Super-rich with family offices hiring away experts, other creative stars

By Howard Chua-Eoan

The vanishings keep on happening. Chefs who have run wonderful restaurants fold their operations and disappear from the world of haute public dining rooms. It’s happened in New York and in London in my experience. I’m sure you’ve noticed it too wherever you are a regular — or were, until the chef up and left.
 

You then hear rumors. So-and-so has been snagged by a billionaire. You see an occasional post on social media clueing you in to said chef’s new lifestyle: no more endless nights bent over bookkeeping, no more customers who think orange wine is made with citrus, no more no-shows, no Yelp. 

I’d once in a while get a glimpse into these new lives: a surreptitious Instagram post from a private party in some inaccessible Manhattan tower; an off-the-record walk through the enormous kitchen of a private townhouse; or just a note about how wonderful it is to be picking herbs in a lovely estate you knew the cook could never afford. 

This is an option nowadays not not just for chefs burned out by the daily grind of restaurants, but accountants, investment advisers, personal shoppers, nurses, veterinarians and security guards. It’s not a bad life. These are experts whose services have become exclusive to the super-rich who can afford to wall away them away from the rest of the world.

While non-disclosure agreements keep the specifics of these positions confidential, there are semi-exclusive hires that give a sense of why they can be attractive. I’ve known Liam Nichols for a few years now. He’d worked at Momofuku Ko in New York City and Tom Kerridge’s restaurant at the Corinthia Hotel in London — excellent pedigrees. He was also a warm and wonderful presence wherever he cooked. Then, one day, like the unnamed chefs above, he vanished.

For months, the photographs he posted on social media were excruciating. There he was on a beach in the Caribbean, or kitesurfing on the bluest waters, soaking up the sun by a sailboat, sporting a smile so broad it was practically solar itself.

Had he come into money? In a way, he had: Liam had been hired to cook for the billionaire Richard Branson, founder of the Virgin Group, on 74-acre Necker Island, which he owns in its entirety, in the British Virgin Islands. Sometimes, Liam would prepare meals for Branson’s visiting neighbor, Larry Page, the co-founder of Google, and owner of Eustatia, the island next door — as well as for other rich guests at the Necker resort (where the cost is upwards of $3,700 per night per room).

Giving up on a public-facing existence is becoming more of an option nowadays. The market for  privatized services is growing because there are a lot more deep-pockets everywhere. Forbes says that millionaires control about a quarter of the world’s $431 trillion total wealth. That’s roughly $105 trillion, more than the combined GNP of the US, China, Japan, Germany and India. The total population of those countries: about 3.3 billion people. The number of millionaires in the world: 62.5 million, according to a 2022 Credit Suisse report. That statistic is expected to grow 40% by 2027. The richest 25 families in the world alone control more than $1.5 trillion.

For people used to — and tired of — working against layers of bureaucracy toward some merciless corporate bottom line, it is liberating to have only one real task: to make a wealthy owner (and his or her family and friends) happy.

Still, to borrow from F. Scott Fitzgerald, the rich are different not just from you and me but from each other. There are mere millionaires and then there are “ultra-high net worth individuals” — people so wealthy their families can operate as virtual fiefdoms.

To qualify for the lower end of the category, you need a net worth of $30 million. Even that may not be elite enough to manage your wealth through a family office — a dowdy term that belies the assets involved. To be able to staff the operation, the usual estimate is a net worth of $50 million. There are now about 8,000 single-family offices in the world. Most are in the US and Canada, where many of the richest people in the world reside.

Even as 85% of the world’s humans live on $30 a day, the rich proliferate everywhere — as do their family offices. Singapore had 50 family offices in 2018 but 1,100 now (and that may be an underestimate, according to my colleague Andy Mukherjee). The city-state and the United Arab Emirates are magnets for the burgeoning market of regional plutocrats looking to sweep up financial expertise to manage their private wealth.  Apollo Global Management Inc. has joined the scrum of financial giants (including Blackstone Inc. and KKR & Co.) offering expertise to the world’s UHNWIs and their family offices.

That kind of wealth management doesn’t just mean making more money but spending it — from investing in philanthropic and environmental causes, to mitigating the scale of a clan’s conspicuous consumption, to paying the salaries of service providers — OK, servants. In a related phenomenon, pop stars who would never have thought of performing at bar mitzvahs, weddings and birthday parties are now doing so-called “privates” because of the many customers able to afford their once forbiddingly exorbitant prices.

Members of the new servant class can benefit tremendously from bidding by the rich for the best in class. For example, chefs who have run critically acclaimed restaurants can pick and choose the private homes they’d rather work in. So can nannies — and chauffeurs and butlers, veterinarians and nurses, tailors and number crunchers. The advantages can be enormous. 

Those considerations can be trumped by one thing: the unhappiness of your super-rich masters. The only way to shield yourself from the ire of your employer is a well-written contract. You can’t depend on the regulations that protect most workers in a corporation. And forget about labor union guarantees.

Happiness is a fleeting thing — and it is especially fickle among people who believe they personally control everything via money spigots. You don’t have to work for them to know this. I used to hang with some very rich friends, and one day I jokingly disagreed with them. Or I think that was my transgression. I can’t really tell. All I know is that the annual invitation to their villas by the sea no longer comes in the mail. Sigh. 

Liam didn’t make his billionaire employer unhappy. But preparing shepherd’s pie (Branson’s favorite dish) wasn’t going to get him into any culinary hall of fame. Liam left the world of the super-rich after six months and returned to his roots in Norfolk, where he opened a small five-table restaurant called Store in Stoke Mill. He works very hard at all the things that make restaurants difficult. But he is happy. He just won a Michelin star. 

Disclaimer: This is a Bloomberg Opinion piece, and these are the personal opinions of the writer. They do not reflect the views of www.business-standard.com or the Business Standard newspaper