When Scott Saslow was restructuring his family office for his immediate family, he wished he had a book to answer his questions. The process led him to write Building a Sustainable Family Office: An Insider’s Guide to What Works and What Doesn’t, which was published in July.
Saslow is the founder and CEO of Palo Alto, California-based ONE WORLD Investments Inc., which provides investment capital and advisory services to help organizations scale social impact; manages an early stage impact investing fund; and manages his family office. He talks about what he learned while setting up ONE WORLD:
What is the origin of your family office?
I grew up in Chicago. We had a business that was in the family for 60 years. As that grew and as the family accumulated wealth, we started a family office embedded in the family operating business. Some years later, we outgrew that, and we moved to more of an MFO model. Then we outgrew that and moved to a single-family office model. This family office served four principals: my father, myself and my two siblings.
We exited from the family business in 2019. In 2020, there was COVID, of course, but specific to our family was the passing of my father and then a transition in the family office leadership. That required me and my two siblings to very quickly figure out: Where are we going to take all this? We ultimately decided that a hybrid approach made sense for us: Some family assets would remain in a joint entity, jointly held and jointly managed, and some made sense to be split out by the different family lines.
So today, I’m part of two different family offices. I have my own, which I call ONE WORLD, that represents the resources that are controlled by myself, my wife and my two kids. But I’m also still an owner and a principal of our legacy family office, where certain other assets are held.
What questions did you try to answer while setting up your family office?
Setting up the family office for my own family line was a very intense experience — very accelerated learning.
It starts with the role that I, as a principal, should be playing. I knew that I wanted to be involved — I didn’t want to be just a passive shareholder. But as a principal, am I going to be effectively the CEO of this new entity? Am I the right person to lead it? Am I going to be a director and part of a leadership team?
So it was everything from that to questions like: What does this structure need to look like? How much of the existing infrastructure — outside service providers and specialists that the family has had worked with for many years, like estate planners, accountants, investment [professionals] — stays, and which of that maybe needs to be changed? I felt like, as long as there is this opportunity to rebuild, why don’t I look at all the assumptions?
Also, I had my own career, I had my own businesses. I started realizing that there were probably some ways I could leverage some of the resources in the family office — not just family capital, but other resources as well — and essentially merge my day job and my night job, and make them both better.
How did you merge your family office with your other work?
At a high level, I was able to think through: What’s the purpose and mission of my legacy day job, the work I have been doing? Then I said, ‘Can we apply that same mission and purpose to the broader family office?’
If part of the mission of the existing business was to be an advocate for sustainable investing and impact investing, how do we do that with the assets in the family office? How about with some of the non-financial assets of the family office? For example, how do we share learnings between the family office and the impact fund I had been running?
The result was the creation of a few entities under the ONE WORLD moniker. There are both family office entities (for the benefit of the family) and family businesses (to provide outside services to those outside of the family). ONE WORLD’s mission is to enable organizations to scale social impact and to improve the lives of individuals globally. The broad nature of this purpose allows us to approach it from many possible directions. Effectively, what I was able to do was turn the family office back into a family business.
How did you and your family make these decisions?
When my father was still with us, in 2018-2019, and I started to have a sense of my desire to take some portion of my own family-line assets and bring them outside of the first family office, my father was not initially understanding. He thought, ‘If it’s not broken, why do we need to fix anything?’
But when I talked with my siblings about it, there was no blowback at all — in fact, some of them started thinking along the same lines. It was very collaborative. And we continue to function well as both siblings and business partners. It isn’t always easy to wear both hats, but I think in the grand scheme of things, we’re doing very well.
There is a traditional view with a family office that it’s binary — you’re either in it or you’re out. You can’t say, ‘I want to be in for these things but out for others.’ But that’s exactly what the more enduring and sustainable families have actually done. The ones that are hitting the third, fourth or fifth generation of having a family office recognize that it shouldn’t be binary. In fact, some of the people I spoke with for my book said you want to have an open door policy: Not only is it easy to leave if you want to, to take certain assets out, but if you want to come back in a year or three years, that’s great. I think that’s some very progressive thinking that the more innovative family offices have deployed.
What does succession planning look like for your family office?
Our succession plan is a work in progress. I’ve identified both family members and nonfamily members who could take over for me if I was abducted by aliens or something. I owe it to myself and to my family, and to these resources of which I’m a steward, to really be thoughtful and to plan ahead.
My children are still too young to participate in a meaningful way, although I know engaging the NextGen is a hot topic. Even for kids that are as young as middle school, and certainly high school, one of the greatest ways to engage is through startups and pitch events.
For my kids, talking about business is very conceptual — it doesn’t really stick. But when I bring them to a live pitch event, they’re seeing startup founders, who tend to be young professionals. And due to the ecosystem in which we operate with our ONE WORLD companies, they are more often female-led companies than is typically the case in Silicon Valley. So when my two girls see other young women talking about a company and sharing what their mission is, that has been life changing. It’s great learning for them, and for me to hear their questions and ideas.
What have you learned from this process?
I had an underappreciation for the task at hand. It’s not so much any of the individual activities that go into a family office — you know that if you don’t have that expertise, you can hire that expertise. But the real magic comes in understanding how the various functions work together and work for you as a principal.
My main message to other principals is: Make sure you’re always in the driver’s seat and applying your unique point of view. There might be some ideas that look great on paper coming from advisors and consultants, but you know the family dynamics. You know the mission. And quite honestly, you’re not conflicted in the way that sometimes advisors can be.
You worked incredibly hard, or maybe many generations of your family did, to create some wealth. And making money and managing money are two different things. So don’t underestimate the challenge.