PG3, the family office founded by the creators of Partners Group, has achieved significant success with investments in natural catastrophe reinsurance and music royalties. Now, the firm is introducing its unique, uncorrelated investment strategy to Australian investors.
Unlike most family offices, which tend to concentrate on assets tied to their founders’ industries, PG3 has pursued niche, low-correlation asset classes since its launch in 2013. Co-founder Urs Wietlisbach, for instance, holds most of his wealth in Partners Group stock but PG3’s portfolio ventures far beyond conventional markets.
“Our initial focus was insurance finance, including catastrophe bonds and life runoff portfolios,” Wietlisbach shared at The Inside Network’s Alternatives Symposium. PG3 later expanded into litigation finance—highly uncorrelated with stock markets—and royalties, such as those from pharmaceuticals, music, and gas.
This strategy proved its resilience in 2022 when global markets struggled. PG3’s chosen asset classes not only avoided losses but delivered strong returns. Today, the family office manages nearly $3 billion, with Wietlisbach planning to increase his personal stake from 15% to 20%.
PG3 typically seeds its funds with its own capital—hundreds of millions of dollars—before opening them to close associates and institutional investors like pension plans. “Since 2013, through crises like the European credit crunch, COVID, and the 2022 downturn, we’ve never had a losing year,” Wietlisbach said.
Music royalties, a key focus for PG3, generate long-term cash flow and align well with evergreen funds that avoid forced selling. “Five years ago, royalties weren’t attractive because prices were inflated, and they were stuck in limited partnerships with fixed timeframes,” Wietlisbach noted. “Now, we have a significant allocation to music royalties.”
Similarly, natural catastrophe reinsurance offers unique opportunities due to annual repricing. “The premiums fluctuate widely, often tripling or quadrupling depending on the year,” Wietlisbach explained.
In collaboration with Longreach Alternatives, PG3 has launched its royalty-focused fund in Australia, emphasizing its innovative approach to generating double-digit, uncorrelated returns. According to Sam Edwards of Longreach, building diversified portfolios across European insurance finance, litigation finance, and royalties requires expertise not easily replicated by traditional wealth managers.
PG3’s ability to innovate and thrive in unconventional markets highlights the advantages of thinking outside the typical family office investment framework.
