Technology
For Family Offices, AI Is Both an Investment Theme and an Operational Test
Adoption of artificial intelligence tools and investments are rising across family offices.
Reported by Matt Toledo
Family offices are increasingly interested in artificial intelligence as both an investment theme and as an operating tool, although adoption and access to investment opportunities vary widely amongst different family offices. Family office surveys show growing interest in using artificial intelligence for research, reporting, risk analysis, manager selection, forecasting and other operational tasks.
Additionally, the rise of AI has led to an increase in cybersecurity risks for family offices, with these investors increasingly outsourcing cybersecurity to specialist firms.
Adopting AI
Family offices, like most institutional investors, are finding AI most useful for operational tasks, with humans making final decisions on things such as investments.
“In the investment management business, whether you are a family office or a wirehouse or [a registered investment adviser], I [think the] differentiator is how nimble you are as an organization,” says Matt Malone, head of investment management at private markets OCIO firm Opto Investments. “So single-family offices: probably pretty nimble, but probably not a lot of bandwidth. Multifamily offices maybe have a little more bandwidth to build this infrastructure and make it worth the investment to try to build out AI tools.”
Still, while AI adoption is increasing, it varies from firm to firm. According to a family office report from Citi, 22% of family offices reported automating some operating tasks or doing investment analysis with AI tools—up from 14% in 2024. Approximately 57% of family offices lack the internal expertise to adopt AI within their organizations, according to Citi.
A report from PWC noted that the market is crowded with vendors offering AI products for family offices.
“Partly as a result, many [family offices] are also adopting a ‘wait-and-see’ approach: one that involves continually watching out for tomorrow’s big game-changer—and inadvertently missing out on the useful things they could be doing with AI today,” the report stated.
Malone says family offices that have begun integrating AI have mostly stopped short of allowing it to call the shots.
“You just have to be aware of what the limitations of AI are: For deterministic tasks, it may not be the best thing, but it may still get you 80% or 90% of the way there,” Malone says, adding that investors are increasingly weighing the costs of the newest models of AI tools.
Cost is “becoming more of a focus area for some people: ‘How do we use this efficiently?’” Malone says. “The whole point is to maybe not [to] replace people, but [to] enhance people, but you [have] to look at what your cost is to do that. The technology is just evolving faster than most people have the bandwidth to really process, and we’re still yet to see what the future holds.”
Hiring for Talent in an AI Age
Jim Besaw, CIO of multifamily office GenTrust, says demand for staff with expertise in AI systems is growing.
“We have several family offices that have asked us in the past 12 months to help them find staffing … [to] help them figure out what AI should they be using to automate their lives,” Besaw says. “Everything from bill pay, concierge—all the stuff in the family office that would have normally been done by a team of five or 10 people—[they’re saying], ‘Help me find somebody that can find the technology that can help me do all that.’”
Citi’s report added that some family offices believe their analysts will be replaced by AI agents—employees would move from doing analytical work to managing AI processes and agentic workflows, shifting the skillsets required.
Still, humans will continue to be in the loop.
“You will never be able to automate the human connection and anticipation an intuitive adviser can create with a client,” says Jennifer Quent, director of family office services at accounting firm Kaufman Rossin. “At the end of the day, our clients want to be heard and cared for. You can program a robot to react in a certain way based off specific parameters, but in the end, it’s still a robot. We have all interacted with AI customer service bots on the phone and experienced frustrations and wasted time. Our clients still want to pick up the phone and talk to a real human or occasionally meet in person.”
Investing in the AI Theme
Despite AI investments being a top priority for family offices, few actually have direct private equity or venture exposure to the sector so far, according to a family office survey from J.P. Morgan.
Approximately 65% of family offices surveyed by J.P. Morgan reported they plan to prioritize AI investments, but at the same time, more than half reported no exposure to growth equity or venture capital. Additionally, 79% of family offices said they had no allocation to infrastructure, even as the asset class has served as the backbone of the buildout of hardware and software needed to build and run AI tools.
Family offices have increasingly turned to special purpose vehicles that offer access to coveted companies such as SpaceX, Anthropic and OpenAI. However, these SPVs are often layered with fees, and the validity of their access to the underlying companies—some of which are still private—has also come into question.
Besaw adds that despite slow take-up so far, family offices are increasingly looking at the “picks and shovels” of AI investment, as well as at related sectors, such as quantum computing.
Cybersecurity Risks
Citi’s report cited cybersecurity and privacy concerns as organizations’ third largest barrier to the adoption of technology and AI, held by 28% of family offices.
Cybersecurity functions are the third-most-outsourced functions by family offices, at 38%, according to J.P. Morgan’s survey, which also found that cybersecurity is the specific service that family offices need the most, at 32% of firms.
“Cybersecurity remains a top focus for family offices. The evolving landscape, shaped by global geopolitical tensions and rapid advances in artificial intelligence, has led to increasingly targeted and sophisticated cyber threats against businesses, individuals and families,” wrote Ileana van der Linde, J.P. Morgan Private Bank’s head of cyber advisory, in the firm’s 2026 global family office report. “Vigilance and proactive defenses are critical to safeguarding assets and family office operations.”
As family offices experiment with AI tools, experts note that managing the associated risks requires more than cybersecurity protections alone and requires clear oversight of and accountability for how AI is used in decisionmaking.
“At a minimum, the office should document the data inputted into an AI tool, keep a human in the loop with authority to override AI decisions, test the tool against known outcomes before relying on it, perform strong vendor diligence on security and data use, and maintain an audit trail showing what the model recommended and what the human decided,” says Kathryn Nadro, a partner in law firm Levenfeld Pearlstein. “You should always be able to reconstruct the human reasoning behind a decision.”