Detroit native Rose Vitale was only seven years old when she started her first business, where she learned quickly how to turn a profit. “In second grade my dad would give me a quarter, and I would put it in the pencil machine and get two pencils — and then sell them and double my money,” says Vitale, now 43 and co-founder and managing partner of DRA Family Office, a single family office based in San Diego. “I’ve always had the desire to be an entrepreneur.” Read below for more.
That desire quickly morphed into reality. Not formally educated and coming from humble beginnings, Vitale made her fortune as the largest partner for Cricket Wireless, a subsidiary of Leap Wireless International Inc., which AT&T acquired in 2014. After that, Vitale joined forces with T-Mobile and MetroPCS and in her own words, had “an extensive ride with wireless” for more than a decade.
A serial entrepreneur, Vitale co-founded DRA Family Office about five years ago to create “a more holistic approach” to the founders’ wealth management, and to help other women in business reach their dreams and potential, she says. “I’m fortunate enough to be extremely passionate about business and helping female founders because I know how hard it is.”
Vitale is part of an up-and-coming leadership class in family offices: women. Last year, McKinsey reported that women control one-third of U.S. household investable assets, a percentage that will inevitably grow over the next decade. “American women are expected to control much of the $30 trillion in investable assets that baby boomers will possess,” McKinsey says. This shift will occur as baby boomers retire and young, prosperous women become more financially savvy.
But that’s not to say it won’t be challenging for women wanting to lead a single-family or multi-family office. For a century, family offices have mostly been run by men — the grandfathers, the fathers, the sons. Why? Gender biases, a lack of education or interest from the females in the family, or the simplest reason: it’s just the way it was.
According to research by Family Capital, two years ago only 3.5 percent of women were CEOs of family offices, compared with 7.5 percent of women who were CEOs at Fortune 500 companies. Any change since then has likely been minimal. “You’re seeing more and more women get involved but it’s still a really low percentage,” Vitale acknowledges. “I’m now being offered a seat at the table because I’m allocating capital.”
Carol Schleif, chief investment officer of BMO Family Office, a Chicago-based wealth management provider for ultra-affluent individuals and families, says that breaking the patriarchal glass ceiling can be difficult, “because you’re sitting around a table, having to tell your uncles or great uncles or grandfather what to do — and it’s not necessarily a role that women have traditionally played.”
Women, Investments and M&A
Women family office leaders often approach investment choices and M&A with a cautious conservatism. “The women that I’ve met who are leading family offices are very, very thoughtful about who they are going to work with in any kind of strategic way,” says Eric Becker, co-founder and co-chair of Cresset, a multi-family office based in Chicago with about $40 billion in assets under management. “I see it more as being thoughtful and careful than hesitant. It’s smart… and all owners or leaders of family offices could take a page from that playbook.”
Women often “tend to be more deliberate in their decisions and look longer term, and end up more effectively making risk-return judgments” as a result, notes Sharon Olson, founder and president of Olson Wealth Group, a multi-family office in Bloomington, Minn. Olson’s company currently advises many multi-generation ultra-high-net-worth families, along with other private clients, on business succession issues where to allocate their wealth.
San Francisco-based Lawrence Jatsek, managing partner of CRE Development Capital, a multi-family real estate development and investment firm, has partnered in business with Vitale, whom he describes as a tough and candid investor with incredible street smarts. Vitale “will make sure any deal she gets involved with is right, and the players are the right players,” he notes. “If there’s one iota of a question, she has no problem walking away. There’s no messing around.” Women in general, he adds, are “more minute and attentive” in their due diligence than men.
Simply put, summarizes Vitale, “Women sit on the fence a little bit. They mull things over.”
But this can be as much a curse as a blessing, she admits.
“As much as I want to allocate more capital to women, a lot of times I end up working with men. While women are hemming and hawing, I’ve already done the deal with the guy,” she says.
Family Office Deals
While many multi-family offices don’t handle M&A activity for their seasoned entrepreneurial clients, single-family offices often directly engage in M&A, either by doing direct investments or becoming limited partners with private equity or venture capital firms.
“We’ll look at distressed companies that we can acquire and restructure in certain spaces,” says De Anna Guerreiro, founder, CEO and managing partner of Athlon Family Office, in Tampa, Fla. Athlon provides direct investments and solutions to professional athletes, other family offices and ultra-high net worth individuals.
DRA Family Office has taken minority shares in a variety of companies, and in April 2022 announced the creation of DRA Investment Fund I, a $10 million fund dedicated to supporting women business owners. DRA has also worked with CRE Development Capital on hotel investments, Vitale says, and her family office is currently looking to acquire operational businesses “that will be useful to female founders.” And DRA works with private equity firms, funding deals or becoming a capital partner, she adds.
Many multi-family offices, however, focus on M&A and direct investments for their own organizations, hiring a CFO or CEO with investment banking experience “to manage the due diligence of these complex investments,” Guerreiro says.
Some large multi-family offices looking to grow have been fairly acquisitive. More than one-third of Cresset’s assets have come through M&A-related activity, Becker says. Most recently, Cresset acquired TRUE Capital Management, expanding its presence in the sports and entertainment industry. In 2022 Cresset merged with Meristem Family Wealth and in 2021 merged with Berman Capital Advisors.
“We look at a number of deals but with a careful lens,” says Cresset President Liz Nesvold, a former investment banker and entrepreneur. “We will only transact and will only partner if we find people that are philosophically aligned with us, where we can bring something special to the other — all for the purpose of serving the client.” Female leaders, she adds, “will look at M&A but approach it with eyes wide open to ensure it meets many objectives.”
The Future
Role models like Nesvold, Schleif, Olson, Guerreriro and Vitale may help prepare, mentor and propel other women into family office leadership roles, but it’s a steep path to hike and will demand increased education, next-generation confidence and courage — and a shift in patriarchal and industry beliefs. Women still face a tough climb.
“There’s been awesome progress in the last decade, but women are still underrepresented in leadership roles, not just in family offices but in financial services more broadly,” says Becker, who co-hired Nesvold earlier this year. “We’re still not where we need to be.” At Cresset, 44 percent of the organization’s employees are women, he notes.
For now, Vitale says she loves being able to “change people’s lives
on a fundamental level.” She does this through her well-planned investments, in-person meetings, podcasts and public speeches. “I remember what it is like to fight for one more day,” she says. “And now I’m in the position to help others fight for one more day.”
