Club deals: how family offices syndicate a transaction

A club deal is a private transaction in which two or more family offices, sometimes with an institutional sponsor, invest together through a shared vehicle on terms set by a lead investor. The lead originates the deal, runs diligence, negotiates with the seller and usually commits the largest share of the equity. The other families commit capital into a special purpose vehicle (SPV) that holds the single investment, and governance of the syndicate is set out in that vehicle's agreement. PwC's Global Family Office Deals Study 2025 found club deals accounted for 69% of family office transactions in the first half of 2025, up from 58% in the second half of 2015 and only slightly below the 75% peak in the first half of 2023. The structure is now the default rather than the exception.

The lead investor

The lead does the work that a fund manager would otherwise do. That includes sourcing, commercial and financial diligence, valuation, negotiating the purchase agreement and shareholder rights, arranging any debt, and taking the board seat after closing. Campden Wealth's 2025 North America report distinguishes between "direct active" (17% of the private markets portfolio) and "direct passive" (16%) holdings. In a club deal the lead is active and the joiners are generally passive.

Because the lead holds the majority of the capital and the information, joiners are accepting its judgement. A 2024 survey reported by CNBC found 52% of family offices prefer direct deals through syndicates, which the report attributed to "a cautious approach and reliance on the expertise of established sponsors". That reliance is the central risk of the structure as well as its main benefit.

The vehicle

Most club deals use an SPV, normally a limited partnership or limited liability company, that holds the shares in the target. Each family subscribes for an interest in the SPV, and the SPV appears as a single shareholder on the target's register. This keeps the cap table simple, concentrates voting rights in one holder and allows transfer restrictions to be set at the SPV level. Ropes & Gray's 2025 note on co-investment economics reported that 70% of general partners usually or always structure co-investments as separate entities, and noted these vehicles must be audited, file tax returns and maintain financial statements, costs which someone has to bear.

Carta data from 2024 on 442 US private equity SPVs above $10m gives a sense of scale. The median vehicle formed in 2023 was $22.6m, up from $15.2m in 2019. Half of the sample sat between $10m and $20m, and the median vehicle in that band had 18 investors. Counts ranged from a single investor to dozens.

Economics

Terms vary with who is leading. When the lead is a fund manager offering co-investment to its own investors, fees are often zero. Ropes & Gray cited survey data showing over two-thirds of managers charge no management fee on co-investment, 42% charge no carry and a further 39% charge reduced carry. Across single-asset deals since 2022, 49% carried neither fee nor carry. Where fees are charged they typically run 0.75% to 1%, with carry at 7.5% to 15%. Bain's 2026 Global Private Equity Report found the median manager now offers 33 cents of co-investment for every dollar of fee-bearing capital.

When a family leads, the economics are negotiated case by case. Carta found 52% of $10m-plus SPVs formed in 2023 charged a management fee, with half of those between 1.4% and 2%. A family lead may take a promote on exit, charge a deal fee to cover costs, or take nothing and rely on reciprocity. Whatever is agreed should be written into the SPV documents before closing, including who pays the vehicle's running costs if the deal fails.

Governance of the syndicate

The SPV agreement should settle five questions before signing: who votes the shares in the target and on what matters the lead must consult; what information joiners receive and how often; how follow-on capital is raised and what happens to a family that does not participate; how and when any investor can transfer its interest; and who decides on exit timing. Ropes & Gray noted that larger co-investors increasingly co-underwrite and ask for board seats, which is "a departure from the traditionally passive model". Decision rights inside the family office itself matter too, and are covered in family office decision rights.

Pitfalls

Three problems recur. Joiners skip their own diligence because a peer has done it, which is the reason direct deal due diligence applies to club deals as much as sole deals. Follow-on rounds expose the syndicate when one family cannot or will not fund its share. And exit disputes arise when the lead wants to hold and the joiners want liquidity, with no mechanism to resolve it. Morgan Lewis noted in 2025 that "different agreements, styles, and issues may arise depending on capital deployment style". How families find each other in the first place is covered in family office co-investment networks.