Private Equity in Family Portfolios: A Diversified Investment for Generational Wealth Building

By: Michael Christian, CFA®, CAIA®, Founding Partner at EverPar

Key Takeaways:

  • Private equity has historically outperformed public markets and can help preserve wealth over time.
  • Family stewards can access a broader universe of investment opportunities beyond public markets for true portfolio diversification.
  • Private equity’s tax-efficient capital gains help preserve generational wealth.
  • The long-term private equity investment approach aligns naturally with families’ thinking in generational terms.

For over two decades, I’ve had conversations with family stewards who often ask me the same fundamental question: How might we preserve and grow generational wealth while potentially minimizing what we lose to taxes and fees? Our clients, who typically manage family foundations, trusts, and businesses, understand that relying solely on public markets may not provide the diversification and tax efficiency that could help build lasting legacies across generations.

This is one reason why we often consider incorporating private equity into our wealth management approach. Despite its complex reputation, private equity can be relatively straightforward to understand. It involves investing in companies not traded on public stock exchanges. Through our private equity investments, EverPar clients have had the opportunity to gain exposure to companies like SpaceX, Coinbase, and Airbnb.

What makes private market investing compelling for the families we serve is its potential to deliver performance that exceeds inflation and provide the steady, long-term growth essential for generational wealth building.

Private equity offers compelling advantages for our clients’ portfolios, delivering benefits unavailable in traditional public markets.

Historically, private investments have outperformed public companies. While stocks have generated 8.2% in annual returns over 25 years, private equity has delivered 12.7% over that same period.[1] Historical outperformance (while not guaranteed) reflects the active management and operational improvements that private market fund managers bring to their portfolio companies.

Private equity investments often generate gains through long-term capital gains rather than ordinary income. Long-term capital gains rates typically run lower than income tax rates, potentially meaning a more favorable tax treatment for the families we serve. These positions may also enhance after-tax returns compared to income-generating investments.

In the United States alone, there are over 17,200 private companies with revenues greater than $100 million, compared to fewer than 4,000 public companies total.¹ For context, 87% of all US companies with revenues over $100 million are privately held.² The number of public companies has declined significantly from over 7,000 in 1996 to fewer than 4,000 as of 2020, while the private market has continued to expand.³

If we want to give our clients the best opportunities, why limit them to investments only in public markets? Private firms may offer diversification not typically found in public markets and often include businesses that could have strong fundamentals, low volatility, and more paths to value creation. Private equity has historically delivered strong performance, with the CA US Private Equity Index showing 15.0% annualized returns over 10 years compared to 13.0% for the S&P 500.⁴

Many investors achieve diversification by spreading their holdings across different sectors within the stock market. However, for families looking to maximize diversification opportunities, limiting investments only to public markets may not capture the full range of available investments. Expanding beyond public markets can provide access to a broader universe of companies and investment strategies that may complement a well-diversified public market portfolio.


[1] Return data for the 25-year period ending June 30, 2024 https://www.cambridgeassociates.com/private-investment-benchmarks/#current-benchmark-statistics


At EverPar, we utilize three core strategies to help many of our clients access this asset class. Each strategy is designed to potentially optimize returns while helping to manage risks.

We partner with proven private equity firms like Blackstone, Oaktree, and Apollo. The capital we provide helps our partners acquire a stake in private companies on our clients’ behalf. Using a rigorous due diligence process, we choose managers with strong track records and expertise to execute value-creation strategies.

We purchase existing fund interests from other investors looking for immediate liquidity, often at a discount to net asset value, helping provide immediate benefit from the discounted value and access to future appreciation.

Our longstanding partnerships with fund managers and our ability to meet investment minimums enable us to co-invest directly in specific companies alongside our partners. Co-investing gives our clients targeted exposure to individual businesses rather than broad fund portfolios. Since co-investors typically avoid standard management fees and carried interest charges, this strategy often results in a more cost-effective fee structure for our clients.


Before incorporating private equity into your family’s portfolio, there are several key differences from traditional investments that are essential to understand:

  • Liquidity: Traditional private equity funds typically lock up investor capital for 7-10 years with limited liquidity options, making committed capital generally unavailable for other opportunities or unexpected needs during the investment period. However, we provide families access to both traditional PE structures and certain private equity solutions that may accept monthly subscriptions and offer quarterly tender opportunities, subject to fund terms and conditions. These alternative structures may allow participation in private equity while potentially maintaining greater flexibility over capital access. We help families evaluate how different PE approaches might fit within their overall asset allocation, considering their liquidity needs and investment objectives. 
  • Valuations: Unlike stocks that fluctuate daily, fund managers typically value private companies quarterly or even less frequently. These less frequent valuations create smoother yield patterns with less apparent volatility, but don’t provide real-time valuations like you do with stocks. The reduced volatility can be psychologically easier for some investors, but the underlying business risks still exist; they’re just not reflected in daily price movements.
  • Due diligence: Private markets don’t have the same reporting requirements and analyst coverage as public businesses. Information is less readily available, making thorough research and professional guidance essential. Our experience in private markets means we know what questions to ask and how to identify potential red flags that might not be apparent to individual investors.
  • Value creation: Private investments often show flat or even negative returns in the initial years due to management fees, carried interest structures, and the time required to implement operational changes. However, patient investors may realize substantial growth in later years as portfolio companies mature and managers execute exit strategies. Understanding this effect is crucial for setting appropriate expectations and maintaining confidence during an investment’s early years.
  • Investor qualifications: Private equity investments are typically limited to qualified clients who meet specific financial thresholds. These requirements are designed to ensure investors can withstand the risks and illiquidity that come with private market investments. We work with clients to evaluate whether they qualify for these investments and if they align with their overall financial situation and goals.

FeaturePublic market investmentPrivate market investment
LiquidityDaily trading, immediate exit availableMonthly entry, quarterly liquidity options available
Minimum investmentAs low as $1 per shareTypically $250k-$1M+
ValuationReal-time, continuous pricingQuarterly or less frequently
VolatilityDaily price fluctuations Less frequent pricing reduces perceived volatility
Information availabilityExtensive public reporting and analyst coverageLimited disclosure and reporting of information
Exit strategySell anytime during market hoursDependent on the fund manager’s exit strategy and timing

Private equity represents just one component of our comprehensive wealth management approach, which we bring to every client relationship. As your forever partners, we understand that each family’s situation is unique, and we tailor our private equity recommendations to align with your specific goals and timeline.

If you’re new to EverPar and curious about how private equity might fit into your family’s generational wealth strategy, schedule your Foundation Session today. We’ll walk you through how EverPar can help you navigate the complexities of generational wealth while exploring investment strategies designed to build a legacy that lasts.

Michael Christian, CFA®, CAIA® is a Founding Partner at EverPar


Sources[PO1] [CD2] :

¹ Morgan Stanley, “The Growing Opportunity in Private Markets,” based on search results showing over 17,200 private companies in the US with annual revenues greater than $100 million.

² Advisorpedia, “Number of Public Companies v. Private: U.S.”

³ Tuck School of Business at Dartmouth, “Where Did All the Public Companies Go?“

⁴ Cambridge Associates, “Private Investment Benchmarks,” periods ended June 30, 2024.


EverPar Advisors LLC (“EverPar”) is a registered investment advisor. Diversification does not ensure profit or guarantee against loss. Past performance shown is not indicative of future results, which could differ substantially. An investment in the private investments involves significant risks and is suitable only for those persons who can bear the economic risk of loss of their entire investment and who have limited need for liquidity in their investment. There can be no assurance that the investment will achieve its investment objective. An investment in the private investment carries with it the inherent risks associated with the underlying investments. Each prospective investor should carefully review the Confidential Offering Memorandum and Limited Partnership Agreements before investing. The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.

The Proactive Approach to Legacy Planning: Why Documents Alone Aren’t Enough

By: Tim Koski, CIMA®, Founding Partner at EverPar

Key Takeaways

  • Defining your family’s core values might help align financial decisions with what matters most
  • Legacy planning often benefits from coordination between your financial advisor, estate attorney, tax professional, and family members
  • Consider engaging your children in legacy discussions before age or health creates urgency
  • EverPar is here to support your proactive approach to legacy & estate planning

At EverPar, many clients come to us focused on “the here and now.” Whether it’s managing your current financial situation, planning for retirement, or figuring out how to best utilize your assets in alignment with your goals and values.

While these immediate concerns are undoubtedly significant, I’ve observed that families who build lasting legacies often take the time to think beyond their lifetimes. They tend to understand that wealth management isn’t just about growing numbers on a statement—it’s about potentially ensuring their deepest values guide financial decisions, especially when passing the torch to the next generation.

Let me share a story about a real client situation. I’ll alter specific details to support confidentiality, but the story remains a powerful one to understand.

When “John” engaged EverPar to help manage his estate, we discovered his attorney had structured most of it to flow to a family foundation controlled by the attorney and an unrelated advisor, which was not the client’s actual intention. What’s even more notable is that while he thought he had a $40 million estate, he actually had $80 million to potentially distribute to his beneficiaries.

Within 30 days, we coordinated with a new attorney to amend the trust. Instead of $60 million going to the foundation, only $10 million did. The remaining funds were redirected where the client intended: to “John’s” children, grandchildren, great-grandchildren, his partner, brother, extended family, and even his housekeeper and gardener.

Without a coordinated approach to identify and address this misalignment, this client’s true intentions and his family’s financial future could have been compromised.

This story illustrates a consideration about legacy planning: creating documents and assuming they’ll work as intended might not be sufficient. Estate plans often benefit from ongoing attention, regular reviews, and clear communication with the people who will be affected by them.

Many families discover misalignments in their planning only after it may be too late to make corrections. The difference between reactive and proactive legacy planning could potentially impact whether your true intentions are honored or get lost in legal complexities.

We often encourage our clients to consider legacy planning as an ongoing conversation rather than a one-time event, and to think about creating a framework that might evolve with your family’s changing circumstances while staying true to your core values.

While it may feel difficult to talk about a future without you, involving your children, nieces and/or nephews in your legacy plans today might help ensure they aren’t blindsided by whatever could happen in the future.

For clients at EverPar, we’re here to support. This engagement might include discussions about:

  • Estate planning and wealth transfer – Consider helping them understand what they might inherit and how their inheritance could support your family values
  • Business succession planning – Next-generation family members might benefit from understanding their potential role and responsibilities in the family business
  • Philanthropic goals – You may want to share your charitable intentions and consider how younger family members might want to contribute to causes that matter to them
  • Financial education – Consider preparing your children to handle wealth responsibly, whether managing personal finances or stewarding family assets

As you think about your family’s generational wealth transfer, there are questions worth potentially discussing during a meeting with your EverPar advisor. These conversations might help ensure your needs are being addressed and that family members understand their potential role in preserving your family’s wealth and values.

Here are some questions I often pose to clients when having these conversations:

  • How might we better prepare the next generation to be thoughtful stewards of your family’s wealth and values?
  • What family stories and values do you want to consider passing down along with financial assets?
  • Are your current estate planning documents aligned with your latest wishes and family circumstances?
  • What opportunities might exist to involve the next generation in your family foundation or charitable giving?
  • How should we potentially structure conversations about wealth transfer to prepare your heirs without overwhelming them?
  • What additional family members should we consider building relationships with to help ensure continuity?
  • Are there family business succession planning elements we might want to address more proactively?

At EverPar, we understand that wealth can be a tool to create a better life for the people you care about most, today and for generations to come. Our greatest satisfaction often comes from watching families use their resources to enrich lives in meaningful ways, which might include funding education, supporting causes they believe in, and providing security for future generations.

If you’re stepping into the role of managing family wealth or want to explore whether your legacy plans truly reflect your values, we’re here to help. Our Foundation Session is designed specifically for families who may be navigating these important transitions. Contact us to learn more about this first meeting.

Tim Koski, CIMA®, is a Founding Partner at EverPar

EverPar Advisors LLC (“EverPar”) is a registered investment advisor. Diversification does not ensure profit or guarantee against loss. Past performance shown is not indicative of future results, which could differ substantially. An investment in the private investments involves significant risks and is suitable only for those persons who can bear the economic risk of loss of their entire investment and who have limited need for liquidity in their investment. There can be no assurance that the investment will achieve its investment objective. An investment in the private investment carries with it the inherent risks associated with the underlying investments. Each prospective investor should carefully review the Confidential Offering Memorandum and Limited Partnership Agreements before investing. The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.

Estate Planning: Understanding the Power of Attorney

By Courtney Hoffman, CFP®, AAMS™

Life is unpredictable. The more prepared you are for unforeseen circumstances, the better.

A Power of Attorney (POA) is a legal document that grants someone you trust the authority to act on your behalf in financial, medical, and legal matters should you become incapacitated.

We’ve answered common questions about powers of attorney to help you understand their significance—and necessity—in estate planning.  

A power of attorney is a legal document that allows you (the principal) to legally designate an agent to manage specific aspects of your life should you become unable to do so yourself. The authority you grant can be broad or limited to specific tasks, such as buying or selling property, investing money, paying bills, or making medical decisions. A POA ensures that your wishes for your affairs are carried out if you become seriously injured, ill, or otherwise incapacitated.

There are several types of powers of attorney, which provide varying levels of authority to your agent. Your estate planning attorney can help you determine which POAs align best with your needs and intentions and guide you through creating and managing these documents.

General Power of Attorney: This POA grants broad authority to your agent to act on your behalf in all situations permitted by state law. General POAs typically terminate in the event of your incapacitation.

Durable Power of Attorney: Unlike a general POA, a durable POA remains in effect if you become disabled or incapacitated, ensuring continuity in managing your affairs.

Financial Power of Attorney: This POA gives your agent authority to oversee matters related to your finances, businesses, and property when you cannot.

Medical Power of Attorney: Also known as a medical proxy, a medical POA allows your agent to make healthcare decisions if you cannot communicate your wishes regarding emergency, end-of-life, and other medical treatments.

Limited Power of Attorney: This POA restricts your agent’s authority to specific tasks (such as selling property or filing taxes) or periods of time. For example, if you are traveling out-of-country for six months, you can create a limited POA that expires when you return.

Springing Power of Attorney: As the name implies, a springing POA clearly defines a triggering event or level of incapacitation that must occur before it goes into effect.  

A POA serves as a safety net in the event of major accidents, illness, or incapacity. Without a POA, your loved ones may face lengthy and expensive court proceedings to gain the authority to manage your affairs. This process is stressful and may lead to unnecessary conflict between family members. Establishing a POA ensures that a person you trust can take over, act in your best interests, and protect your family’s financial security.

Selecting the right person to act as your agent is crucial due to the significant authority and responsibilities they must take on. Whether it’s your spouse, an adult child, a close friend, or a professional, your agent should be someone whom you trust implicitly, who understands your values, who is capable of handling your finances and other affairs, and who will diligently execute your wishes.

Power of attorney can be terminated by writing a letter that expressly revokes it and delivering it to your agent. Some states require that you have the letter notarized. Unless durable, your POA  will automatically end upon your incapacitation or set termination date—and all POAs terminate when you pass.  It’s important to review your POA (and other estate planning documents)  periodically and inform your attorney of changes in your family’s circumstances or if your agent no longer meets your needs.

The best time to establish a POA is now, while you are healthy and able to make decisions. Waiting until a crisis arises can complicate the process and limit your options. A POA is not solely for older individuals or those with significant assets; it is a vital tool for anyone who wants to ensure their affairs are managed according to their wishes.

EverPar can work with you and your attorney to incorporate POAs into your estate plan and help protect yourself, your loved ones, and your wealth.

Let’s talk about all of your estate planning needs.

Sources:
https://www.investopedia.com/terms/p/powerofattorney.asp
https://www.freewill.com/learn/5-types-of-power-of-attorney
https://www.americanbar.org/groups/senior_lawyers/resources/voice-of-experience/2010-2022/pick-right-power-attorney-instrument

EverPar Advisors LLC (“EverPar”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where EverPar and its representatives are properly licensed or exempt from licensure.

All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed.  There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.

 The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status, or investment horizon. You should consult your attorney or tax advisor.

 For additional information, please visit our website at https://everpar.com/.

Legacy Planning: Charitable Giving

Engaging in philanthropy allows you to make a positive impact on your community, instill essential values in your children, and create a legacy for your family.

So, it’s no surprise that the popularity of charitable giving in the U.S. has surged, with 83% growth over the last twenty years when adjusted for inflation.1

However, it can be challenging to know where to begin. Let’s explore three potential tax-efficient charitable giving strategies to consider as part of your legacy planning.

In addition to strengthening family bonds and supporting important organizations and causes, charitable giving can also offer certain financial and estate planning advantages.

There are numerous ways to give, so it’s important to solidify your family’s philanthropic goals, consider the tax impacts of different options, and work with your financial advisor to choose the plan that makes the most sense for you and your loved ones.

To help you get started, here are three strategies to consider:

A donor advised fund is a flexible giving vehicle that allows you to make an irrevocable contribution of cash, stocks, or non-publicly traded assets to a charity—and become eligible for a tax deduction. Those funds can then be invested for tax-free growth, and you can recommend grants over time to other IRS-qualified 501(c)(3) public charities as you see fit.

If you and your loved ones are passionate about the same organization, you can set up a donor advised fund in the name of your entire family—or create separate DAFs for your children and grandchildren to support their unique philanthropic interests and goals.

A key advantage of this giving strategy is the tax benefits associated with donor-advised funds. For instance, you can claim an immediate tax deduction of up to 60% of your adjusted gross income (AGI) when you fund a DAF with cash.2 This can be particularly helpful in years where you experience higher earnings or receive a significant year-end bonus.

Additionally, if you donate long-term appreciated assets (such as securities) to your DAF, you can:

  • Become eligible for an income tax deduction of the full fair-market value of the asset, up to 30% of your AGI
  • Potentially reduce or eliminate capital gains
  • Maximize the amount the charity receives2

Embracing charitable trusts can be a tax-advantageous way of meeting your estate planning and philanthropic goals. There are two primary types of charitable trusts: charitable remainder trusts (CRTs) and charitable lead trusts (CLTs). Both are irrevocable and distribute assets to your charitable or non-charitable beneficiaries at the end of the trust term or when you pass.

A charitable remainder trust may be a good fit if you want to take an immediate charitable deduction—or if you or a loved one would benefit from an income stream during the trust term. You can establish a CRT during your lifetime or at your death, which allows you to financially support your heirs, with the remainder going to your designated charities. Additional benefits may include:

  • Claim a charitable deduction against the income or gift tax for the present value of trust assets that will be transferred to the qualified charity.
  • Diversify your investments by transferring low-basis assets to the trust and eliminating income or capital gains tax when the assets are sold. However, your non-charitable beneficiary must pay tax on the income received.
  • Preserve the full value of the highly appreciated property you contribute to the trust (because the trust will be exempt from tax when it sells them).1

A charitable lead trust generates a potential income stream for your charitable beneficiary during the trust’s lifetime. Then, the remaining assets are passed on to your loved ones when it terminates. Unlike CRTs, CLTs are not tax-exempt but may be ideal if you wish to transfer appreciated property to your heirs while mitigating the burden of gift and estate taxes. Other advantages may include:

  • With a non-grantor lead trust, the trust pays tax on the income and claims a charitable deduction for the amount paid to your designated charity, which can help minimize transfer taxes.
  • With a grantor lead trust, you may take an immediate charitable contribution deduction for the present value of the future income stream (subject to limitations), but the investment income is taxable to you during the lifetime of the trust.
  • The assets used to fund a CLT are removed from your estate, which can mitigate estate taxes when you pass and preserve wealth for your heirs.1

If you’re looking for greater flexibility, you can name a public charity that sponsors a DAF as the beneficiary of your charitable trust. Because charitable trusts are irrevocable, making changes is difficult and costly. However, incorporating a DAF makes it easier to adjust how and when you give.

Establishing a private foundation may be a good strategy if you’re willing to invest your time—and a substantial initial gift—to create an enduring family legacy. Private foundations are typically overseen by boards of directors or trustees tasked with receiving donations, actively managing and investing charitable assets, sponsoring fundraising events, and making grants to other charitable organizations. This provides an opportunity for your loved ones to work for or serve as members of the governing body of your foundation.

Considerations unique to private foundations include:

  • If you follow proper IRS procedures, you are not limited to supporting only 501(c)(3) charities, which means you can support philanthropic interests undertaken by individuals, scholarship programs, and other nonprofit organizations.
  • Non-publicly traded contributions may only be deductible at fair market value (not fair market value).
  • Charitable deductions are limited to 30% AGI for cash contributions and 20% AGI for long-term publicly traded appreciated securities.
  • Unlike with donor advised funds where you can remain anonymous, donations to private foundations are public.
  • Private foundations are exempt from federal income tax, but investment income is subject to a 1.39%  excise tax.3

Setting up a private foundation involves ongoing and complex administrative, legal, and reporting responsibilities, so it’s critical to factor this into your decision-making. Additionally, the upfront costs and tax treatments associated with private foundations may be less advantageous than other giving strategies.

Charitable giving enables you to make a difference in the lives of others, empower philanthropy in the next generation, and reinforce what matters most.

We can answer your questions, walk you through potential implications of different options, and help you choose a tax-efficient charitable giving strategy that aligns with your family’s goals.

Let’s discuss your vision for your legacy.

Sources

1 https://www.fidelitycharitable.org/content/dam/fc-public/docs/advisors/charitable-planning-guide.pdf
2 https://www.fidelitycharitable.org/guidance/philanthropy/what-is-a-donor-advised-fund
3  https://www.fidelitycharitable.org/guidance/philanthropy/private-foundations.html

EverPar Advisors LLC (“EverPar”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where EverPar and its representatives are properly licensed or exempt from licensure.

All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed.  There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.

 The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status, or investment horizon. You should consult your attorney or tax advisor.

 For additional information, please visit our website at https://everpar.com/.