Indian family offices sharpen due diligence: safeguarding $45B AUM amid startup surge

Indian family offices are sharpening their due diligence processes as they manage a rapidly growing $45 billion in assets under management (AUM), driven by a surge in startup investments and a sevenfold increase in their numbers since 2018.

The number of family offices has risen from 45 in 2018 to nearly 300 by 2024, reflecting a booming ecosystem. Sundaram Alternate Assets forecasts a 50% growth in AUM over the next three years, from $30 billion in 2024 to an estimated $45 billion by 2027.

This growth coincides with India’s expected fastest global rise in ultra-high-net-worth individuals (UHNWIs), projected to increase by nearly 50% from 13,263 in 2023 to approximately 19,908 by 2028, according to Knight Frank’s Wealth Report 2024.

Traditionally focused on established sectors, Indian family offices are now diversifying into emerging and high-impact industries such as semiconductor technology, robotics, space exploration, and renewable energy. This shift reflects a strategic move to capitalize on innovation-driven growth.

Given the high-risk and unstructured nature of early-stage startups, family offices emphasize comprehensive due diligence to evaluate alignment, feasibility, and risk exposure before committing capital.

“Comprehensive due diligence is essential for family offices to assess the alignment, feasibility, and risk exposure of a startup fund or venture,” industry experts note, underscoring the cautious approach amid rapid expansion.

This evolving landscape highlights the balancing act Indian family offices perform to safeguard their growing wealth while supporting the country’s dynamic startup ecosystem.

Indian family offices, managing $45 billion in assets, are intensifying due diligence amid a surge in startups and a sevenfold increase in their numbers since 2018. With a projected 50% AUM growth by 2027, they are diversifying into sectors like semiconductors and renewable energy to safeguard investments.