Family Office Setup Checklist

Getting the foundations right matters more than almost any investment decision you’ll make in the first few years. Here is the sequence I’d follow.

Phase 1: Legal & Structure

• Determine domicile (UK LLP, BVI, Cayman, Delaware — depends on tax residency and asset types)
• Appoint legal counsel with genuine FO experience (not just HNW private client)
• Establish investment holding entity and operating entity separately
• Draft an Investment Policy Statement (IPS) — this is the constitution
• Set up bank accounts: operating, liquidity reserve, investment gateway

Phase 2: Custody & Counterparties

• Select prime custodian (Pershing, CACEIS, Citi, SocGen — not a retail bank)
• Understand CASS rules if UK-based; AIFMD implications if managing third-party capital
• Establish FX execution arrangements — don’t accept custodian default rates
• Set up derivatives clearing if needed (ISDA/CSA)

Phase 3: Investment Infrastructure

• Define asset class scope and mandate clearly before doing anything else
• Establish valuation policy for illiquid positions
• Set up portfolio management system (Addepar, Masttro, or Bloomberg AIM depending on scale)
• Implement performance reporting cadence (monthly minimum)
• Define benchmark(s) — or consciously decide to be benchmark-agnostic

Phase 4: Governance

• Draft an Investment Committee charter, even if you are the IC
• Establish decision-making documentation process (Investment Memoranda)
• Set conflict-of-interest policy
• Define related-party transaction rules

Phase 5: Operations & Technology

• Implement a secure password and document management system
• Set up encrypted communications for sensitive discussions
• Establish accounting and tax reporting workflow
• Define disaster recovery / succession basics

This checklist is a starting point, not legal advice. The sequence matters as much as the items. Get custody wrong early and you’ll pay to unwind it.