Episode summary
Why Family Offices Must Go Risk-On or Go Broke
How I Invest With David Weisburd
· · 22 min · Hosts: David Weisburd · Guests: Nathan Cooper
Summary
Nathan Cooper argues that family offices only survive across generations if they stop treating capital as something to preserve passively and instead concentrate risk where they have genuine edge. For his family, that edge is food and beverage: an operationally brutal industry with thin margins, retailer pressure, and working-capital demands, but also one where deep pattern recognition and industry relationships can compound. He says the family office spent its first 15 years outsourcing too much, then shifted to a model that insourced what it knows best and outsourced commoditized investing.
That approach led to Barrel Ventures, a food and beverage fund built around operator experience and network-driven diligence. Cooper describes using LPs as first-call customers, advisors, and operating partners, and says that has driven millions of dollars in sales and ARR for portfolio companies. He also points to early backing of Ollipop, where the firm initially took a small position and then doubled and tripled down as conviction strengthened.
Cooper makes the case that food is underrated because everyone interacts with it every day, consumer tastes keep changing, and venture-style outcomes are possible even in lower-margin categories. He argues that family offices eventually have to go from risk-off to risk-on because, without growth, wealth gets diluted across generations and compounds down to nothing.
Key takeaways
- Nathan Cooper says the family office shifted from outsourcing everything to focusing on food and beverage, where it has the clearest edge.
- He argues elite family offices should take risk where they have alpha, not just build a generic portfolio.
- Barrel Ventures uses LPs as customers, advisers, and diligence partners, which Cooper says has helped create millions of dollars in sales and ARR.
- Cooper says Ollipop became a conviction bet that the firm doubled and tripled down on after the first small check.
- He argues food is underrated because it is universal, hard to disrupt with AI, and still capable of venture-scale outcomes.
Notable quotes
“this industry more than others is operationally brutal. There's thin margins in this industry, powerful retailers, working capital pressure”
“we went from, you know, the first 15 years outsourcing everything and figuring out essentially what we didn't want to be”
“where we're going to take risk is in the area that we have the edge, right? because it makes sense to lean into our expertise”
“If you don't understand where where you came from and how things were built, then you just sort of assume like this is how it's been”
How the episode opens
Nate, so your family operated in the food business for nearly a century before starting a family office. What did that teach you about building an enduring franchise? — So this industry more than others is operationally brutal. There's thin margins in this industry, powerful retailers, working capital pressure. And so it really instilled in me that misline incentives are not the way to build enduring businesses in this industry or or in life for that matter. Last time we chatted, you said that your first 15 years of your family office were mired by many costly mistakes. Tell me about some of those mistakes.
Building success and wealth outside of the financial services, you are suddenly put into this position of hey, you're no longer operating a business. Now you're operating a a family office, right? A financial industry.
And so you need to learn expertise and it's a drastically different operational world. Uh and so we went from, you know, the first 15 years outsourcing everything and figuring out essentially what we didn't want to be to the past, you know, seven to 10 years saying, "Hey, here's what we're really good at and we're going to lean into our expertise and we can still outsource the things that aren't, you know, a core edge for us, a core competency, but it makes no sense to pay fees on fees of things that we are as good, if not better at than people going to be paying them to."
So you started by outsourcing everything to large financial firms. you took a step back and you looked at what you're really good at. You insourced that and you outsourced everything else. What exactly did you insource and what did you outsource? We you know we said we're never going to make alpha trade stocks, right?
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- family office risk allocation
- operator-led investing
- food and beverage venture capital
- lp relationships
- pattern recognition in deal selection
Companies and tickers mentioned
- Barrel Ventures
- Ollipop
- AlphaSense
Watch the episode
Watch “Why Family Offices Must Go Risk-On or Go Broke” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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How I Invest With David Weisburd, this episode and its artwork belong to David Weisburd. Octagon is not affiliated with the show; this page is an independent summary.
