Whereas Africa is known for its struggles against poverty, a growing number of African entrepreneurs is successfully creating and acquiring wealth through enterprise and hard work. A large part of Africa’s current economic upsurge is driven by family businesses while over half of global GDP is created by family businesses.
Some of the world’s wealthiest families have successfully transferred their wealth across the ages, thanks to carefully devised strategies. However, In Africa, very few family businesses survive more than three generations.
Most family businesses struggle or go down the drain immediately the 2nd generation takes over control due to lack of knowledge on managing and running huge multi-billion businesses. An estimated 70% of wealthy families lose their wealth by the second generation, and a stunning 90% by the third, according to the Williams Group wealth consultancy
Whilst building a formidable business empire may take immense hardwork and a lifetime sacrifice, it only takes a year or two of poor management to bring the business to its knees. Wealth preservation and generational wealth transfer requires a clear, fixed, purposeful family governance structure that determines how the legacy is passed on.
The upcoming Africa private banking and wealth management Forum could build a discussion around to address the challenges present in the current wealth management landscape. The forum will be held on the 21st and 22nd of March at the Radisson Blu Hotel Nairobi Kenya.