smartest families are pursuing investment strategies no longer siloed by asset class or geography; they are adaptive, layered and guided by both intuition and insight. Their portfolios combine the enduring with the emergent: solid foundations in private markets and real assets, a deliberate pivot toward sustainability and a disciplined embrace of transformative technologies and ideas.

This new paradigm is not merely about wealth preservation; it is about legacy creation, value alignment and strategic influence. It marks a shift from passive ownership to active stewardship – from wealth as accumulation to wealth as agency. In this landscape, capital is not judged by how much it grows, but by what it enables: stability, progress and continuity in a world that rewards foresight. Purposeful capital is not a trend. It is, unmistakably, the new default.