Ultra-Wealthy Families Shift Billions From Startups to Private Credit and Real Estate

Major Portfolio Shift Among Wealthiest Families

North America’s wealthiest families are quietly reallocating billions of dollars from early-stage startup investments toward private credit and real estate, according to the North America Family Office Report 2025. The comprehensive study, produced by Campden Wealth and RBC Wealth Management, reveals a significant strategic pivot toward stability and predictable returns amid market volatility.

Major Portfolio Shift Among Wealthiest Families
Private Credit Emerges as Preferred Asset Class
Real Estate Maintains Strong Appeal
Startup Investments Lose Favor
Broader Risk-Off Sentiment Takes Hold

Sources indicate that private markets now account for 29% of the average family office portfolio in North America, representing approximately $62 billion of the $215 billion managed by the surveyed families. The report states that this allocation is expected to continue growing throughout 2025, with private credit, direct private equity, and real estate receiving the majority of new investment.

Private Credit Emerges as Preferred Asset Class

Analysts suggest that private credit has become particularly attractive to wealthy investors as traditional markets experience increased volatility. The report highlights that “private credit reflects the high nominal interest rates that sub-investment-grade borrowers are prepared to offer,” making it an appealing alternative to more traditional fixed-income investments.

According to the analysis, larger family offices are especially drawn to this sector, typically investing through funds or co-investing alongside private equity managers. The current high-interest rate environment has reportedly made private credit one of the most sought-after havens for ultra-wealthy families seeking reliable returns.

Real Estate Maintains Strong Appeal

Real estate continues to be a cornerstone of multigenerational wealth strategy, with approximately 75% of family offices maintaining significant property holdings. The report indicates that industrial and logistics properties command the most enthusiasm at 30%, followed by residential housing at 23%.

Regional analysis reveals that family offices in Sun Belt states, where population and job growth are strongest, are outperforming the national average. Researchers note that affordability pressures have “made home ownership increasingly difficult and channeled demand into the rental sector,” though specific quantitative data on rental trends wasn’t provided in the report.

Startup Investments Lose Favor

While private credit and real estate gain momentum, early-stage venture investing has experienced a dramatic decline. The report states that “venture, high-risk investments in early-stage innovative businesses, which was in top position last year, has now slipped down the ranking following its recent poor performance.”

Sources indicate that disappointing returns from direct private equity, private equity funds, and venture capital have contributed to this caution. Family offices, which typically value liquidity and patience, are reportedly finding the decade-long wait for venture payoffs less appealing when higher yields are available elsewhere., according to market developments

One California single-family office executive told researchers that while early-stage deals can deliver windfalls, “this only happens 20 to 30% of the time. The trick is to minimize the number of failures.”

Broader Risk-Off Sentiment Takes Hold

The investment shift reflects a broader move toward conservative strategies among the world’s wealthiest families. The report found that 48% of family offices listed “improving liquidity” as their primary investment objective for 2025, followed by 33% who want to de-risk their portfolios.

This caution is further evidenced by declining return expectations. Average return expectations for 2025 have reportedly fallen to 5%, down significantly from 11% in 2024. Perhaps more tellingly, 15% of family offices now expect negative returns—a sharp contrast to last year, when almost none anticipated losses.

The research was based on 317 survey responses from single- and multi-family offices worldwide, including 141 in North America, collected between April and August. The North American families surveyed held an average of $2 billion in total wealth and managed $1.5 billion in assets.