Family Offices & Young Innovators - 2 pillars of India's dominance.

During a recent TV interview, Interviewer asked me about the importance of innovation in traditional family businesses.? For the last few years, there have been many deliberations in terms of participation by business families in innovation and family-run businesses. With India being at the cusp of family office structuring?

Note: There are 300 family offices registered in India, & we should see many many-fold increase in these numbers.Have been associated with traditional businesses in different capacities with Pavan Krishnamurthy , Sridhar Rajaram a few others who are equally passionate about this space. ? Two areas are very close to my heart for being backbones of India’s economic dominance. a. How Indian youngsters embrace innovation & become wealth creators

b. How family businesses can leverage innovation to achieve global competitiveness

Naturally, I end up chatting about either/ both of these with most of the professional meetings that I get into, discussions with Aprameya Radhakrishna , Yi Conclave & conversations with #VCfamilybusiness2024 managed by VCCircle being a couple of recent ones. Infact, have been working with Manasa Nagabhushanam at Ramaiah Institute Of Management (MSRIM) , Arun Bhattacharyya & many others for some time to enable improved coordination between institutions and the family offices.

Traditional families have not just built some great businesses, but they are some of the largest contributors to bringing social/economic changes in the regions they operate. With a new focus on manufacturing, real estate, and agri supply chains, we will see a lot more actions in this space.

India has an amazing young talent on campuses. Our young talent on campus has demonstrated their capability both in India and outside through entrepreneurship, innovation & lot more. With many focusing on value creation rather than job hunting, we are seeing brighter days ahead of us.

I find both opportunities can be integrated to leverage each other. Few pointers in that direction

Opportunity: New Venture Creation

We have amazing examples like Bluestone, and Rangsons showing us the path. However, I feel there are a lot more opportunities here when businesses start seeing themselves.? However, family offices need to address the challenges of talent & mindset in their existing organization when addressing these opportunities.

More often than not, such experiments are handholded by consultants without much skin in the game. There is a stronger need for younger members to think fresh and partner with startups/new-age entrepreneurs. "Rights/ agreements" can be structured to safeguard the interests of the family where creating an opportunity to build real disrupters.

?Family offices have been investing in innovation through funds/ directly into startups. But a higher level of interaction/ involvement with the funds/ startups ( being GP's/ team members/ IC members/mentors etc) can unlock value for startups & family offices alike.

But an equally interesting value can be in Family offices/family members Co-creating innovation with bright youngsters ( considering the challenges of hiring great talent).? Family businesses have the advantage of their connections, supply chains, customer base, and maturity. Cocreating companies is an interesting opportunity.

Opportunity: Platforms & products for family offices

OFflate many interesting opportunities/ ideas are being presented in this space.? We have youngsters working on a concept of managing donations based on the “customized give back constitution”, i.e. Set of rules that govern the strategies to give back.

Some of the ideas that are presented include

1. Marketplace for business collaboration/investments? within the family businesses
2. Visibility on strategic startups curated for each business
3. A closed community for family offices, more specifically new generation family members to discuss and learn from each other
4. Luxury experiences for traditional rich families
5. Group decision-making system digitized for easier audit trials &
6. many more

(Note: We will be happy to cocreate such opportunities if there are any entrepreneurs are willing)

???????????

Opportunity: Embrace innovation

Often family offices leave critical technology decisions to consultants/ employees. Technology is no longer a supporting function. Technology & innovation more so the AI innovation is the heart of the future of any business. With AI enabling companies to reimagine their offerings and processes, it might be important for members of the family to get involved in technology decisions/ push forward the appetite for experimenting with new technologies.? It's good for family offices to drive professional managers to report on the innovation as the market will start asking them sooner or later.

Summary?

In all the three areas above family offices & young innovation ecosystem can join hands and make a huge difference to what India has to demonstrate/ offer to the global market.

As CoCreate we not only have many family offices coming as LPs in our fund but are very happy to see the increasing conversation around cocreations, co-innovation, and embracing innovations.