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AI, ML, and GPTs— we’ve all heard about these next-generation technologies that are completely transforming manual processes. The family office space is no different, with an abundance of investment management platforms, dashboards, analytics tools, reporting capabilities, and more in the industry.
Yet behind the scenes, the back office, which is the foundation of wealth stewardship, has remained surprisingly manual. The front office has a modern software vendor for nearly every use case, while the back office is still relying on Excel and other legacy solutions. What gives?
A recent UBS feature on SumIt Software brought this imbalance into focus. It highlighted an unsettling reality: approximately 75% of family offices still rely on accounting systems designed decades ago for entirely different use cases.
While wealth and portfolio management have sped ahead — especially with the introduction of so many new fintech platforms — we’ve seen that the core accounting and reporting tools family offices rely on have barely changed. But when the most critical backend systems still rely on faulty, manual software, it’s time for an upgrade.
UBS highlighted an important point and common frustration across the family office space: existing software simply wasn’t built for the way family offices work today.
Retail accounting tools are easy to use, but struggle to manage the 15, 30, or even 100+ entities that many family offices oversee. Corporate accounting systems, on the other hand, are powerful but overcomplicated. They’re often tailored for manufacturing and inventory management rather than wealth entities and trusts. This means hours of lost customization efforts and thousands of dollars spent on software features that the business will never use.
Then, there are specialized wealth management platforms, but those often take months to implement and don’t directly meet the needs of family offices — they’re most often built for boutique wealth management firms.
With this, family offices are forced into choosing the lesser of two evils: easy or capability. And when our industry manages the ultra-high-net-worth, quality and accuracy are non-negotiables. The UBS report makes clear that this compromise is no longer sustainable.
Our team at SumIt has interviewed more than 200 family offices to find out where the true technology gaps are, and what we found is that these gaps have effectively become barriers to modernization. In other words, this is holding family offices from reaching their full business potential.
Even with the rapid growth of fintech, most family offices still rely on Excel because existing software alternatives fail to meet their actual operational needs. The systems on the market today are either too limited, too complex, or too misaligned with how family offices function. So, it’s not that family offices don’t want better software, but that the current options make upgrading difficult and expensive.
Through this, we identified three characteristics that modern accounting technology must balance. UBS also highlighted these as essential requirements for the next generation of family office systems:
When these three traits come together, family offices get the full picture and complete control over their operations.
One of the most important insights in UBS’s feature was SumIt’s collaborative approach to development. Rather than building in isolation and based on assumptions, SumIt formed an advisory board of over 30 family office professionals, including principals, controllers, and CFOs, who shaped the platform based on their real-world experiences in their respective family offices.
This model reflects a takeaway lesson for the industry: the best solutions are built from partnerships. Family offices need software partners that build configurability directly into the platform, so customizations and unique cases are expected and welcomed.
Unlike other industries, a software partnership doesn’t imply bespoke customization for every client or, in our case, family office. Rather, it means configurability that reflects how family offices actually work, which is informed by hundreds of hours of input from those already doing the job. In practice, that means flexible entity structures, reporting templates that can be tailored without development cycles, etc. The reality is that accounting standards evolve, entity structures shift, regulations tighten, and we see new things every day. The right software partner listens and adapts so that their technology evolves alongside these changes.
Alongside that, it’s important to leverage software that knows its strengths and delegates areas it’s not yet built for. For example, SumIt has integrations with Addepar for enhanced investment tracking and BILL for streamlined payments.
While it might seem advantageous from a market share perspective to have a software that does everything, our priority is different — we would rather have each component of a family office’s financial ecosystem working seamlessly and correctly, even if that means integrating with another solution rather than owning every workflow.
What’s happening in family offices reflects a larger movement across specialized industries: the migration away from generic tools toward purpose-built solutions.
This migration is not a new concept, however — it’s been cited for the past decade as a revolution in the family office industry, yet nothing has taken hold yet. Why is that?
In short, the market has promised specialization, yet most of the acclaimed “specialized” platforms have stopped short of truly fitting how family offices operate. Too often, these tools are built for wealth managers or for corporate finance teams, then lightly rebranded for family offices.
The result is that family offices continue to default to Excel — not out of resistance to change, but because the alternatives continue to be mismatched or overly complex.
That’s why the next wave of specialization won’t be about software made for family offices, but rather software shaped by them. And, as UBS noted, this shift is being driven by several factors:
The tolerance for outdated systems is fading fast. As consumers, the standards for good software increase every day, especially as most of our lives are connected digitally. That standard does not stop in the workplace, and that’s why today’s family offices want software that feels like it was built for them.
The future of family office software is intelligence. The systems that will define the next generation of these businesses will anticipate needs and flag inconsistencies, transforming the business from being reactive to being proactive. With these modernization efforts, FO back-office systems will finally be as advanced as the wealth they manage.
This is where true partnership between people and technology begins, and why family offices need to leverage technology as an enabler. Of course, our lives are now powered by software, but they don’t need to just be recurring purchases on credit card statements. Rather, the right technology vendors will be a long-term partnership and will build alongside you as your needs — and the industry — inevitably change.
