The numbers released by Bloomberg a few weeks ago – and what they say about the world’s wealthiest families – are astonishing to me:
The top 25 families control almost $1.4 trillion of the world’s wealth (an increase of 24% from 2018).
These families combined to accumulate $250 billion more in wealth over the previous year.
The wealthiest family – the Waltons, of Walmart fame – are worth just over USD $190 billion. They grow their wealth by $100 million per day. In the time you’ll take to read this short e-mail, the Waltons will have added $350,000 to their net worth.
These and other revelations are found in Bloomberg’s 2019 ranking of what it calls the world’s ‘wealthiest family dynasties.’ Many of the names are iconic and known to all of us. Others are known more for their operating companies and public-facing brands than their family name. And others are more obscure, but wealthy dynasties just the same. They stretch from North America to Europe and Asia.
Beyond the obvious – family businesses all across the globe really can grow this large – we at CMG have noticed three common ingredients in the top 25.
Humble origins. Many families have their roots in small operations that grew steadily (and sometimes explosively) over time. Sam Walton started with one store. Frank Mars learned to hand-dip chocolates as a young boy. Hermes started in 1837 by making riding gear for noblemen. Here in Canada, the Thomson family gave birth to its media empire with one lonely radio station.
Longevity. All but one of the families has spanned at least three generations. The two families behind Cargill are in their sixth generation, as is Hermes! Mars and Johnson (makers of Tylenol and other household products) are each in their fifth. Many more have endured for four generations. These families have not only been successful in building iconic businesses, they have endured.
Persistence. Like many of the business families we see here at home, the top 25 have weathered their share of challenges – within the family, in the business, and often both. More than 50 family shareholders banded together in 2010 to fight off a hostile takeover that would have taken Hermes public. (We even wrote about it.) The Johnson family turned a nightmare scenario – the Tylenol scare of 1982 – into a reputational gain by the speedy and effective manner in which it handled the crisis. Closer to home, think of how the McCain family overcame the listeria outbreak at Maple Leaf Foods in 2008. The world’s wealthiest families have not only endured, they have overcome major challenges in doing so.
So how do they do it?
It’s a topic constantly on our minds at CMG – and really at the core of what we do. We’re currently in the midst of a research project examining the key lessons learned from Canada’s most accomplished families in making the successful transition from one generation to the next – and often multiple times. Are there principles or best practices common amongst such families? What are the consistent threads? And are there pitfalls to avoid?
We expect to share our initial findings of the research in the next few months
In the meantime, you can read Bloomberg’s story and ranking of the world’s 25 wealthiest families here.
Marty McConnell is a co-founder and partner at Creaghan McConnell Group.