April 12, 2022: -After making inroads managing money for the merely wealthy, Morgan Stanley is setting its sights on the richest of the rich, family offices with tens of billions of dollars in assets, CNBC has learned.

The bank has spent the last four years developing a suite of products geared toward family offices, the increasingly powerful investment entities set up by the world’s wealthiest individuals and families, according to wealth management Chief Operating Officer Jed Finn.

The move is the latest sign of the arrival of the family office as a critical player blurring Wall Street’s old distinctions. The firms have exploded in number in the past decade. In their global search for yield, family offices have morphed into go-anywhere vehicles that can make wagers like hedge funds, invest in start-ups like venture capital firms, and even purchase companies outright.

But their size and complexity have meant that family offices have been mostly ignored until recently, being too large for banks’ traditional wealth management channels and too small for institutional coverage, Finn said.

“They’ve fallen between the cracks of what had existed before,” he said. “It’s a $5.5+ trillion segment where nobody has significant share because there’s no single offering that really can fit the various needs of the different families.”

The push comes as Morgan Stanley, run by CEO James Gorman since 2010, aims to reach $10 trillion in client assets, more than 50% higher than the current level. In part, Gorman has helped shape Morgan Stanley into a wealth management giant through acquisitions that helped the bank target a broad spectrum of clients. The strategy has been applauded by investors, who prefer more stable sources of revenue over relatively volatile trading and investment banking.