In 2025, India stands at the cusp of becoming a $5 trillion economy, propelled by a dynamic interplay of innovation, entrepreneurship, and strategic investments. At the heart of this economic transformation are family offices, private wealth management entities that have evolved from mere custodians of generational wealth to powerful catalysts for business growth. With over 300 family offices managing approximately $30 billion in assets under management (AUM) in 2024, these entities are reshaping India’s business landscape by channeling patient capital, expertise, and networks into startups, small-to-medium enterprises (SMEs), and high-growth sectors. This article explores how family offices are driving India’s economic ascent, fostering innovation, and securing legacies for future generations.
The Evolution of Family Offices in India
Family offices in India have undergone a remarkable transformation. Historically, they focused on preserving wealth through conservative investments in real estate, public equities, and fixed-income assets. However, the rise of ultra-high-net-worth individuals (UHNIs)—projected to reach 19,908 by 2028, a 50.1% increase from 2023—has reshaped their role. Today, family offices are sophisticated hubs for investment, governance, and succession planning, driven by first-generation entrepreneurs and next-generation heirs with a global outlook and a penchant for risk.
The surge from 45 family offices in 2018 to over 300 in 2024 reflects this shift. Fueled by liquidity events like startup exits, IPOs, and private equity windfalls, families are formalizing wealth management through single-family offices (SFOs) and multi-family offices (MFOs). For instance, Sharrp Ventures, the family office of Harsh Mariwala (Marico Ltd.), has pivoted from traditional investments to backing consumer-tech startups like Mamaearth and Nykaa, illustrating a broader trend of diversification into high-growth sectors.
Fueling Startups and Innovation
One of the most significant contributions of family offices is their investment in India’s startup ecosystem, which raised $150 billion by 2024. Family offices accounted for $9.6 billion of the $23.7 billion in venture capital (VC) investments in 2022, demonstrating their growing influence. Unlike traditional VCs with fixed investment cycles, family offices offer patient capital, allowing startups to prioritize long-term growth over short-term exits. This flexibility is critical in a market where foreign direct investment (FDI) declined 16% to $70.9 billion in FY24, underscoring the need for domestic capital to fill the gap.
Family offices bring more than just funding. They provide “relationship capital” and “expertise capital,” leveraging decades of business experience to guide founders. For example, Premji Invest, the family office of Azim Premji, supports startups like ID Fresh, offering mentorship in operations and scaling. Similarly, Survam Partners, backed by the Hero Group’s Suman Kant Munjal, has invested in tech-driven ventures like BharatPe and BluSmart Mobility, fostering innovation in ecommerce and sustainability. Since 2014, family offices have backed over 200 startups, with a focus on fintech, ecommerce, and enterprise tech, contributing to the creation of 108 unicorns and over 60,000 startups.
Driving Economic Growth Through Strategic Investments
Beyond startups, family offices are investing in core industries like technology, healthcare, real estate, and renewable energy, which are pivotal to India’s economic growth. In 2024, 60% of family office capital was allocated to listed equities, but there’s a growing appetite for alternative investments, with 10–20% of portfolios now dedicated to private equity and venture capital. For instance, B2V Ventures, the family office of B L Taparia (Supreme Industries), has a diverse portfolio spanning private equity, real estate, and even art, with investments in unicorns like Cult.fit.
Family offices are also venturing into hospitality, recognizing the potential of tier-2 cities where domestic travel is booming. Hotel deals reached $167 million in 2024, driven by family offices viewing hotels as income-generating assets rather than luxury investments. This strategic shift aligns with India’s rising market capitalization and population growth, positioning family offices as key players in job creation and economic resilience.
The establishment of Family Investment Funds (FIFs) in GIFT City has further amplified their impact. Regulated by the International Financial Services Centres Authority (IFSCA), FIFs enable family offices to invest in international securities, real estate, and unlisted assets, enhancing global diversification. This flexibility has attracted 28% of global family offices to increase their exposure to India in 2025, according to the UBS Global Family Office Report.
Governance and Succession: Building Sustainable Legacies
Family offices are not just financial vehicles; they are stewards of generational wealth. With only 63% of Indian family offices having formalized governance structures, there’s a growing emphasis on professionalization to ensure smooth succession and business continuity. Structured governance, including shareholder agreements and family constitutions, mitigates conflicts and aligns family values with investment strategies. As Anand Shah of AZB & Partners notes, “Governance and family dynamics are critical. Simplifying holdings ensures both business continuity and family harmony.”
The next generation is driving this change, prioritizing sustainability, ESG (environmental, social, and governance) investing, and philanthropy. For instance, 48% of family offices are concerned about shifting tax laws, prompting them to adopt tax-efficient structures like private trusts and offshore entities in Dubai, Singapore, or GIFT City. These efforts ensure wealth preservation while contributing to societal impact, with many family offices supporting initiatives in education, healthcare, and sustainability.
Challenges and Opportunities
Despite their growth, family offices face challenges. Reluctance to trust external professionals remains a hurdle, with many families preferring to keep wealth management in-house. Regulatory ambiguity, particularly around potential inheritance tax, requires proactive planning. Cybersecurity is another concern, with global financial sector losses exceeding $20 billion in 2024. To address this, family offices are adopting AI and machine learning for risk assessment and portfolio management, enhancing resilience.
Yet, the opportunities are immense. Family offices are uniquely positioned to capitalize on India’s economic growth, projected to make it the world’s third-largest economy by 2027. Their ability to provide patient capital, mentorship, and strategic networks makes them indispensable to startups and SMEs. Moreover, their focus on ESG investing aligns with global trends, attracting international investors seeking impact-driven opportunities.
The Road Ahead
In 2025, family offices are set to play a pivotal role in India’s journey toward a $5 trillion economy by 2047. With the Indian family office market projected to grow from $673.3 million in 2024 to over $6.9 billion by 2033, their influence will only expand. By doubling down on global diversification, technology adoption, and governance, family offices are evolving into institutional-grade entities that balance tradition with innovation.
As Rishabh Shroff of Cyril Amarchand Mangaldas emphasizes, India needs at least ten times more family offices to meet its economic goals. By investing in innovation, supporting entrepreneurship, and ensuring domestic capital stays within India, family offices are not just preserving wealth—they are building a vibrant, self-reliant economy. From Sharrp Ventures’ backing of consumer brands to Premji Invest’s support for tech startups, these entities are shaping a legacy that transcends generations, driving India’s growth story forward.
Sources: EY–Julius Baer’s The Indian Family Office Playbook, PwC, Tracxn, Inc42, and posts on X.
Last Updated on: Monday, July 14, 2025 10:36 am by Puneeth kamalapuram | Published by: Puneeth kamalapuram on Monday, July 14, 2025 10:36 am | News Categories: News
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