In 2025, family offices globally are facing one of the most pivotal transitions in modern wealth management history: the passing of leadership and capital stewardship from founding generations to the next. This shift is not just philosophical, it is reshaping how families invest, manage risk, and design their private market strategies for decades to come.
At Gunung Capital, we are seeing firsthand how succession planning is influencing asset allocation decisions across Asia and beyond. The demand is rising for greater flexibility, faster liquidity options, and better alignment with long-term family legacies. This is fundamentally altering how families approach private equity, secondaries, and alternatives more broadly.
The Succession Imperative
The 2025 UBS Global Family Office Report offers a telling insight: over 53% of ultra-wealthy families now have a formal estate or succession plan in place, up from 47% just a year ago. While encouraging, this also means that nearly half are still navigating legacy transitions without clear structures, a significant risk when managing multi-generational capital.
As The Wall Street Journal notes, the vast majority of U.S.-based family offices (approximately 75%) continue to serve first-generation wealth creators. These wealth originators often favor long-horizon, illiquid investments such as traditional closed-end private equity. Their successors, however, are calling for change.
Liquidity and Optionality Over Long Lockups
This generational shift in priorities is pushing family offices toward more liquidity-aware strategies including evergreen funds, secondaries, and hybrid structures that combine yield, flexibility, and long-term value creation.
The McKinsey Global Private Markets Report 2025 shows a pronounced trend: secondaries now deliver the highest median IRRs across private asset classes (vintage years 2012–2021), while offering earlier net cash flow, typically within eight years. This liquidity profile is attractive for family offices looking to diversify beyond blind pools and long lockups. Secondaries, particularly GP-led continuation vehicles are also serving as tools to maintain exposure to high-performing assets beyond their original fund term, while giving families the flexibility to partially exit or roll forward.
The Rise of Evergreen and Semi-Liquid Structures
Perhaps the most transformational development in private markets today is the rise of evergreen vehicles, open-ended structures that offer periodic liquidity, smoother capital deployment, and simplified reporting. Once considered a niche innovation, evergreen funds now account for an estimated $427 billion AUM, according to Morgan Stanley and PitchBook data published earlier this year.
Returns in these vehicles are competitive. Over the 12 months ending April 2025:
- Evergreen PE strategies delivered a median return of 10.8% (top decile: ~17%)
- Private credit in evergreen structures yielded ~7.8%
- Traditional PE closed-end funds returned ~13.8%, though with a steeper j-curve
These evergreen strategies are increasingly built atop secondary portfolios, allowing rapid deployment of capital into seasoned assets, with limited blind pool exposure. As Barron’s highlights, such funds are even paying ~4% premiums above market to acquire top-tier secondary stakes, suggesting strong conviction in long-term upside.
Why Hybrid Models Are the Future
At Gunung Capital, we believe the most resilient family office strategies going forward will integrate hybrid allocation models that blend evergreen flexibility with bespoke legacy preservation. This might include:
- Anchor positions in evergreen secondaries funds for liquidity and access
- Co-investments or direct stakes in infrastructure or impact projects tied to the family’s mission
- Selective commitments to GP-led continuation funds, extending value capture from successful investments
- Private credit and real assets to generate income and preserve capital over generations
As highlighted in BlackRock’s 2025 Global Family Office Survey, family portfolios now allocate 42%–54% of capital to private markets, with rising demand for private credit, infrastructure, and flexible-duration strategies.
Closing Thoughts: From Legacy to Liquidity and Back
Succession planning today is not just about choosing the next generation of leaders, it is about creating investment frameworks that can withstand generational change. Families must ask: How can we preserve legacy without compromising on liquidity? How do we align our values with our vehicles?
At Gunung Capital, we are navigating these complex transitions building portfolios that combine purpose, adaptability, and performance across time horizons. As secondaries, evergreen funds, and hybrid alternatives continue to evolve, the tools are now in place for families to craft a capital strategy not just for today but for 2050 and beyond.
