The End of Spray and Pray
Family office deal volume just hit a decade low. That's the best news in private markets.
Consider a composite that will feel familiar to anyone who has reviewed a family office portfolio in the past three years. A single-family office, call it a billion-dollar operation in the American Southeast, describes its portfolio construction as "disciplined diversification." In practice, that means thirty-odd venture commitments across four fund vintages, a dozen co-investments sourced from conference introductions, and a handful of direct positions the principal found through personal networks. The portfolio is broad. It is also unmanageable. Capital calls arrive unpredictably. Reporting from GPs varies in quality and timing. Several of the venture funds have marked up positions that will never produce distributions. When the exit window closes, the consequences of breadth without conviction become impossible to ignore.
Now look at the data. In the second half of 2021, family offices completed 2,871 fund investments worth a combined $217.9 billion. In the first half of 2025, according to PwC's Global Family Office Deals Study, they completed 186. The dollar value fell to $25.5 billion. Venture capital deal volume dropped nearly 20 percent in the most recent twelve-month period. And yet, over that same span, the total value of family office venture investments rose almost 40 percent.
The hypothetical office described above is becoming extinct. What is replacing it looks nothing like "disciplined diversification." It looks like conviction.
The signal in the silence
Those numbers come from PwC's Global Family Office Deals Study, published in late 2025, which tracked more than 20,000 family offices over a full decade. The collapse in fund investment volume is the headline, but the subtext is more revealing.
The decline in volume has coincided with an increase in deal size. PwC found that the share of medium-sized transactions ($25 million to $100 million) and large deals ($100 million to $500 million) reached multi-year highs. Fewer checks, but larger ones. Less coverage, but deeper conviction.
As PwC's analysts put it in their summary: family offices are prioritizing quality over quantity, concentrating resources where deep expertise and active engagement promise greater value.
What replaced the old model
The spray-and-pray era in family office venture investing was a product of specific conditions: near-zero interest rates that made capital cheap and opportunity costs invisible, a fundraising environment where access to "hot" funds felt like alpha in itself, and a generation of family office CIOs who had come of age in an era when private market allocations were still relatively novel. The logic was seductive. Write enough small checks and the power law will do the work.
Higher rates ended that logic. When capital has a real cost, every commitment needs to justify itself against a risk-free alternative that actually pays something. The offices adapting fastest have converged on a set of strategies that look nothing like the generalist playbooks of 2019 through 2021.
The first is direct investing at scale. Seventy percent of family offices are now engaged in direct investing, according to Citi's 2025 Global Family Office Report. BNY Wealth's 2025 study of 282 single-family offices found that nearly two-thirds expect to make six or more direct investments in the coming year, a 10 percent increase from those reporting having done so in the prior twelve months. The preference is no longer for early-stage moonshots. Growth-stage companies, specifically Series C and D rounds, command the strongest interest at 52 percent of respondents, reflecting a pragmatic calculation: enough traction to evaluate, enough upside to justify the concentration.
The second is the club deal. PwC found that 69 percent of family office transactions in the first half of 2025 were structured as club deals, investments made alongside trusted co-investors who share sector expertise and due diligence costs. The model allows offices with lean teams (Goldman Sachs reports that the typical family office investment team has fewer than five people) to access deal flow and operational insight that would be impossible to build internally. It also creates natural accountability. When three families are underwriting the same thesis, the discipline tends to be sharper than when a single office is writing a check based on a pitch deck and a warm introduction.
The third is secondaries, and this may be the most telling shift of all.
The patient capital advantage
Goldman Sachs' 2025 Family Office Investment Insights report, surveying 245 institutional family offices globally, found that 72 percent now invest in secondaries, up from 60 percent just two years earlier. The average discount across the secondary market has widened to 26 percent, compared with 17 percent in 2023. Endowments and foundations, pressed for liquidity, are selling. Pension funds with near-term obligations are selling. Family offices, with no outside investors and no quarterly redemption pressure, are buying.
This is the structural advantage of patient capital made visible. When other institutional investors are forced to divest quality assets at a discount because their own liquidity needs have changed, family offices can step in precisely because they answer to no one but the family. They bypass the J-curve. They acquire positions in mature, cash-flowing portfolio companies at prices that reflect the seller's distress, not the asset's value. And they can hold those positions across generations if necessary.
The secondaries surge is not a tactical trade. It is a philosophical statement about what family capital is for. As Goldman's Meena Lakdawala-Flynn observed, family offices possess the ability to invest in assets they can hold over multiple generations without worrying about an exit. That capacity, once seen as a quirk of the family office model, has become its defining competitive edge in a market where liquidity is scarce and exits are slow.
The private credit opening
A parallel shift is occurring in private credit. Goldman Sachs found that the proportion of family offices with zero exposure to private credit fell from 36 percent in 2023 to 26 percent in 2025. The average allocation rose from 3 percent to 4 percent, a 33 percent increase off the base. Direct lending yields of 8 to 9 percent, combined with senior positions in the capital structure and floating-rate instruments, have made private credit an increasingly natural fit for family offices seeking yield without the illiquidity risk of traditional private equity.
The appeal is structural, not cyclical. Private credit allows family offices to earn attractive risk-adjusted returns while maintaining a position higher in the capital stack than equity investments. In a rate environment where the old venture model of "invest and pray for an exit" carries real opportunity cost, the certainty of contractual cash flows has become a powerful draw.
BlackRock's 2025 Global Family Office Survey reinforced this trajectory: 32 percent of respondents intend to increase private credit allocations over the next year or two, the highest figure for any alternative asset class. Infrastructure is close behind at 30 percent, with three-quarters of family offices expressing a positive outlook for the asset class.
Alignment as the new currency
What connects direct investing, club deals, secondaries, and private credit is a single underlying principle: alignment of interests. BNY Wealth's 2025 study documented a 52 percent year-over-year increase in family offices citing alignment of interests as a crucial consideration in investment decisions. The number captures something that spreadsheets and IRR projections cannot: a growing refusal among family investors to place capital where they cannot see, influence, or understand the outcome.
This is the deepest break with the spray-and-pray era. The old model treated allocation as a statistical exercise. Write enough checks, maintain enough diversification, and the portfolio will converge toward some acceptable return. The new model treats every investment as a relationship that requires ongoing attention, operational involvement, and a shared sense of purpose between the family and the enterprise.
The shift has consequences for how deals get sourced. Conference-driven deal flow, where a principal meets a founder at an industry event and writes a check based on chemistry and a slide deck, is giving way to thesis-driven origination. Offices are building sector maps, identifying the specific problems they want to back, and then searching for the teams best positioned to solve them. The family's operating experience and industry networks become sourcing advantages rather than incidental background.
Goldman Sachs' data confirms that family offices continue to favor sectors with strong secular growth and business models that can transcend economic cycles. Technology remains the dominant conviction bet: 58 percent of surveyed offices expect to be overweight technology in the next twelve months. Eighty-six percent are invested in AI in some capacity. But the sophistication of the approach has evolved. These are no longer passive allocations to broad thematic funds. They are concentrated positions in specific companies where the family has an informational or relational edge.
What conviction demands
There is a tension in this story, and it connects directly to the operational argument this series has been building since January.
Conviction investing requires infrastructure that most family offices have not built. When an office writes thirty venture checks through fund vehicles, the GP handles reporting, valuation, capital call administration, and portfolio monitoring. When that same office makes six direct investments, structures three club deals, and manages a portfolio of secondary positions, it needs internal capabilities that look more like a small asset manager than a family's back office.
BlackRock's survey quantified the gap: 75 percent of family offices acknowledge shortfalls in private-market analytics, 63 percent in deal sourcing, and 57 percent in reporting. The very strategy these offices are pursuing, concentrated, direct, thesis-driven investment, is the strategy that places the greatest demands on operational technology, data aggregation, and reporting infrastructure.
This is the bridge between the operational thesis of Q1 and the capital deployment story of Q2. The Great Asymmetry is not just a back-office problem. It is an investment problem. An office that lacks the analytical infrastructure to monitor a concentrated portfolio of direct positions is not just operationally deficient. It is underwriting risk it cannot see.
The offices that have invested in their technology stack, built real-time reporting capabilities, and professionalized their operational infrastructure are the same offices that can afford to pursue conviction strategies with confidence. The 87 percent satisfaction rate that Deloitte documented among moderate and extensive technology adopters is not a coincidence. Those offices are not satisfied because they have better software. They are satisfied because the software enables the investment strategy they actually want to execute.
The Q2 thesis
For the past five articles, The Prominent Blog has explored the gap between how family offices invest and how they operate. We have examined the spreadsheet dependency, the cybersecurity exposure, the AI adoption paradox, and the technology stack that nobody audits. Those articles described a problem.
Starting now, this series turns to the opportunity.
The shift from spray-and-pray to conviction capital is the most consequential change in family office investing since the asset class went mainstream. It rewards the qualities that family offices possess in abundance: patience, sector expertise, long time horizons, and freedom from external mandates. It also demands operational capabilities that many offices still lack: real-time portfolio analytics, integrated reporting across public and private holdings, capital call planning, and the kind of data infrastructure that makes concentrated risk manageable rather than opaque.
The offices that close this gap will not just produce better returns. They will define a new model for what private capital can accomplish when conviction and capability are finally aligned.
This is the sixth installment of The Prominent Blog, a biweekly series on the convergence of capital strategy and operational technology in the family office sector.
Sources and verification notes:
All statistics cited in this article are drawn from identified, published sources:
Goldman Sachs 2025 Family Office Investment Insights, "Adapting to the Terrain": 245 institutional family offices surveyed globally; 67% with net worth of at least $1B; published September 2025. 72% invest in secondaries (up from 60% in 2023); average secondary market discount 26% vs. 17% in 2023; private credit zero-exposure rate fell from 36% to 26%; direct lending yields 8-9%; 58% expect to overweight technology; 86% invested in AI; investment teams typically fewer than 5 people; 39% plan to increase PE allocations; 34% plan to reduce cash. Confirmed via Goldman Sachs press release (Sep 10, 2025), CNBC (Sep 11, 2025), Crain Currency (Oct 17, 2025), Worth (Oct 2, 2025).
BNY Wealth 2025 Investment Insights for Single Family Offices: 282 SFO respondents; collaborative effort with Harris Poll; published June 2025. 64% expect to make 6+ direct investments in coming year (10% increase from prior year); 52% YoY increase in offices citing alignment of interests as crucial; growth-stage companies (Series C/D) preferred at 52%. Confirmed via BNY report PDF, Family Wealth Report (Nov 17, 2025), WealthBriefing.
Citi 2025 Global Family Office Report: 70% of family offices now engaged in direct investing. Confirmed via Family Wealth Report panel coverage (Nov 17, 2025).
PwC Global Family Office Deals Study 2025: 20,000+ family offices tracked globally; acquisitions, disposals and fundraisings July 2015 through June 2025. Deal volume in H1 2025 at decade low; fund investments peaked at 2,871 in H2 2021, fell to 186 in H1 2025; aggregate fund deal value peaked at $217.9B, fell to $25.5B; 69% of transactions structured as club deals; VC volume down ~20% yet value up ~40%; medium and large deal share at multi-year highs. Confirmed via PwC primary site, PwC Ireland, Fortune (Apr 11, 2025), Family Wealth Report, MrFamilyOffice.
BlackRock 2025 Global Family Office Survey: 32% intend to increase private credit allocations (highest for any alternative); 30% intend to increase infrastructure; 75% positive outlook on infrastructure; 75% acknowledge gaps in private-market analytics; 63% in deal sourcing; 57% in reporting. Confirmed via BlackRock press release (2025).
Previously verified in this series: Deloitte 2024 satisfaction data, 87% among moderate/extensive tech adopters vs. 66% among low adopters (Article 5).
