Don't chase, structure

Here is a stat that should keep any wealthy family up at night: over seventy percent of family wealth disappears by the third generation. Gone. Why? Because most families invest like it's 1985, not like a family office operating today. That number comes from the literature around Family Wealth, James Hughes's classic on legacy planning, and it frames the only question that matters at the start: do you actually know what your money is doing right now?

Let me tell you where I come from, because it explains why I care. I started as a scrappy entrepreneur in Quito, Ecuador. My father, an Iranian immigrant, built the first fast food chain in the city, and I grew up watching hustle, adaptation, and integrity in real time. We didn't come from generational wealth: we built it from scratch. Babson College, a health food brand built from the ground up, an exit in 2019, and then my own family office, A9, which grew into Infinity⁹ when other investors kept asking to co-invest. If there is one lesson threaded through all of it, it is this: wealth without a strategy is a liability. And most people don't lose their money because they took on too much risk. They lose it because they didn't understand the risks they were taking.

The legacy model is broken

Someone I know exited a startup with eight figures in cash and went straight to a big-name private bank. The asset managers put him into a model portfolio: mostly global equities, some bonds, and a slice of alternatives that really just meant REITs and hedge funds. A year later the returns were underwhelming, he paid more in taxes than he earned in alpha, and, worst of all, he had no idea what he actually owned. The spreadsheet looked good. The real world didn't. That is the legacy model: passive capital, cookie-cutter allocation, no creativity, no control, and an unspoken assumption that you don't want to be involved.

The family office approach starts with different questions. What is the structure behind this investment? Who controls the deal? Who gets paid first? Is my risk capped, is my upside protected? After my own exit I met three different wealth managers, and not one asked about my risk tolerance, my liquidity needs, or any goal beyond market-rate returns. That is when I realized I needed to think like an institution but act like an entrepreneur. A family office doesn't just manage money: it allocates capital with purpose. You build your own framework, structure deals your own way, create your own preferred returns and downside protection. On one of my early deals, a small apartment building, I didn't just buy in: I structured a preferred equity stake with a defined annual return and a kicker if the exit cleared a threshold. And I set up an internal investment committee, even when it was just me and a CPA, grading every deal on risk, control, and cash flow.

Four buckets and real deals

Structured allocation is wealth architecture. Think of your capital like building a house: you would never hand a random contractor a check and say surprise me. You start with a blueprint, and every room has a purpose. When I first did this, I drew four buckets on a whiteboard, and it completely changed how I saw my own money. Core real estate: stable, cash-flowing properties with tax benefits. Structured debt: short to mid-term lending, collateralized, predictable yield. Active equity: operating businesses and assets where I can negotiate terms. And opportunistic: the moonshots, land entitlement, distressed credit, early-stage bets, deliberately the smallest room in the house. Label every dollar by its job, growth, income, protection, or legacy, and assign each deal to a bucket. The clarity is immediate.

The deals show why structure beats chasing, and I am describing the shapes rather than the transactions, because the details belong to the people who were in them. A short-term bridge loan on a commercial asset: solid collateral at conservative loan-to-value, a motivated borrower, and a personal guarantee layered in. That is not just yield: that is asymmetric risk-reward. A mid-sized multifamily that nearly fell apart because it needed significant capex and buyers kept passing, restructured as a joint venture with the operator, with our capital entering as preferred equity carrying an annual return plus a share of the upside above a threshold. What I will say about that one is not the outcome but the reason it was survivable at all: we structured it before we funded it, so the shape of a bad year was known before there was any chance of one. In Latin America, a financing syndicate for undervalued, cash-flowing agribusiness land that locals couldn't finance, with an equity participation clause: the operator got capital to scale, and investors got secured returns plus upside.

The honest footnote, because a list of deals you chose to tell is not a track record: structure improves your position, it does not make you right. I have been in deals where every provision worked exactly as written and the outcome was still mediocre, because the market moved and no clause fixes that. Structure changes who absorbs the damage and in what order. It does not decide whether there is damage. Every figure and shape here is illustration, not promise. The principle is the constant: don't chase returns. Chase structure that creates returns. Ask for deal memos. Read term sheets closely. Focus on control provisions, priority payouts, and tax treatment.

The committee of two

This is what the runtime didn't get to teach, and I add it here as the extended class: how to run an investment committee when your family office is you and maybe one trusted professional. The tool is a one-page deal memo, written before every commitment, and it has six sections.

One: the thesis, in two sentences a teenager could understand. Two: the bucket, which of your four rooms this deal lives in, and what job it does there; if you can't assign it, that is a finding, not a formality. Three: the seat, exactly where you sit in the capital stack and who gets paid before you. Four: the downside math, what happens at meaningfully lower income or a delayed exit, in numbers, not adjectives. Five: the exit, how and when you get out, and what it costs. And six, the section that makes it a committee instead of a diary: the dissent. One honest paragraph arguing against the deal, written by you or, better, by your CPA, lawyer, or a trusted friend with permission to be harsh. The rule is simple: no memo, no wire. And no memo is complete with an empty dissent section, because a deal nobody can argue against is a deal nobody has thought about.

Then close the loop the way the strongest families do: keep every memo, and once a year reread the old ones next to what actually happened. Keep the losers in the file. An archive that only holds the deals that worked teaches you nothing, and it is exactly how people convince themselves they have a process when what they have is a good memory for wins. That archive becomes your family's case-study library, the raw material for the education that beats any trust fund. Two people, one page, six sections. It will not make you institutional overnight. It will make you un-foolable at the moments that matter.

The mirror

Imagine two families, each with fifty million in assets. One hands the kids a trust fund and no education. The other brings them into investment meetings, explains the structures, writes a family mission. One becomes a cautionary tale; the other becomes a dynasty. I have worked with families who built exactly that second version: investment memos, family retreats, case studies on past deals, and eventually a generation that allocates on its own rather than waiting to inherit a balance. Because legacy isn't about money. It's about capacity: the capacity to steward, invest, and evolve. Practical versions of this cost almost nothing: a family investment constitution, a short recorded explanation after each major allocation, a quarterly call with heirs.

So here is the mirror question: if your children inherited your portfolio tomorrow, would they inherit a strategy, or just a spreadsheet they don't understand? The answer decides which side of the seventy percent your family lands on.

If you want to keep this conversation going each week, there is The Sunday Memo. Think differently, allocate smarter, build long-term wealth.

Founder of Infinity⁹. Here I write in my own voice.