Investments from family offices slowed down in the first half of the year. CNBC's Robert Frank joins 'Squawk Box' with more on why some of the wealthiest investors in the country are pressing pause.

Washington

Family offices, representing some of the wealthiest investors, have slowed their dealmaking in the first half of the year. Exclusive data from Fintrex shows a 32 percent drop in direct investments by family offices and startups, impacting sectors such as technology, healthcare, and life sciences. The only area to see increased investment was artificial intelligence, with companies like Sandbox, Genesis AI, and Anduril attracting significant capital.

Notable family offices, including those of Peter Thiel, Eric Schmidt, and Lucas Walton, remained active, focusing on sectors like aeronautics, biotech, and sustainable energy. The slowdown is largely attributed to uncertainty around tariffs and the broader investment environment. Experts suggest that if market conditions stabilize and more companies seek funding, family office investment activity could rebound in the second half of the year.

Family offices pause on dealmaking: Here's why

Investments from family offices actually slowed down in the first half of the year. Robert Frank is here to tell us why some of the wealthiest investors in the country have been pressing pause. Hi, Robert. Good morning, Becky. Great to see you. Well, family offices pulled back their deal-making in the first half, waiting for a little more clarity on what the tariff situation is going to look like. The total number of direct investments by family offices and startups fell 32 percent through June. That's according to exclusive data from Fintrex. Now, their investments fell in just about every sector, including their normally favorite areas of tech, health care, and life sciences. Now, the one segment that did see an increase from family offices, you guessed it, was A.I. Companies like Sandbox, Genesis A.I., and Anduril, all attracting a lot of family office capital in the first half. Now, among the most active family offices through June were Peter Thiel's. He made nine family office investments, largely in aeronautics and A.I. Companies. And you have Eric Schmidt's family office called Hillspire. They invested in Relativity Space and a company called Imprint Labs Biotech. And Lucas Walton's family office, he's the youngest Walton there, he invested in sustainable energy and agricultural companies, including Carbon Upcycling and a company called Firefly Green Fuels. They make sustainable aviation fuels. Now, for more on the biggest family office deals in the first half and where the wealthiest investors are putting their money, you can sign up for the Inside Wealth newsletter, new one out tomorrow morning at cnbc.com slash inside wealth. That's cnbc.com slash inside wealth. So that drop of 32 percent was more than I had expected, just based on what I'd read in the intro leading up to some of this stuff. How quickly can that change? Because, you know, that was through June 30th. This month could make a lot of difference. We're hearing trade deals getting announced by the day. You think that's the type of thing? It could. And the great, the reason that companies like these startups love family office capital is number one, it's very patient. Number two, it's flexible. And number three, it's fast. So these folks, because it's usually one person making the decision, if they feel more comfortable in the environment, which I think they will in the second half, it also depends on which companies are out there fundraising. And with private capital and private credit providing so much in the marketplace, there may be a little less need by startups for this kind of fundraise. They may just get it straight from private credit. So if we get more offerings and these family offices are more comfortable, which I think they will be, we'll see more in the second half.

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