Ninety Percent Of Family Businesses Are "Less Rich Than Three Generations"

Yellow iron seedling After 30 years of reform and opening up, it is an undeniable fact that, except for a few people or individuals from special families and regions, the economic situation of the Chinese people has changed dramatically compared with that of 30 years ago - people have become rich, although the degree of wealth is different. At the same time, many people of insight also keenly found and put forward a very sharp question: how can Chinese people jump out of the strange circle of "wealth is less than three generations" after being rich? The history of the rise and fall of a large number of families at all times and in all over the world shows that no matter what way a family gets rich, it rarely lasts more than three generations. Therefore, the world has summed up a law, which is called "not rich for three generations". Some scholars pointed out that China's history is continuous, and there is no wealth family that can be inherited for more than 100 years and is still prominent in today's society. Facts tell people mercilessly that rich families often have "black sheep" and "poor grandchildren". Throughout the ages and at home and abroad, it is common for wealthy families, families and enterprises to be "less than three generations rich", and even has certain universality. More than 90% of China's private entrepreneurs can't get rid of the fate of "not rich enough for three generations" Since the reform and opening up, there have been more than 3 million private entrepreneurs in China. Today, many of the first generation private entrepreneurs are facing retirement, but the worldwide business problems of enterprise wealth inheritance and intergenerational transmission have not been solved well. According to the survey data, more than 95% of China's private entrepreneurs cannot escape the fate of "not being rich for three generations" because they cannot find qualified successors. At present, only about 10% of the children of elite rich families in China inherit their parents' good qualities and become positive, diligent and studious people. Nine private enterprises in China close down every minute, and less than 10% of them can survive for more than three years. For many rich families, families and enterprises, some are not rich for three generations, but whether they can be rich for two generations. There are many "second generation ancestors" in the Pearl River Delta, which are typical examples. "Second generation ancestor" is a Cantonese dialect, which means "black sheep". It is said that Dad worked hard to start his own business and bought land and land to build a courtyard, but his children failed to win, and they were obsessed with enjoyment and stimulation, becoming "black sheep". In Hong Kong, people from all walks of life are also not optimistic about the inheritance of Hong Kong family businesses. A study by the Chinese University of Hong Kong has confirmed that the phenomenon that Hong Kong family businesses are "less rich than three generations" is very serious. Based on the survey of the stock prices of 38 listed family businesses that have experienced wealth replacement in Hong Kong in the past 15 years, the average return on their shares has dropped 80% in the eight years since the previous generation of leaders handed over their power, excluding other market factors (such as financial turmoil). "Rich but not rich for three generations" is not Chinese characteristics, and global family businesses generally face the problem of "poor grandchildren" The survey shows that the average life span of family businesses around the world is only 24 years, 30% of family businesses can pass on to the second generation, only 10% can "live" through the third generation, and the elimination rate is as high as 90%. "Rich but not three generations" is not Chinese characteristics, and global family businesses generally face the problem of "poor grandchildren". In the United States, only 30% of family businesses can exist in the second generation, only 12% in the third generation, and only 3% in the fourth generation and beyond. The Portuguese have a saying that "rich farmers, noble sons, poor grandchildren"; The Spanish also have the saying that "the hotel owner, the son rich, the grandson begging"; The Germans use three words "create, inherit and destroy" to represent the fate of three generations. The British Times once conducted a survey of the world's super rich in the past 20 years, and found that seven out of ten people could not keep their wealth. The main reason was either blind investment leading to business errors, or luxury of life leading to spending money, which greatly reduced their wealth. Through research and analysis of the Forbes 400 richest people list in the world over the past 20 years, JPMorgan Investment Bank found that, on average, only one of the five super rich people on the list could survive for 20 years, and 80% of the rich people were "eliminated". It can be seen that the phenomenon of "not rich enough for three generations" is universal and worth further discussion.