India’s wealthiest families are dismantling a decades-old reflex, the instinct to pour everything back into the business they know best. What replaces it will define the next chapter of Indian wealth.
For most of India’s promoter class, wealth and business were once the same thing. Capital went back into the company. Diversification was a concept for people who didn’t trust their own enterprises. That logic held for generations, until it didn’t.
Gurjeet Sohi, Managing Director and Head of Wealth Management for India at Lighthouse Canton, has spent over two decades navigating this conversation. The turning point, he noted, comes when families finally acknowledge a distinction that feels obvious from the outside but rarely does from within: the difference between risk you can manage and risk you simply cannot.
“Every industry goes through cycles. Regulations change. Your entire wealth concentrated in a business is a big risk,” he said. This he describes as systematic risk, the kind that hits regardless of how well you know your sector.
History makes the case.
Of India’s five most powerful business groups from five decades ago, few remain dominant today. Sohi invokes this benchmark often with clients. “When your business creates value, you need to cash it and look at something which will sustain that value for a longer period of time,” he said.
The prescription is not dramatic: redirect surpluses into uncorrelated assets. Fixed income, defensive equities, global exposure. The goal is not to exit the business but to ensure that its fortunes are no longer the only ones that matter.
The new generation of promoters, Sohi observed, has absorbed this lesson through lived experience, watching peers who rode a single sector all the way up and then all the way down.
A WEALTH MANAGEMENT INDUSTRY IN FLUX
The structural shift in how Indian families think about wealth has created an industry in rapid transformation. India’s family offices have grown from 45 in 2018 to approximately 300 by 2024, a near-sixfold increase with the cohort now managing an estimated $30 billion in assets, according to IBEF.
The generational shift is reshaping what wealth management even means. The next generation is less emotionally tethered to the family business and more focused on building investment frameworks around it.
“The new generation is not only married to their traditional business but are flirting with other opportunities and ideas,” Sohi said. Many are building angel portfolios, backing early-stage companies, and hiring investment professionals directly into their family offices, pulling talent out of the very asset management industry that once served them.
Private equity has taken notice.
Capital is flowing into wealth management firms at pace, betting on the sector’s long runway. The influx has intensified competition for talent and clients alike, with firms scaling headcount aggressively.
Sohi was candid about the risks of that approach. Threshold-free client acquisition and mass-scale distribution blur the line between a wealth manager and a retail broker. Lighthouse Canton’s response is deliberate: build on the existing decade-old platform and grow with intention over the next three to five years, with the right talent and culture, rather than chase AUM at the cost of quality.
The rising bar set by family office clients has also forced a reckoning in product design.
The era of off-the-shelf mutual funds is over for this segment. Private credit is emerging, still at a nascent stage in India, early compared to the global markets, but growing fast. Sohi underscored the discipline required.
“You need to understand the dynamics very well , the underlying where you’re investing, the people you’re giving money to. 16–18% sounds attractive, but there is enhanced underlying risk as well,” he said.
Any firm that wants to be genuinely relevant to family offices, he added, needs to function like an asset manager, not a distributor.
SUCCESSION PLANNING’S UNCOMFORTABLE SILENCE
For all the sophistication now on display in Indian family office investing, one area remains conspicuously underdeveloped: legacy and succession planning.
The reasons are as much cultural as structural. “This legacy succession planning is still a sensitive issue — some family members don’t even want others to know exactly what they have in mind,” Sohi shared.
Wealth firms are not the primary solution here, and Sohi was straightforward about why. Complex cross-border structures require the institutional credibility and legal depth that only the largest law firms and Big Four accounting practices can reliably deliver. “By and large, clients still rely on well-established, large legal firms to help them set up their structures.
What has shifted is the baseline. A decade ago, a significant share of HNI clients had never written a will. Nominations in investment accounts were treated as adequate estate planning. That is no longer acceptable, and wealth advisors are now at least guiding clients through the fundamentals. The more complex architecture (multi-generational trusts, offshore holding structures, philanthropic vehicles) remains specialist territory. As Indian families move into their third and fourth generations, where business interests diverge and cohesion becomes harder to maintain, the demand for that guidance will intensify.
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