OAK PARK, ILL. -- In the mid-1980s, Sara Hamilton was making house calls on wealthy families as part of a fact-gathering mission for Harris Trust and Savings Bank.
Criss-crossing the country, she interviewed 20 families who had professionals managing the family business from a "home office."
In offices dotting the map, she discovered, these employees were starving for information about their peers that could help them perform better.
"I began to see a need for an information clearing house for these professionals," she said recently in an interview in her office in Oak Park, Ill.
Ms. Hamilton left Harris Trust and in 1989 set up Office Exchange to cater to families wealthy enough to have home offices for handling investments. These offices are often set up by families that have sold a business and been left with substantial sums to reinvest.
Family Office Exchange appears to be a resounding success. Its revenues have grown by 30% a year and are expected to hit $1 million for 1994.
The firm regularly serves 40 wealthy families and has worked with 120 of the 2,000 families with home offices, Ms. Hamilton said.
It provides members with a quarterly newsletter, consultation, topical conferences, and help with hiring office executives. It also works with trust companies and private banks to improve their services and knowledge of the market.
"She's positioned herself as the first and most comprehensive source to the family office," said Barry R. Sloan, senior vice president with J. & W. Seligman & Co., anew York-based trust company.
With its continuing contact with family offices and ongoing studies of the market, Family Office Exchange is very current on issues affecting the wealthy, Ms. Hamilton says. It "understands the trends in this market and ... knows how to express the issues to bank officers and trust officers," she said.
At the Exchange, work breaks into three groups: membership services, consulting with current or new home office employees, and recruiting new office employees.
The newsletter, typically eight pages on glossy paper, is a major component of the company's effort to build information sharing between families. A standard feature is a profile of one wealthy family.
A Caution for the Wealthy
The following excerpt from an article examining the proper way to judge custodians is typical of the advice Family Office Exchange publishes:
"Remember that if a bank is offering you a |special deal' it is at the expense of existing clients, and this same approach may be taken when you are the client and the custodian pursues other new business opportunities."
As home offices have become more sophisticated, wealthy families are looking for top-notch employees, Ms. Hamilton said. More and more of the firm's time is spent on doing executive searches for families, she said.