CampdenFB magazine_75

ISSUE 75 / 2019 LLEIAGDHITNSG A review of the past 75 issues celebrating the best of family business

WE DON’T SPECULATE ON THE FUTURE. WE BUILD IT. EDMOND DE ROTHSCHILD, BOLD BUILDERS OF THE FUTURE. INVESTMENT HOUSE | edmond-de-rothschild.com Edmond de Rothschild (Europe) S.A., established at 20, Bd Emmanuel Servais, 2535 Luxembourg and subject to the supervision of the Commission de Surveillance du Secteur Financier in Luxembourg. Registered number RCS Luxembourg : B19194

WE’VE TRAWLED THROUGH OUR ARCHIVES TO BRING YOU 75 FAMILY BUSINESS LEADERS WHO ARE EITHER LEADING THEIR FAMILIES WITH APLOMB OR PART OF A CROP OF YOUNG RISING STARS Editor FROM THE EDITOR Nicholas Moody HERITAGE AND Deputy Editor INNOVATION James Beech W elcome to our 75th edition! It all started but how many have been Senior Writer back in November 2001 when the first practicing it since 1672? James Susan Lingeswaran edition of Families in Business (as it Beech speaks with the UK’s was originally known) rolled off the 11th-generation Hoare family Art Director press with a mixture of interviews, in our Wealth & Purpose Sean Bennett insights, and advice. Preserving a proud section. Then it’s to innovation heritage, while always looking for opportunities with Susan Lingeswaran who Contributors to innovate and expand is the hallmark of a great has interviewed two energised Alison Ebbage family business and it is these same qualities that next-generation entrepreneurs CampdenFB has upheld over the past 18 years. You in separate pieces from page Executive Director, Sales can see the innovations in the montage of different 22, the first is Germany’s Kevin Grant covers we have selected as this edition’s cover, Verena Bahlsen and the next from the original Families in Business editions, is India’s Anirudh Damani. T: +44 (0)20 3763 2804 through our illustrated series, to our modern Innovation doesn’t come much glossy ensembles. Inside the edition we’ve kept more futuristic than quantum Sales Team with this mix of tradition and innovation, kicking computing, and though it’s still Owen Hart off our Research & Rankings section from page a way off commercialisation, Laurence Mackintosh 43 with a review of 10 iconic covers. That then we look at how it might affect leads into in the ‘75 for 75’ special feature from family businesses and investors Chief Executive page 46, where we’ve trawled through our archives from page 74, before Susan Dominic Samuelson to bring you 75 family business leaders who are Lingeswaran examines the either leading their families with aplomb or part intricacies of philanthropy Published by of a crop of young rising stars. A proud heritage among Asia’s fast-growing and Campden Wealth Ltd of humility is at the heart of the Saraf family, the diverse economies. focus of our main profile from page 14, who are 30 Cannon Street in the midst of bringing their third generation into Nicholas Moody London EC4M 6XH their Indian steelmaking business. Philanthropy is Editor a core value of many multigenerational families, United Kingdom [email protected] T: +44 (0)20 3763 2800 F: +44 (0)20 3763 2801 CAMPDENFB.COM 1 E: [email protected] For subscriptions please call +44 (0)20 3763 2800 or go to campdenFB.com ISSN: 2040-8900 Printed in the UK by Stephens & George Print Group Copyright © Campden Wealth Ltd 2019 The contents of this publication are protected by copyright. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means without prior written permission of Campden Wealth Limited. The views expressed in this publication are not necessarily those of the Publisher or any of its employees or agents. While the aforementioned parties have taken every care with regard to the accuracy of all editorial and advertisement material, they cannot be held responsible for any errors or omissions contained therein. ISSUE 75 | 2019

CONTENTS CAMPDENFB | ISSUE 75 | 2019 PROFILE 22 SETTING THE BARS 21 Three generations of the NXG Saraf family at Radha Smelters have helped 22 IN THE NAME OF THE make India industrious. GREAT-GRANDFATHER Suman Saraf, managing director, discusses Entrepreneur Verena the values his father Bahlsen was inspired by instilled and the the ancestral founder personal experiences of her German family’s that shape his dealings famous biscuit-making with business rivals, business to revolutionise investments and global food culture succession 30 School of hard knocks Why selling door-to-door in Texas, away from the family business, was the making of Indian next-generation angel investor Anirudh Damani 14 36 2 CAMPDENFB.COM 35 FB ACADEMY 36 B ABY STEPS Next-generation family experts reveal how teaching children to grow responsibly in the midst of wealth can be fun and functional PHOTOGRAPHY: ISTOCK, ALAMY, SHUTTERSTOCK

REGULARS 1 Editor’s 4 News 10 View from 12 View from note Asia-Pacific The GulfISSUE 75 / 2019 46 80 4LL3EIAGDHIT6N7SGArevie 79 FB DIGITAL HSwtAEhAoLeLfRbCOteHFhsFe+tApRMoaAfEsNftKaI7mN5iGliSys RE CAPITAL HUB THE FINER THINGS READ THE LATEST NEWS ABOUT FBs 44 sbuu6es8siCoinncndyeeitpvsalirxdseuurbsealsrsTidhaeetnliconywgf-odrown 80 N ET JET VALUE AND FOs AT We flashback to our The nuts and bolts favourite CampdenFB of charter, fractional CAMPDENFB.COM covers over 75 issues ownership or full 69 Montenegro A Balken ownership of private jets SUBSCRIBE hotspot of rapid and TO OUR WEEKLY 46 Top 75 business sustainable growth 86 leaders 2019 BULLETIN The titans of worldwide 70 Bulgaria How to navigate 85 family business defined and legislation for the best FOLLOW US ON profiled—who do you know? investment activities LEGACY Twitter @CampdenFB LinkedIn Campden Family 64 73 86 G IVING TRADITIONALLY, Business & Family Office SUSTAINABLY AND Instagram @CampdenFB LEADING EDGE DISCREETLY Vimeo 74 F EELING THE Exploding the myths SUBSCRIBE ALGORITHM around wealthy families and TO OUR philanthropy in Asia-Pacific Quantum computing MAGAZINES AT decrypted—who is doing 92 Banking on what, and should you social impact +44 (0)20 3763 2800 invest now? Why the Hoare family, the owners of Britain’s oldest or go to 64 China rising 74 privately owned bank, are angel investors for CAMPDENFB.COM Fast facts, major players charitable start-ups spotlighted, and a deep dive on Amazon’s biggest 96 Icon: Blake Nordstrom competition ISSUE 75 | 2019

NOTEBOOK Family takes Edmond de Rothschild bank private The only matriarch of a Rothschild company $170.6 will become the operating holding billion company, chaired by Ariane. Benjamin is about to complete a four-year project to will chair the parent entity, Edmond de of assets Rothschild Holding SA. bring the dynasty’s billion-dollar private Swiss under The entity would continue to adapt bank into full family ownership. management while modernising products, bringing The independent family-run investment house its different businesses closer together $1.1 and considering outside opportunities for Edmond de Rothschild (Suisse) SA announced it billion growth as they came up, the bank said was in the final stage of becoming a fully family- in its statement.. owned, delisted and simplified entity. It would revenue consist of more than CHF170 billion ($170.6 billion) The move followed the resolution in of assets under management, CHF1.1 billion 2,700 June 2018 of a three-year legal dispute of revenue and employ 2,700 staff across 29 staff between cousins Benjamin and David worldwide locations. de Rothschild over the commercial use across 29 of the family name. The name became Next month, the 66-year-old family group said it worldwide synonymous with finance ever since will offer CHF17,945 for each publicly traded bearer their great-great-great grandfather Mayer share, or 15,500 francs after deducting the proposed locations Amschel Rothschild founded a bank in dividend. Frankfurt in the 1760s. In a statement, Ariane de Rothschild, 53, the wife In April last year, David, 76, retired as of Edmond de Rothschild bank chairman Benjamin chairman to become the supervisory de Rothschild, said she was named chairwoman of board chairman of Rothschild & Co, the the bank’s executive committee in 2015 “with the $2.2 billion Anglo-French independent objective of creating a sound and united banking group, advisory group. In accordance with benefitting from a unique and distinctive brand name, their succession plan, Alexandre de with a clear vision and a robust balance sheet.” Rothschild, 38, became the seventh generation of the family in charge of the All banking activities will be consolidated under bank as executive chairman. It remains the banner Edmond de Rothschild (Suisse) SA, which to be seen if the legal settlement and evolutions of structures and leaderships will encourage the two branches of the Rothschild family business to move 4 CAMPDENFB.COM PHOTOGRAPHY: PRESS ASSOCIATION

French families Notre Dame Heineken donations draw backlash Strong demand for its non-alcoholic beer helped family-controlled Heineken post sales a growth of 7.7% by volume in 2018—its best performance in over a decade. Its success was credited to Heineken® 0.0 being rolled out to 38 markets worldwide. GOOD QUARTER rance’s billionaire families Philippe Marinez, head of France’s CGT BAD trade union, told the Washington Post: QUARTER F are facing a backlash over “In one click, 200 million, 100 million. If their recent pledge to they can give tens of millions to rebuild Reimann donate €500 million ($700 Notre Dame, then they should stop telling million) to rebuild the fire-damaged us there is no money to help with social Germany’s Reimann family, Notre-Dame Cathedral, with critics emergency”. owners of Pret A Manger and questioning its worthiness as a cause. In the immediate aftermath of the fire French politician and trade unionist, Krispy Kreme Doughnuts, at Notre Dame Cathedral, the Pinault Philippe Poutou called the donations “a has pledged to donate family, owners of Gucci parent company, contest of tax evaders” after French prime Kering pledged €100 million towards the minister Edouard Philippe increased the $10 million to charity after cathedral’s restoration. usual tax break for donations from 66% to a commissioned report Hours later, both the Arnault family, 75%, for gifts up to €1,000. owners of luxury group LVMH headed by revealed the extent of their billionaire Bernard Arnault, and L’Oreal’s Responding to the criticism at a patriarch’s involvement with Bettencourt Meyers family pledged €200 shareholder meeting, Bernard Arnault the Nazi regime, including the million each. said his family holding company was not But after initial praise by the media, eligible for a tax break and his firm had use of slave labour. there has been a growing backlash about reached a ceiling for such benefits. income inequality and the worthiness of the cause. The Pinault family also responded by saying it would not be seeking any tax breaks on its €100 million donation. NUMBERS CRUNCHED invested by Cosentino stake in Tesla acquired by in fines given to tycoon family-owned Cosentino billionaire Oracle founder George Soros’ family gifted to the University Group, world leader in Larry Ellison through his office, Soros Fund of Cambridge by David the design, production and family office, the Lawrence Management, by Hong Harding, the billionaire distribution of innovative J Ellison Revocable Trust. Kong’s securities regulator founder of hedge fund firm surfaces, for a new sales and The 1.75% stake makes for naked short selling for Winton Group to provide logistics centre in Stockholm him the second-largest a trade involving a bonus more than $102 million worth as part of its $246 million shareholder of Tesla after share issue of Great Wall of full scholarships for PhD European expansion. founder Elon Musk. Motor in 2015. students and $26 million to support undergraduates. $130 m $477,000 $1 bn $192,000 ISSUE 75 | 2019 CAMPDENFB.COM 5

NOTEBOOK NEWS IN BRIEF Family office growth Bart Becht, chairman rockets but succession and one of the three planning lags in India partners at JAB Holding Company, who spearheaded a $50 billion spree of acquisitions over the last five years for Germany’s Reimann family, has announced his retirement. He will be succeeded by executives who expanded the portfolios of the families behind Mars and Anheuser-Busch InBev. amily offices are being wealth, thanks to the sales of assets, London’s last family exits from family businesses and the brewer Fuller, Smith and F embraced by India’s economic growth of the country. wealthiest $2 trillion Turner, has agreed to families, but few families “Consequently, family offices sell its entire beer business have a robust succession plan in are becoming increasingly to Japanese firm Asahi Group place to secure their fortunes. popular in India,” Patni said. Holdings for $328 million to The world’s first study on India’s focus on its pubs and hotels. nascent private wealth market place, “However, the fact that there are only Fourth-generation Michael released by Campden Research, found about 45 formal family office structures Turner said the decision to more than half (58%) of Indian families in existence demonstrates a dearth sell had been “emotional, surveyed were interested in setting up, of understanding on the purpose and but the logic for doing it was or joining, a family office to manage, services offered by family offices.” preserve and grow their wealth. Half compelling.” (50%) said they were in the process of Anshu Kapoor, head of private wealth Trussardi, the 108-year- establishing their own family office. management at Edelweiss, said India had old family-owned fashion India has the sixth largest economy about 150,000 high net worth (HNW) house is the latest Italian globally and is expected to be the families with a cumulative net worth of second largest economy by 2050. $2 trillion. This number was expected heritage brand to accept Almost 80 ultra-high net worth (UHNW) to rise to 400,000 HNW families with a buy-out following a €50 families with an average net worth of a net worth of $5 trillion by 2025. million ($55.6 million) deal $645 million and $318 million assets with QuattroR, an asset under management were studied by “We are witnessing openness management firm that targets Campden Research for its new report from these families to the concept struggling businesses. Third- The Family Wealth Report 2018: A of a family office beyond traditional generation chief executive Roadmap for the Indian Family Office. wealth management. Collaborating Tomaso Trussardi said the Amit Patni, director of Campden Family with partners like Campden to injection from QuattroR Connect, said India had witnessed the conduct such research activities is would underwrite its five-year generation of vast sums of personal in sync with our core philosophy international development plan. of listening to our clients/potential clients and constantly evolving ourselves to cater to their needs.” 6 CAMPDENFB.COM PHOTOGRAPHY: ISTOCK, PRESS ASSOCIATION, TRUSSARDI ISSUE 75 | 2019

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BRIEFING Prof Randel Carlock Keng-Fun Loh is co-founder of is the Berghmans Lhoist Chaired Professor in Family and Business Learning, with 25 years Entrepreneurial Leadership at INSEAD and a coach, family therapist, and former chief executive of wealth management experience, and and chairman of a NASDAQ-listed company, a member of the Family Firm Institute (FFI) and its Asian Circle study group. You decide what your focus and priorities are, based on your own situation. We use the Parallel Planning Process (PPP), in combination with the online 360° Profiles, to enable multigenerational families to create a planning blueprint to move from values to vision, and from vision to their family and business’s strategy, investment, and governance planning actions. PUTTING THE FIRST FAMILY How do these 360° assessments work? BUSINESS ON THE MOON The online 360º planning assessments help enterprising families capture data An idea borne from a classroom Eureka moment provided from multiple members on current the basis for a groundbreaking field book for families. Randel activities, to guide family discussions Carlock discusses the vibrant guide he and co-author Keng-Fun and planning. The idea comes from Loh created to help families prepare for their own lunar landing leadership development assessments, where you, your boss, direct reports, and peers, rate your performance. Our 360º Profile participants will each get a feedback report that compares his or her responses with the family average for a shared view of the family’s planning situation. This deals with the single most important issue in family business—making the implicit, what everybody thinks they know, explicit. Because the data comes directly from the family, it also creates psychological ownership. Your book, A Family Business on the original artworks to help the families Finally, are there three key learnings you Moon, has an unusual title—where did experience and ‘see’ the ideas. think families could take out of the book? the idea come from? First, a shared vocabulary to enable It came from (Canadian third- How is the field book used? and encourage communication. generation family business) Bata Designed to encourage application and Shoes. They were training with me at experience, each activity is a small yet Second, they need to align INSEAD. We were working on their significant step to create momentum their values, vision, strategy, vision, and one of their sons, Charles, throughout the family and business investment and governance for called out: “We’ve got shoe stores all systems. I have seen for more than two both family and business. over the world, let’s put one on the decades that best practices do not work moon!” I thought, “What a great title!” with enterprising families, because each Third, there is never too much family is unique. talent in a family. Every family Who did you have in mind when you member can contribute, and the wrote it? So there are no case studies. Your family needs to plan for that, and This book is written for enterprising family issues become a live case study, especially, the next generation’s families so that they can work on it as you explore your unique situation development as leaders, directors, on their own, and then go to their using the planning tools in this book. and owners. adviser. It has 24 classroom-tested planning activities and more than 70 What process does the book take A Family Business on the Moon you through? is published by Global Family Enterprise Advisors. Turn to page 42 to read our book review. 8 CAMPDENFB.COM ISSUE 75 | 2019

their business challenges.www.columbia.business/EF +1 212-854-7613 | [email protected] 96%Contact Liz Schultz to get started today. have an immediate and long-term impact. Business School Executive Education, where your return on investment will fefcehlatllletnbgebse. Betrinttg yetouerrsrtpo tphreerneewpEpantearrperriseidngdFtamotilioesapradogdrdamdraterCoeslumssbisa tMhtahneageiinrgiarbfambuilyusowsinenidnaendesopserastcedchenhtaerpalrilsleelceonmnegs wgeithesitss.ow.n Managing a family owned and operated enterprise comes with its own challenges. Bring yours to the new Enterprising Families program at Columbia BuMsinaensasgiSncghaoofal mExileycouwtinveedEadnudcaotpioenra, twehdeernetyeorpurrirseetucronmoensiwnvitehstitmseonwtnwill challenges. Bring yhoauvresatno itmhemneedwiatEenatenrdplroisnign-gteFrammiimliepsapcrto. gram at Columbia BMuasniangesinsgSacfhaomolilEy xoewcnuetidveanEddoupcaetriaotne,dwehnetreerpyroiuser rceotmurensownitinhvietstomwennt will chBaulsleinnegsess.SBcrhinogolyhEoaxuvhe++rea11csvua22tet11noCCi22vaooit--menhnn88tte55Emiaam44ccnde--tt77meudLL66wciiie11zzaad33SStEtieccian||ohhatnuulleiinllzz,ttr..dzzawsspccttnlrhoohhodieuusggnllrieelttgnoettzz-gn@@sstyttgeoFggaa-rssrruatmttbbermee..ccddrriioomemlttllioouutepddummismaaarbbyynpcpii..aartao..o.eecnddgtuuri.navmesattmCeonlut mwbillia Contact LiwwzwwSwwch..ccuooltlluuzmmtobbiigaae..bbt uussstaiinnreetessssd//tEEoFFday. +1 212-854-7613 | [email protected] www.columbia.business/EF their business challenges.Sourced from the 2016 Columbia Business School Executive Education Global Past Participant Survey

PHOTOGRAPHY: ISTOCK VIEW FROM ASIA-PACIFIC By Susan Lingeswaran TALENT WARS Senior writer, CampdenFB, Campden Wealth Asurge in the number of billionaires has made Asian family offices an El Dorado for wealth managers And it isn’t hard to see how—families lured by the prospect of bigger pay packages and are able to offer more flexibility in more varied work. compensation and incentive packages, What is behind the surge? Explosive wealth whereas in larger institutions, hiring creation in Asia, where 814 billionaires grew their net worth and retention is overseen by a human by a third to $2.7 trillion, according to the latest UBS and PwC resources department with stricter rules Billionaires Insights Report. on salary and bonuses. More than three new billionaires were minted weekly in Last year’s base annual salary for a Asia-Pacific, accounting for more than half of new billionaires family office chief investment officer worldwide. And these new Asian billionaires are competing to and portfolio manager averaged attract the world’s best talent to run their newly set up family $312,000 and $202,000 respectively, offices, which are typically staffed by former investment bankers, according to The Global Family Office hedge fund traders and private equity analysts. Report 2018 by Campden Wealth. On top of it, the two positions got average Vincent Chui, head of Morgan Stanley’s wealth operations in bonus pay outs of 24% and 15%. Asia, told Straits Times in 2018 at least 10 relationship managers had left for family offices, scuppering plans to double their staff. On average, a senior relationship Elsewhere, Tolaram Group, which runs a $500 million family manager at a private bank earned office in Singapore, has hired former Millennium, Goldman Sachs $169,000 in Singapore last year, and United Overseas Bank staff to manage $100 million of the according to the Robert Half family’s cash. Salary Guide. Other family offices in Asia have also poached talent from firms However, a higher pay packet is such as Deutsche Bank AG and Singapore sovereign wealth fund not the only thing persuading wealth GIC, according to media reports. managers to jump ship—the prospect of more varied work, bigger influence 10 CAMPDENFB.COM in decision making and working directly on deals is also a huge motivation. Family offices require employees to have an incredible breadth of skill, which goes beyond just managing and investing assets— they run the family’s full financial well-being, including tax planning, governance, succession and philanthropy. And this myriad of skills make these employees not only valuable, but also extremely rare, with families now finding themselves competing in order to attract and retain the talent required. For family offices, benchmarking the firm’s compensation packages against competitors is one way to ensure it is an attractive option, while rewards systems can keep talent on board, says Catherine Grum, head of family office services at KPMG. But with a shortage of experienced talent, to serve the burgeoning Asian family office space, families may find themselves having to pay out more than ever to attract, retain and support their staff or risk losing staff to rival family offices. ISSUE 75 | 2019

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VIEW FROM THE GULF By Ziad Salloum Ziad Salloum, KSS, is a partner with Salloum & Partners LLC in Abu Dhabi. Since joining his father’s firm in 2006, Ziad has advised hundreds of businesses in every sector, including mergers and acquisitions, dispute resolution, family business succession planning, and the setup of family offices. ILLUSTRATTION: SHUTTERSTOCK In dealing with principals, the next generation may also find themselves FOUNDERS VERSUS NEXT stifled, or with their personality and GENERATIONS WITH authority constantly challenged. $1 TRILLION AT STAKE Mature well-established businesses where “boring is profitable” are The coming decade will see a transition event hit a majority generally less disposed to innovating. of family businesses in the Gulf Cooperation Council Family members often have to work region. This may represent a change of hands of business harder to be respected by employees. assets of about $1 trillion, according to the Family Business Council—Gulf. The next generation’s greater However, family businesses in the region appear to be seeing emphasis on personal fulfilment may decreasing levels of management or operational involvement by the also elicit sharp reactions from the next generation. older generations, a possible legacy of harsher times or cultural norms. A common complaint by principals is members of the next generation are not interested or otherwise capable. The older generation may Any absence or lack of involvement have intentionally limited or discouraged the involvement of the next by principals during the next generation, preferring to employ professional managers. For some, this generation’s formative years may lead was aimed at avoiding potential problems between successors and other to emotional distance or lack of shared next-generation members. Others sought to allow the next generation values, exacerbating communication the opportunity to follow their own path. A more selfish, if not always difficulties and hampering the search conscious, aim may be a desire to focus on the business while avoiding for common ground. intergenerational frictions or entitlement issues. These factors, contrasted with For the well-educated, tech-savvy, ambitious and competent next- the apparent freedom or creativity generation members, personal factors are not the sole cause of lack of associated with an entrepreneurial engagement. lifestyle, may reinforce the perception that expectations Thankfully, an increasingly rare phenomenon is a reluctance of older of next-generation members generations to include women. However, competing visions for the (whether in terms of innovation, future of the business among family members, age gaps, or differences expansion or opportunities for in education, upbringing, culture, experience, or work ethic, serve to personal growth) may not be met frustrate many. within the family business. 12 CAMPDENFB.COM Of course, family members should not join the business for the wrong reasons (like prestige, power, or a sense of obligation). But if principals wish to encourage the involvement of the next generation, they should understand that willing successors need a rationale for staying, especially when they have other options. The importance of early engagement and open communication cannot be understated. The younger generation should be invited to understand the business’s history, philosophy, strategy, and culture. FBs should be open to diversifying or expanding geographically. For their part, the next generation may need to also recognise the importance of strong family ties and buy into the family legacy. ISSUE 75 | 2019

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RAESSTOELEVLYE Third-generation steelmakers Radha Smelters have had their fair share of ups and downs, which is why educating the next generation, mixed with on-the-job experience, is so highly prized. Nicholas Moody reports 14 CAMPDENFB.COM ISSUE 75 | 2019

PROFILE India’s steel industry is not for the fainthearted. On the front line of global trade battles between some of the world’s largest economies, the recent spike in cheap steel imports from other Asian countries, alongside allegations of Chinese ‘dumping’, forced the price of steel in India to drop more than 10% between October and December last year. Meanwhile US exports have narrowed thanks to extra duties. Add in competition from the likes of domestic giants JSW Steel and Tata Steel, plus the daily price fluctuations for steel-making’s raw materials, and you have a cocktail of potential business headaches. Considering all the competition, Suman Saraf is remarkably calm. Saraf is the managing director, and his brother Sunil the chairman, of Radha Smelters—the third-generation steelmaker set up by their father, Shri Radheshyam Ji Saraf in Hyderabad in 1966—best-known by its Radha TMT brand. CAMPDENFB.COM 15

PROFILE “It has been a long journey,” admits Suman. Above: “Quality is the top priority,” says Suman. “There have been ups and downs.” Suman Saraf “Making profits is not important to me. Profits will (pictured) flow if you provide a good product, that is the entire In 1996 the Saraf family went public with one of and his value system which has been inculcated from my its companies based on Taiwanese technology. brother father to me, and from me to my next generation.” Sunil Saraf “But we didn’t get the right people to run it, so in continue Despite the flood of cheap imports, there are 1998 we sold that listed unit to one of the big steel the legacy reasons to be cheerful: “The market is booming,” conglomerates in Hyderabad and we regrouped of their late enthuses Suman. “The latest government central the group into a much bigger focus with better founding budget has provided six lakh crores rupees ($87 technology in 2000 under the name Radha TMT,” father Shri billion) for infrastructure development. A slew Suman explains. Radheshyam of measures to boost domestic manufacturing, Ji Saraf smart cities, higher expenditures on railways, and The next test came almost a decade later. From affordable housing will create a lot of demand for 2008 to 2015, 80% of the steel industry closed in steel, so the future looks very bright.” Andhra Pradesh—the region formerly governed by Hyderabad. This demand has pushed annual revenues for Radha TMT to INR 550 crore ($80 million), “The market was very bad,” recalls Suman. which saw total revenues top out at INR 1,000 “Cheap steel was being dumped from China, so crore rupees ($145 million) when combined with it was a very tough period. But we survived it and the family’s other businesses that invest in real came out stronger because we never over-leveraged estate and construction “in a big way”. Their our assets. We always believed in limited funding non-steel investments involve buying up non- from the banks,” he says. performing assets from banks, typically factories, selling off the machinery, and keeping the land to Today Radha TMT 550 is the brand name of capitalise on its increasing value. their thermo-mechanically-treated (TMT) steel bars that use revolutionary German Thermex technology to produce high-quality primary steel. Their products get used in a wide range of construction projects from roads and dams, to high-rise buildings, and residential housing. It has two fully-fledged, state-of-the-art manufacturing units at Shankarampet, Chegunta village in the Medak district and in the industrial belt at Nacharam, Hyderabad that include steel melting induction furnaces, fully automated hi-speed rolling mills, continuous casting machines, and world-class testing facilities. CLASSROOM AND BOARDROOM The Saraf family may have diversified away from a sole reliance on steelmaking, but the operating business demands focused attention from Suman, Sunil, and the third generation who are either working in the business, or completing education. Suman’s day-to-day responsibilities involve building Radha TMT into a national brand, while Sunil is focused on purchasing the raw materials required 16 CAMPDENFB.COM ISSUE 75 | 2019

for steelmaking. Sunil’s oldest son, Snehil (30), Making profits is not is now chief executive of Radha Smelters having important to me. Profits graduated in 2009 from Purdue University in will flow if you provide a the US with a Bachelor of Science in Accounting good product, that is the with Finance and worked as an equity analyst at entire value system which Batlivala and Karani Securities. has been inculcated from my father to me, and from Sunil’s youngest son, Kushaal (26), completed me to my next generation his undergraduate degree at Hyderabad’s Amity University and his MBA from S P Jain School of the office, before they completed their education. Global Management. Meanwhile Suman’s son, “Before I completed my undergraduate studies Akshat (23), completed his undergraduate degree at Indiana University Bloomington. Since late 2017 I would spend three to four hours each day at the he has overseen steel plant operations at Radha office with my father, along with my studies. I do Smelters and is hoping to start his MBA in August not think that was a very good thing. You should 2019 having applied to nine US Ivy League colleges. do one thing with total concentration. For the three boys, my two nephews and my son, I didn’t let them Sunil joined the business in 1985 and Suman in enter the office even during the holidays!” 1988, although with hindsight Suman regrets not pursuing his tertiary education further. This puts him at odds with a lot of Indian families. “It does not happen very much in Indian “My mother wanted me to go to the US and families where the mentality is, ‘We want our boys study, but I always wanted to get into the business back to work’. We place a lot of importance on of manufacturing steel. Immediately after education,” he adds. graduating I started working and I did not go for my MBA. That was a mistake because things could Despite the brothers’ emphasis on formal have been different,” he says. education, nothing can replace on-the-ground experience in India’s notoriously tricky steel business. This experience has shaped his forthright views on next-generation succession into the business— “Steel manufacturing is not an easy business in he didn’t allow his nephews or son to enter the India. We have our own supplier ethical issues in business, even restricting them physically entering our country, so we have to give a lot of personal attention to details. We are not a Tata Steel ISSUE 75 | 2019 where they can move to having 100% non-family executives. We do have a professional set up, but major decisions have to be taken by us.” Indeed Radha Smelters has professional managers overseeing the steel plants, and a professionalised office including a chief financial officer, president of sales, and other key functions, but purchase of raw material is taken care of by Sunil and Suman. “Steel is a very fluctuating commodity. Like the stock market, the price of steel changes every hour. A non-family executive cannot catch the market pulse as well as we can because of our experience,” he says. Yet the next generation is getting a shot at the responsibility. Snehil has now been trained over the past five years so he can helm the company for up to a month at a time on his own. “We have been blessed that all the three CAMPDENFB.COM 17

PROFILE Left: The branded thermo-mechanically- treated steel bars which Radha Smelters produces Opposite top: The family firm’s state-of-the- art manufacturing units include steel melting induction furnaces, a fully automated hi-speed rolling mill, continuous casting machines and world-class testing facilities to make high- quality primary steel FAMILY BUSINESSES Dr Kavil Ramachandran, executive LOSE THEIR LUSTRE? director of Thomas Schmidheiny Centre for Family Enterprise at Succession in India is at a business to the next generation. the Indian School of Business, crossroads. The PwC India Next The findings suggest a mismatch agrees that Indian society is Gen Study 2018 reported 50% of in expectations between the undergoing major changes. The next the next generation said they expect current owners and those set to generation, in general, are feeling to manage the business one day, take over. Anecdotal evidence less responsibility for continuing though only 19% acknowledged also suggests that a growing their family‘s legacy, he notes. that this had been agreed with the number of the Indian next- “Educated youth are not inclined current generation. generation are passing over to “sweat it out” in a medium- the option of joining their family sized manufacturing company or At the same time, a 2016 PwC study business, in favour of following their a traditional distribution business, found only 35% of the current own pathways as entrepreneurs. such as automobile leadership. generation plan to hand over the Which path will they take? With growing entrepreneurial opportunities and the urge to have 18 CAMPDENFB.COM ISSUE 75 | 2019

children, in spite of their wealth, are very well- He is concerned by what he sees in other balanced and hardworking. They can work from families. “[These next generation] are wielding 8am to 10pm. That is what is what we feel is a basic the power of the money to have the position, but achievement that we have done. Our children are so without having good knowledge of the industry. focused on the business,” Suman adds. If you have to be a master of an industry you have to start at the bottom. You cannot learn this at “We have seen everything in life,” he says. business school.” “We have made mistakes and we have learnt from them.” TRUE VALUES Suman points to the example of Vijay Mallya, the What advice would he give to other family multimillionaire former chairman of United Spirits businesses who are bringing their next generation and self-proclaimed “King of the Good Times”, into the business? There is a lot of new money so “The thinking of the next generation differs children are not as dedicated as from family to family. We were fortunate that our they should be if they want to take children are very grounded, so we did not have the group forward. They don't much difficulty in moulding them,” he says. want to grow the business, they want to inherit a business But Suman is critical of the increasing unwillingness of the next generation of Indian families to start from the shop floor (see box out). “There is a lot of new money so children are not as dedicated as they should be if they want to take the group forward. They don’t want to grow the business, they want to inherit a business,” he says. freedom to pursue their passion, unwillingness of the next generation her family business, or learning youngsters prefer to go [out] on their of Indian families to work their way up the ropes of the business from own,” he says. This is particularly from the shop floor (see main feature). the bottom up. Gada says this so in families with internal strife. can reflect a genuine lack of However, there can be more scope in “[These next generation] are interest from the next generation large family businesses to be more wielding the power of the money to member, or the need for a formal entrepreneurial, says Ramachandran. have the [executive] positions, but succession process to groom them without having good knowledge for business operations. “We find a huge drive towards of the industry. If you have to be a determining their own destiny master of an industry you have to “At times, it is a conflict between without feeling guilty about the start at the bottom.You cannot learn what one perceives as a joy implications for the preservation of this at business school,” he says. versus a pursuit of success in that which they inherited,” he adds. a family business,” says Gada. Vishal Gada, a partner at Dhruva His recommendation? “Every Suman Saraf, managing director Advisors, encounters situations family needs to create a of Radha Smelters, is one of where a second generation member developmental and mentoring those critical of the increasing is ambivalent about joining his or plan for its future leaders.” ISSUE 75 | 2019 CAMPDENFB.COM 19

PROFILE who is facing extradition charges to India to face 700km from Hyderabad. allegations of fraud. “My brother told him, ‘We will set up a INR Mallya inherited India’s United Breweries 3,000 crore plant, but only if you spend one year at the age of 28 when his father died and led on the shop floor of the factory’. After spending it on an ambitious expansion strategy into a one year in the factory he decided it was not as easy variety of sectors including aviation, real estate, as it was in the books. There are no Mills & Boon and fertiliser. His empire has crumbled since stories in real life,” he adds. Kingfisher Airlines’ collapse in 2012 with 17 Indian banks trying to collect INR 9,000 crore How then is it working with your brother? ($1.3 billion) in outstanding loans. “We work from the same office and we get along very well. We have our own conflicts. They “There were a lot of profitable companies under do happen when some decisions he supports, I [Mallya’s] belt. But the value systems were not there do not—that is bound to happen. But 99% of the and he went into too much glamour, which is the time we see that one plus one is equal to eleven, case with most big Indian families these days,” not two.” Suman warns. The brothers have a succession plan in mind, but it is too early to engage in formal planning, he says. “[The next generation] want to do their own “We still have four to five years to work on that, things, some are successful, some are not. We hear but we will start with advisory services on how the success stories, but we do not hear the millions to do the succession plan. We need professionals of unsuccessful ones. There may be millions of to guide us through the process. We have started unsuccessful stories, but they hear one success story thinking about it to reduce the conflict in the next and the nextgeneration come to take that as the generation,” he adds. benchmark to say, ‘We can do that’ with starts-ups As our conversation draws to a close, what are also. We can think of Uber, Amazon etc, but so many the greatest challenges and opportunities he sees for start-ups have failed, how many unsuccessful stories family businesses in India? are there? So many brilliant minds have failed.” “The main challenge for family businesses in India is if anyone has an inflated ego. That should “I feel a lot of mentoring is required for the be controlled. If that is controlled then there are next generation to take the business to the next no issues that a family business cannot face. One level. Just studying in business schools without plus one plus one is not three, it is 111. It is very experience, without industry knowledge, I do not difficult to control today’s generation from feel that the business can be grown by the next conflicts, but we have always tried to tell them generation. They have to be mentored,” he says. that you will grow only if you are united and keep your egos in check.” Suman recounts how his nephew, Snehil, was adamant he wanted to spend INR 300 crore ($44 ISSUE 75 | 2019 million) setting up a pelletisation power project 20 CAMPDENFB.COM

NXGThe next generation of family business taking on the world 22 SMART COOKIE Verena Bahlsen, the fourth generation of German biscuit manufacturer Bahlsen, on family values and reinventing food 30 FEVER PITCH How entrepreneur Anirudh Damani channels his family pedigree and US experience to shake-up start-ups in India ISSUE 75 | 2019 CAMPDENFB.COM 21

HERMANN’S founder and fourth-generation entrepreneur Verena Bahlsen Chang the game 22 CAMPDENFB.COM ISSUE 75 | 2019

NXG PROFILE V erena Bahlsen is a rebel. By her such excitement and eagerness about her family’s own admission, the fourth- business that it is hard to believe that until only generation heir to Germany’s recently, she could not identify with the brand at all. renowned cake and biscuit manufacturing dynasty never And who could blame her? In 2016, whilst wanted to work in or around her celebrating the company’s 125th birthday, family’s eponymous business. At any one time she German media declared that as one of the wanted to pursue a career in fashion, hotels, be an country’s first national brands, Bahlsen, and artist, or a writer—anything that would allow her their most famous product—the Leibniz biscuit— to be creative and original. were synonymous with heritage, tradition, and obligation. One of Germany’s largest daily But creativity was definitely not something she newspapers, Süeddeutsche Zeitung, weighed in thought she’d find on Bahlsen’s factory floor. declaring the biscuit a “monument to German design”. Meanwhile, marketing experts opined “I had been taught for so long that business is that after launching 5,000 products, Bahlsen had where originality goes to die,” she muses from her “remained market leaders on the shelves and in office in Berlin. the heart of consumers for over 100 years” and should stick to its traditions. “Business is for grownups—it is rational, it is spreadsheets—it is not a place to express new, Not words a next-generation millennial looking exciting ideas or be dynamic. Total bulls**t of to be original wants to hear. course, but that is honestly what I believed and because of that I never, ever wanted to follow my “Our business is named after our family and in father into it.” Germany there is a super-heavy sense of heritage and so many connotations and expectations of Bahlsen, 25, is refreshingly honest when preservation that comes with it,” she says. It also discussing the mistakes she has made in the has an important fiscal responsibility, employing past. Now, as co-founder of Bahlsen’s new food 2,830 people, with a turnover of €559 million ($671 million) in 2017. ginginnovationunitHERMANN’S,shespeakswith Such was the magnitude of the family name, Verena Bahlsen, next generation entrepreneur Bahlsen’s father, Werner Michael, made the conscious decision to shield his four children and co-founder of food innovation incubator from the business to allow them to grow up without the pressure. The result was that while HERMANN’S, is looking to drive her family’s Bahlsen was free to pursue any career she wanted, the one thing she could not connect with, was the business into the future. She spoke to Susan business she actually owned. Lingeswaran about history, being disruptive, and preserving legacy “It is an industry where things are frozen in time—big manufacturers making things like bread, cakes, pasta, milk that started 100 years ago and doing it all exactly the same ever since. It didn’t resonate with me or my generation who want to do new and exciting things,” she says. A new discovery Things were about to change. Werner Michael’s decision to hand over ownership of the family business to his four children when Bahlsen was just 13-years-old, triggered a series of discussions, which sparked his daughter’s interest. But the move was made primarily, Bahlsen says, to prevent a terrible history repeating itself. Bahlsen’s grandfather, also named Werner, upon his death had given his two sons and daughter— Werner Michael, Lorenz, and Andrea—equal CAMPDENFB.COM 23

NXG PROFILE ownership of the company. It resulted in Top: “So we explored why Hermann [Bahlsen’s great- years of fighting between Werner Michael, HERMANN’S grandfather and founder of the company] built this his brother, and Andrea’s widower Gisbert hosts company when he did, what beliefs it was built on, and if van Nordek, over company management workshops to we can transition those beliefs to today in the same way.” and leadership. get the public to rethink The answers Bahlsen gathered during that family The much-publicised struggle eventually nutrition, meeting turned out to be the turning point for her and a led to the tripartite division of the group products and lightning rod for her creative side. in 1999. Werner Michael kept control of supply chains the family’s iconic Bahlsen brand, Lorenz Below: “I found out Hermann was not a baker—which sounds left to establish snacks-based company Bahlsen’s like a banal fact, but it was a huge discovery for me—I Snacks-World, and van Nordek was handed father, Werner grew up being told that I come from generations of bakers, control of Bahlsen’s Austrian and Swiss Michael, but that was total bulls**t,” she says. subsidiaries, Bahlsen GmbH and Kelly. keen to avoid Then the families ostracised each other. the same In fact, Hermann Bahlsen was a merchant who travelled Still to this day, the families do not speak. succession around the world in the 1890s, finding ideas for products, issues he technologies, and businesses. All the ideas he found he “My father was super concerned the faced, handed would bring back to his factory in Hanover, including same thing would happen to us so he gave ownership installing a conveyor belt system he had seen abattoirs use the company to us really early,” she says. of the family in Chicago’s meat packing industry. business to Aware that he and his children were Verena at the “Hermann was brilliant at finding, and I thought if we getting older, at the end of 2015, Werner- age of just 13 do not assume we have a company for baking anymore, Michael gathered his family together to instead we can have a company that is brilliant at finding talk about the succession process. opportunities and using those opportunities to grow as a business,” she says. “He said over the next couple of years I want to talk to you guys about how this “It meant that from then on we could align our transition will go legally—not who runs organisation, the people that work here, and our long-term the company, but what we want to do with strategy on finding instead of just baking. this company in the long run, starting with purpose,” she says. “I found that super exciting.” Big ideas Newly armed with the real history of Hermann and all the possibilities it opened up for her, Bahlsen’s interest in the family business was starting to pique. Problem was, she was stuck in London, bored with the business management course she was studying at King’s College University. That’s 24 CAMPDENFB.COM ISSUE 75 | 2019

when she met Laura Jaspers, Top: Bahlsen named HERMANN’S as a tribute to her former assistant of Werner- named her great-grandfather. Although completely Michael, who was now new project funded by Bahlsen Group, it was decided working for Bahlsen’s UK marketing team. after her great- HERMANN’S would be built as a separate grandfather entity from the family’s business. “One day we were talking about how the mass food and Bahlsen market was being called into question as a whole by a founder “We started talking to mentors, we society that is more aware and critical than ever about Hermann found people in the consultant space who things like sustainability, what ingredients are being used to Bahlsen were working on brand strategies and make food, and what they are prepared to buy,” she says. innovation strategy, we went to strategy workshops, and we saw there was a very “We realised there is so much innovation happening with practical way to build a strategy as a 100% food, but it was not the established industry doing it or daughter company of Bahlsen,” she says. even talking about it—it was tech people, it was scientists, it was bloggers. “Now we have a huge network of entrepreneurs in the innovation space, “We thought, ‘Hang on, if established businesses, like which we call our ecosystem that we Bahlsen, cannot develop innovation themselves, maybe are constantly learning and picking new we can build a company that finds innovation that is ideas from.” happening in the market, import it, connect it with an established business, and help make it useable within The result is a hip, dog-friendly, creative their company’.” space in Berlin—a consultancy, platform, and restaurant—all working in harmony With an established food business behind her, and to bridge the gap between start-ups and resources at her fingertips, Bahlsen thought she was in big business. The consultancy finds food the perfect position to marry the two concepts, and make innovations to import and works with money doing it. established businesses to adapt it for production. The platform, Bahlsen says, She summarily quit her degree at King’s College and is to get the industry to rethink nutrition, together with Jaspers, got to work creating their business, products and supply chains, as well as tackle big challenges facing the industry, Hermann was brilliant at finding, and I such as sustainability and waste. thought if we do not assume we have a company for baking anymore, instead we But the star of the show is its restaurant, can have a company that is brilliant at finding which Bahlsen uses to reach out to the opportunities and using those opportunities to public and where HERMANN’S can grow as a business test new innovations on consumers. It holds regular events, hosting guest chefs to exhibit their creative ideas on a willing audience, and runs workshops about alternative ingredients. Only earlier this year, guests were invited to HERMANN’S to experience a six course zero-waste dinner, created by the team at Restaurant Nolla in Helsinki. The concept has stirred enthusiasm in Berlin. Daily newspaper Berliner Zeitung called it “revolutionary”, while food website Essen and Trinken opined that with food waste, sustainability, and plastic use now firmly in the public conscience, HERMANN’S is a necessity. Since then, food enthusiasts have come in droves, curious to learn more about the future of food. “That is the best bit—when people ISSUE 75 | 2019 CAMPDENFB.COM 25

NXG PROFILE come here, they do not just eat the food, Top: We sell biscuits and cakes that they think deeply about it, they discuss it,” HERMANN’S use flour, sugar and eggs, but I Bahlsen says. restaurant is was trying to find alternatives the star of to flours, sugars, and sustainable “We are trying to break down barriers the show, and packaging they didn´t get it and it is not only people in the industry Bahlsen uses we want to convince, we want to start a it to test new the moment our team back at home [in Hanover] got conversation with the public.” creations on interested,” she says. consumers Rebel without a cause and host Such was the board’s turnaround, HERMANN’S was guest chefs quickly brought into the family business, and a separate But while Bahlsen excitedly established Below: Bahlsen innovation arm, TET Ventures, was established to her new venture in Berlin, not works regularly invest in new innovation companies, and launch its own everyone was pleased with what she with two innovative products. was doing—especially the Bahlsen’s coaches to board back in Hanover. challenge her “Bahlsen is now set up like Google is—on one hand thinking and you have the core business that is making money and you “There was zero understanding why strategy have the other, in our case TET Ventures, that focuses on something like this was needed and people exploring new business models that hopefully become your thought I was calling into question the future core business,” she says. value of our existing business and the way they do things because I was building an Stepping up entity that was rethinking it,” she says. Surprisingly for Bahlsen, this whirlwind entry into her “We sell biscuits and cakes that use family’s business came more naturally than she ever flour, sugar and eggs, but I was trying to find alternatives to flours, sugars, and thought possible. Looking back, sustainable packaging—they however, she says the relationship with didn’t get it.” her father, and how they interacted, sowed the seeds for her eventual role. There was no reasoning with the team, Bahlsen says. “I remember when I was 15 and Getting HERMANN’S off on summer holidays in the US, my the ground was down to father and I used to wander around the the fact she had complete supermarkets and discuss packaging backing from her father, design, talk about new products and who had always been open to new ideas. “What is special about family companies is that both my father and I, all we truly care about is sustaining this business long term and creating a business that endures beyond our generation,” she says. “There were constant exchanges with my father and constant reassurances that ‘Yes, I was calling his business into question, but I was doing it in the interest of the whole Bahlsen Group’. “There was no way that I could convince our existing business to back me.” But once HERMANN’S was up and running things started to change. “Once HERMANN’S was not just an idea, but something you could see, engage with, and actually taste, that was 26 CAMPDENFB.COM ISSUE 75 | 2019

Top: Bahlsen But perhaps the biggest role she has wants to to contend with is the futureproofing of develop Bahlsen Group. With Werner Michael HERMANN’S retired from the operational business since into a small 2018, and a non-family executive installed boutique to run the company, Bahlsen has switched consulting her immediate focus to working with her company, father to figure out the long-term strategy helping the of the family business. food industry transform itself As a next-generation disrupter pushing for the future for innovation to be at the heart of the Bahlsen business model, she has her work what kind of flavours were becoming cool,” she says. cut out for her. “We shared this complete natural love for this business “Family businesses have the challenge and I did not realise at the time how unique that was, it of being around for generations and the was just something I did with my father—we bonded over next generation feel an enormous pressure food, products, and brands.” to protect what is there and are taught protecting it means leaving it exactly the But while jumping into the food industry was easy way it is,” Bahlsen says. for Bahlsen, with no formal training, she needed some help transitioning to being an entrepreneur. She still “But that is completely wrong— works regularly with two coaches—one organisational developing and changing the business is the psychologist and one personal coach—to challenge her only way to preserve and honour it.” thinking and strategy. So what’s next for Bahlsen? With her “I have been working in this job for four years now and siblings not involved in the family business, I discovered the biggest inhibitor to my own success was will it be down to her to eventually take trying to copy my father—I was killing myself trying to the helm? emulate him. I am not like him, I am an introvert, and I find meetings with lots of people extremely stressful,” she says. “Right now, I do not have an ambition to run the family business operationally, but “My biggest ‘Ah ha’ moment was realising that it is also, the decision of succession is not up to totally okay and there are millions of different ways of me,” she says. being an entrepreneur and it is a mistake to think that to honour my father’s legacy I have to copy him.” “I just want to do what I feel is important and exciting, and I still have And it is that epiphany that Bahlsen hopes will inspire so much to learn. her in the future. In the next five years, she wants to shape HERMANN’S into a small boutique consulting company, “So it is all to play for, as they say.” helping the traditional food industry transition itself into being more dynamic. ISSUE 75 | 2019 CAMPDENFB.COM 27

MARKET INSIGHT In safe hands The private jet market can seem a crowded and In simple terms the quality of the clients, the confusing place. Shawn Vick, chief executive of quality of the assets, a recognition that the Global Jet Capital, provides some much needed space was underserved by true industry experts, clarity on business aviation and our collective passion for business aviation. You have a long history in business WE HAVE A The clients and owners of these aircraft are aviation, so can you tell me a little RICH PEDIGREE a global collective of successful entrepreneurs more about the market in general? AND PASSION and business leaders. A typical business jet Business aviation has experienced a steady FOR BUSINESS will have three to five owners during its growth path going back to the original AVIATION THAT lifecycle. This means we can underwrite credit Learjet in the 1960s. Heading into the 2000s, POSITIONS to very high-quality clients, and then when the massive explosion of global wealth US TO DELIVER their term with that aircraft is done, as is the drove demand, new product development BESPOKE case with an operating lease, we take this and aircraft production as new programmes SOLUTIONS high-quality asset, and we redeploy it into like fractional ownership provided access THAT MEET another lease or loan. to business jets at lower price points. OUR CLIENTS’ These dynamics spurred a significant UNIQUE NEEDS Historically, this space has been served overproduction of aircraft that, following by banks—who in many cases will finance the great recession, resulted in a true buyers’ an aircraft as part of a broader client market as residual values fell precipitously. relationship. The synergies are obvious, but these are unique assets operating in a unique Today, following several years of collective market. Our clients are typically looking for growth in the developed economies more than just access to capital. They are around the globe, demand is again on the looking for expertise that will assist them in rise but the balance with supply is much accessing an aircraft while protecting capital, healthier. That balance is driven by prudent reducing residual value risk, and maintaining decisions taken by the original equipment the flexibility to quickly and easily upgrade manufacturers (OEMs), such as Bombardier, without having to deal with the vagaries of Dassault, Embraer, Gulfstream, and spot-market conditions. Textron, to reduce their production rates in tighter alignment with demand. Lastly, we have a rich pedigree and passion for business aviation that positions us to Can you share a little bit about the deliver bespoke solutions that meet our Global Jet Capital concept; what clients’ unique needs. attracted you and the investors to business jet financing? There are different ways to own and finance business jets, can you tell me more about the different options and associated pros and cons? Today a wide variety of solutions for private aircraft transportation exist, but I think it’s easiest to consider three categories: charter, fractional ownership, and whole ownership. 28 CAMPDENFB.COM ISSUE 75 | 2019

Left: Shawn Vick, chief executive of Global Jet Capital The lowest level of commitment is a basic What are the key things for one trip charter, but you can also buy into families to think about when block charter programmes and jet cards, which considering financing an aircraft? represent a larger commitment by contracting What are the pitfalls? for a certain number of hours during the year. Each one of these transactions is unique and Next is fractional ownership, which involves discrete in and of itself, and clients need to both the acquisition of the fraction and hourly know their specific needs are being understood cost while onboard the airplane, as well as a and addressed. But against that backdrop are monthly management cost. Finally, you have some basic concepts related to tying up capital whole aircraft ownership. in a depreciating aircraft or asset, residual value risk, and the potential complexity With respect to financing whole aircraft associated with ultimately disposing of the ownership, while the structure of each asset. It has been our experience that if careful agreement can have significant complexity and consideration is given to each of these elements uniqueness it is fair to say clients are either there is a successful outcome. using their own capital, entering into a debt or loan structure, or entering into an operating What is your most valuable advice Global Jet Capital lease—which seems to be gaining in popularity. to a family that wants to buy or Corporate offices: finance an aircraft? 83 Wooster Heights, What are some of the common Relying on someone—colleague, friend, or Suite 503, misconceptions about business family member—with a passing interest or Danbury, aviation that you help clients clarify? experience with business aviation can lead to CT 06810 One of the most common misconceptions a challenging experience. Find an accredited, United States is that the expense associated with business high-integrity, experienced adviser, and 2500 North Military aviation is impractical. In fact, if you have a perform your due diligence. Be sure you are Trail, constrained schedule with a multi-city agenda, being heard and understood. Business aircraft Suite 475 Boca Raton, in a short time the economies of scale kick in are unique productivity and time-saving tools, FL 33431 and it can be a very economical solution. What the right guidance up front can ensure you take United States could take you weeks on commercial airlines full advantage and enjoy a quality experience. +001 844 436 8200 can take days on your own plane. info@globaljet capital.com ISSUE 75 | 2019 CAMPDENFB.COM 29

MY BUSINESSNXG Opportunity knocks A start as a door-to-door salesman in Texas has given next-generation angel investor and fourth-generation entrepreneur Anirudh Damani a unique perspective on business. Susan Lingeswaran finds out how I WAS A ANIRUDH DAMANI hospitality—generating contracts,” Damani DOOR-TO-DOOR has a family history more than $50 million explains from his office SALESMAN FOR studded with a serious revenue last year. in Mumbai. A COMPANY IN entrepreneurial TEXAS SELLING pedigree. A perfect place for a “We were trying to PREMIUM next-generation with a help businesses and ENERGY His great grandfather dream of investing in homeowners cut their CONTRACTS Shri Chunnilal Damani start-ups to learn the power costs by selling was a reputed bullion ropes, you would think. them higher rates, but trader in India, while his But after graduating from at a fixed price. Back father and uncle, Ashok Austin College in Texas then it was a very new and Ramesh, both former with a degree in Business concept and there was no Bombay Stock Exchange Administration and other way to sell it but directors, are hailed as Economics in 2005, the to literally go to people’s two of the most successful younger Damani’s first job homes and explain the investors in the country. could not have been further concept face-to-face.” from the family business. Using their family office, The matter-of-fact and K Damani Group, they “I was a door-to-door energetic way 35-year- have invested heavily in real salesman for a company old Damani tells his estate, stockbroking and in Texas [Pioneer story speaks volumes Energy Resources] about how he thrived selling premium energy in his new role as a 30 CAMPDENFB.COM ISSUE 75 | 2019

I GOT TOGETHER WITH A COUPLE OF FRIENDS AND PULLED OUR CAPITAL TOGETHER Opposite page salesman. His penchant for left: Damani communication saw him exploring go from knocking on 80 to potential sites 100 doors a day to leading to set up low the company’s expansion cost movie into new states and running theatres in 14 offices with 500 field Nepal. people as director of sales. Opposite page above: Damani Unlocking potential evaluating a Things were going well start-up during until 2009 when the a conference in company, owing to the Hong Kong. Great Recession, came to the brink of collapse. That’s when Damani saw an opportunity to buy-out the business and kick start his entrepreneurial career. “I got together with a couple of friends and pulled our capital together and bought the business from our old boss, restructured it and took it down from 14 offices to five,” he says. In under two years, they had not only made the company profitable, but also cleared all the debts of their former employer. Damani was again thriving in his new role as an entrepreneur, dreaming of one day investing into start-ups. PHOTOGRAPHY: COURTESY OF ANIRUDH DAMANI CAMPDENFB.COM 31

NXG So when an opportunity company we were partners THAT IS WHEN I DECIDED TO arose to sell the business with, but again, that was DO MY OWN THING AND LOOK in 2013, he decided it not the right fit for me. INTO INVESTING IN EARLY was time to move on. That is when I decided STAGE COMPANIES His partners, keen to to do my own thing and continue, bought him out look into investing in early and Damani returned to stage companies.” the family office to fulfil his ambitions. However, But selling his dream things didn’t just fall into to the senior Damani place straight away when brothers was the first he returned to his native hurdle he had to overcome. India from the US. As conservative investors, they were not too keen “For a year and a half I on the increased risk that tried my hand at a bunch would go hand-in-hand of the family’s businesses. with investing into early In the stockbroking stage companies. arm—I tried setting up a division to trade in Damani had to get options, but that didn’t creative, and taking work out. I even moved inspiration from Warren to Kolkata for six months Buffett’s bets in renewable to try my hand at the energy, he came up with real estate development a solution that would protect his family’s capital. The family “I used my experience in The proposition behind Damani. the US energy sector and worked and the brothers (L-R) Advait devised a strategy where created the family’s new (nephew), the family would invest investment arm Artha Mridul (sister), a pool of capital into an Group, and within it, Animesh operating business—for Artha Energy Resources, (brother), us, renewable energy to invest in renewable Arvind (brother- assets—and only using energy projects and Artha in-law), Bhawna the revenues from that, we India Ventures, to invest (sister-in-law), would invest into start- in start-ups. Anirudh, Sunita ups,” he says. (mother), and Artha Energy Resources Ashok (father). “So even if the start-up now has a renewable does not do well, there is energy portfolio worth no capital loss, we have $1.2 million, which just not made a return and posted revenue of that’s about it.” $200,000 last year. 32 CAMPDENFB.COM ISSUE 75 | 2019

So far, Damani’s 60 Anirudh investments into start-ups Damani, angel range across India and investor, the US, including unicorn entrepreneur budget hotel chain OYO, and Artha online cosmetics retailer India Ventures Purplle, pregnancy and managing parenting-tips platform partner. BabyChakra, and omni- channel fashion site Fynd—backed by Google. The investments have almost completely been funded by the power generated by their large wind turbine in Rajasthan. Learning curve I include a slide that that combining the back from the US, has Although not all of his discusses our failures, investment philosophies really helped me to build investments have been a how it happened, and of the older generation a different kind of success, and Damani is what the outcome was. I together with the fresh company than is usually candid when exposing think it offers a window ideas he picked up in the seen in India.” what has not worked out into how we look at our US, will ensure the fund and why—even when failures and what we will be kept in check. Back to school pitching to potential Artha have learnt from them. Despite his swift rise, you Venture Fund investors. It makes us relatable, it “When I said I wanted get the sense Damani is makes us human.” to do a fund, my father continually evolving and His investment into and uncle said, ‘Yes as self-improving. When online taxi booking service Far from being deterred long as we always return he is not hunting down BookMyCab.com, ended by these experiences, the capital back, make his next unicorn, he can with Damani only getting Damani has dared to risk sure there is some return, be found using his blog back about 30% of his more by launching the do not put everything at ShowMeDamani.com to original investment via family’s first $30 million risk, and do not work with vent, praise, and shine a company sale. It institutional fund, Artha people you do not trust’. a light on being a young followed a missed Venture Fund-I, last year. entrepreneur—something opportunity to take on “I think investing he believes keeps illegal tourist taxis, which It’s a unconventional with that in mind, plus him grounded. a competitor then swooped move for the family, the western style of in to monetise. but Damani believes management I brought His foray into the discount hotel booking site HotelsAroundYou.com, which was wiped out by competition that brought in deeper discounting, was a complete write off. “I do not shy away [from failures],” Damani says. “In the pitch presentation I show to potential investors, ISSUE 75 | 2019 CAMPDENFB.COM 33

NXG Damani and artificial intelligence, discusses using the same strategy— YOU HAVE entrepreneurship getting in early, writing TO HAVE THE at a newly small cheques, having lots PATIENCE, YOU created incubator of money for follow on HAVE TO HAVE at business investing, having very low THE VISION school IIM costs of operations, and Udaipur. focusing on making money “I’m working in an from interest,” he says. industry that is growing, but has so much mystery “That’s going to be my to it. I feel venture personal work for the next capitalists have a tendency five years to get us from to consider themselves $30 million AUM to $300 demi-gods—we glorify to 500 million AUM. start-ups that made a tonne of money, rather “I’m also creating than start-ups that an entrepreneur school are actually just good because India does not businesses,” he says. have one and we are in the process of bringing one of “I make those mistakes the top schools in the US all the time and I discuss to provide their syllabus these [issues] and different and professors.” theories about the industry with family and Some 13 years after friends, so blogging is an knocking on doors in the outlet that I use to share US, Damani is setting what I find out.” up a bright future for himself and leading his It is this constant family office into new striving for self- territory. But while it is improvement that keeps clear he is proving himself him busy. His current a capable custodian for focus is on investing in his family’s legacy, he says the consumption sector, it is important he does it but in the future he plans incrementally to show the to use his unique strategy older generation he is ready. to expand into new fields. He is even in the process “A lot of it [succession of setting up India’s first planning] is building trust entrepreneur school. with the patriarchs— taking over more “I want to build 10 to 15 responsibilities, earning more micro venture capital their trust, and proving funds that will invest in you can handle what they different verticals, such have built so carefully,” as financial technology he says. 34 CAMPDENFB.COM “You have to have the patience, you have to have the vision and you need to be able to show, through performance, why things should be handed over to you. That is what I’m trying to do now.” ISSUE 75 | 2019

How to achieve best practice in family business for maximum results ACADEMYFB 36 SLOW AND STEADY How to ensure your children grow up to be responsible wealth holders and not the rich kids of Instagram 42 BOOK REVIEWS PHOTOGRAPHY: DREAMSTIME CAMPDENFB.COM 35

FB ACADEMY Sandy Loder is founder of DID GREAT,GREAT, AH Loder Advisers Ltd, a GREAT GRANDPA specialist family consultancy HAVEAN IPAD? business that focuses on family businesses, family offices, and financial and entrepreneurial education. Loder is a fifth-generation member of the Fleming family and worked in the family business for 18 years. AT WHAT AGE SHOULD YOU BEGIN TO SPEAK TO SCHOOL AGE CHILDREN ABOUT GREAT WEALTH? Sandy Loder: There are different approaches in different parts of the world. In the case of first- to-second generation succession, Europeans tend to talk to their children at a much later stage than in the US. In the majority of cases, I am not sure European founder parents ever really fully explain the situation until they are on their death bed or have a critical illness. This is different down the generations, as the wealth is starting to be institutionalised and formalised. My advice on discussing inheriting wealth is to let children be children. Do not burden them with the weight of responsibility until they are mature enough to handle it. With the amount of information that the internet holds, they will soon discover and learn more about their heritage and family wealth. This is learning by osmosis and I think it is a very sensible way for them to slowly learn more and more as they travel through their adolescence. WHAT ARE THE FIRST STEPS? SL: The first step is to give them a debit card that cannot go overdrawn, so they can start to have some autonomy and also learn about managing a regular income of pocket money and earning money for doing chores. The next step will be whether they start to receive money from a trust. Be aware that the more you give them, the more they spend, and you start to eliminate consequence out of their life. As they become adults, then they will legally be required to sign tax returns and other legal forms, so a conversation around their 18th birthday has to take place. My advice would be to let them get through higher education such as university and go out into the world to learn new skills and 36 CAMPDENFB.COM ISSUE 75 | 2019

Talking to your children about wealth can Evana Lithgow is a be enjoyable and preparing them can be psychologist with 19 years’ fun, but there are serious considerations experience. She is the too. Next gens and family experts Sandy managing partner of Working Loder and Evana Lithgow share a host of Minds, a boutique practice useful tips and insights focused on succession, transition, change, and PHOTOGRAPHY: ISTOCK, GETTY IMAGESW growth. Having grown up in a successful family business, Evana brings a unique mix of deep expertise, practical insights, and human-centred solutions to her clients. Evana Lithgow: When speaking with children about wealth can be better to think in stages, rather than ages. In that sense it is never too late to start. Broaching the subject need not be all doom and gloom either. Over the years I have seen families invent some great ways to engage with children, from making books of wisdom for their children, to developing rites of passage experiences for certain ages, and creating family events such as cousin camps and family dinners. AT WHAT AGE SHOULD YOU BEGIN TO SPEAK TO SCHOOL AGE CHILDREN ABOUT GREAT WEALTH? EL: Starting conversations with children about wealth is very much dependent on the child, the family, and their context. That said there is a lot that family, carers, and advisers can do to set these conversations up for success when the ‘time is right’. It might sound basic, but the fundamentals of communication and parenting really apply, such as building a strong relationship and understanding of one another. Understand and appreciate the personality and interests of your child and how these are similar or different to you. Agree with other parental figures and guardians, carers, family members, and advisers how the parents of the child would like the topic approached and why, so that everyone can be ‘on the same page’. Ensure there is regular connection and conversation time so that opportunities from both sides can be leveraged. This might include telling a little more of your family, or personal, story or your child asking you a question about something previously discussed. SHOULD THIS BE DONE BY PARENTS OR SOMEONE WITH SPECIFIC SKILLS? EL: There are real benefits in having more than one person or ‘type’ of person involved in conversations about family wealth. The trick is CAMPDENFB.COM 37

FB ACADEMY experiences. It is in their late Everest. Success means something child is not going to be as wealthy 20s/early 30s that they really start different to everybody. It is not as their parents and therefore to need to earn an income, or necessarily just about making might not receive a higher level of income, money, although that does help be able to afford quite the luxury as they will want to buy their oil the wheels. So go and be that they have grown up with, own house etc. The more serious successful—help build a team of unless they can go out and conversations can take place then, coaches, mentors, and supporters generate it themselves. when they have established their around them. own journey in life. They will be ARE THERE ANY PITFALLS? mature enough to handle the added I am a great fan of teaching SL: Do not shower your children responsibility of inherited wealth. entrepreneurship. It is a fantastic with money. It is not helping and skill to identify a problem or one of the first things I recommend SHOULD THIS BE DONE BY pain in the world and then find PARENTS OR SOMEONE WITH a solution and build a business is to switch off the allowance or SPECIFIC SKILLS? from that. Life is, in many reduce it. SL: This conversation can respects, all about problem- They must have be carried out by parents or solving. However, not everybody consequences in their professional advisers. Remember, is an entrepreneur and records lives, much as the children expect parents to parent show there are very few self-made founder did. So if you and teachers, coaches and mentors second-generation billionaires. do tell them early on to teach, coach, and mentor. about their wealth, Crossing over never works that Then they need to learn how make sure there are well. The children should start to make money and manage that consequences. There must to meet advisers in their 20s money. They need to learn to live be a reason for them to and understand the role they within their own means. get out of bed in the are playing. morning. So many Careers are no longer linear and next-generation family WHAT TOPICS SHOULD YOU START hierarchical. It is about choosing members I come across WITH? HOW DO a direction of travel and moving have no hunger or desire THESE CHANGE from stepping stone to stepping AS THE CHILDREN stone in a random order, learning to change. AGE? skills and picking up experiences. SL: The first Hopefully along the way they thing they will become more successful as need to be they travel in the direction of taught is that their passion. If they follow their they should interests and passion, then they are walk their likely to be more successful and own journey stick at it for longer. or climb their own Wealth dissipates very rapidly down the generations, so children must be aware that each Above: Opposite page: Children learn Responsible wealth entrepreneurship management will at a young age by become essential doing odd jobs for as capital transfers pocket money from baby boomers ISSUE 75 | 2019

to have everyone do ‘their’ role so where the family wealth came from. When appropriate, discuss the it is clarifying, not confusing. For example, how, how much, who’s detail, quantum and mechanics side, how long ago it was created, and of the wealth so there is no Parents should make some time to what has happened since then. This misunderstanding as to what individually reflect on the strengths of is a fantastic opportunity to tell the you mean. their child ahead of any conversations, family story, as well as your story, and as well as anything they believe could we all love a good story. This creates ARE THERE ANY GOLDEN RULES be ‘worked on’. Parents can then further lines of enquiry from your ABOUT BROACHING THE SUBJECT? discuss their hopes, desires, thoughts child. A six-year-old recently asked a EL: When talking to children about and fears for this process first with particularly cute follow-up question: wealth we believe the ‘how’ is just as each other, then with other carers, ‘Did great, great, great grandpa have important as the ‘what’. Start simple family and advisers. This creates an an iPad?’. and small—you can always add more individual plan for their child that information and detail. meets their wishes as well as any WHAT ARE THE MAIN POINTS TO practical considerations from the COMMUNICATE? Layer the conversations, ideally over wider family. Everyone that could EL: Be careful of expecting more a lifetime. It’s an ongoing dialogue, be involved needs to be aware of from your children than you expect not a ‘dump’, which changes with the what, when, where, why and how the of yourself, adopting a ‘cookie cutter’ ages, stages and seasons. parents would like the conversations approach by treating your children the to occur and their specific role and same or comparing them—factor in Be clear about what they can or responsibilities in that. individual differences. can’t share and with who and why. Be careful not to give your children a Be wary of having anyone ‘drinking ‘reason not to believe you’—often this from a firehose’—a little, layered isn’t intentional, sometimes as parents approach often with an opportunity we just get asked a question we didn’t to think, reflect, discover and practice see coming or the question is poorly is preferable to a ‘drenching’. timed from our perspective so we say something to get out of the ‘moment’. Be careful about doing all the talking—sometimes we get nervous Ensure you provide a balanced and fill all gaps with words so no perspective. It isn’t all doom and questions can be asked. Information gloom or burdensome with wealth, isn’t easily or readily digested in these but it isn’t roses and rainbows all day circumstances. long either, as we all have the same human condition. WHAT TOPICS SHOULD YOU START WITH? HOW DO THESE CHANGE AS THE CHILDREN AGE? EL: We often talk about going ‘backwards’ to go forwards. Regardless of your children’s age, the most sensible starting point is what is wealth and understanding ISSUE 75 | 2019 CAMPDENFB.COM 39

MARKET INSIGHT Thematic trends: New ways to diversify and search for long term value Valery Senko, Trendvision AI founder, explains how But as we read in the business its machine learning-driven research tool enables media these thematic trends investors and analysts to harvest global thematic seem to be very well covered by trends in equities and provides solutions for new exchange-traded funds (ETFs)? long term equity allocation decisions We continuously monitor the universe of thematic ETFs which are available. There Why do you think that thematic WE HAVE was indeed a huge growth of ETFs in this trends are more important or DEVELOPED area in terms of a number. Yet the amount in any way better than a simple SOMETHING of money under management still remains value approach, that has been UNIQUE immaterial compared to other ETFs, with successfully implemented by AND VERY very few exceptions. Our view is that it Warren Buffett and multiple VALUABLE is developing this way because most ETF other investors over the years? FOR THEMATIC providers use it more for pure marketing Of course, I agree that a value approach is TRENDS purposes, rather than a real investment something that has proved itself for many INVESTORS instrument. And the key problem here is successful investors. But in a new era of that such thematic ETFs are deploying algorithms and machines this approach similar approaches and end up either with became too popular. In many other an excessive number of companies in its smart-beta cases, the most profitable holdings or a very limited number. opportunities have been taken away by hundreds of investors with the same Another important fact is that there are logic. The Wall Street Journal quoted still very few ETFs in this niche built from Charlie Munger’s idea that you need to and for institutional investors. Our trend be fishing where nobody is fishing. rebalancing methodology might be very useful to resolve this problem. Our initial results show that thematic trends might be a new area of search for Why do you think your above-the-market returns. Particularly portfolios are better than in the coming era of low equity returns, such ETFs? which all the analysts and asset managers Because we use several approaches envision in the next decade. For me, the simultaneously to a very wide universe trend is a more stable and stronger driver of stocks. And results of some than even value criteria on a company comparisons and back-tests are very level. Even more so if you think about the promising. Obviously this is not a portfolio with the key driver or factor. guarantee of future returns, but we It does not mean that we should ignore understand and are ready to discuss with value screen altogether. our clients how to implement certain approaches to capture additional returns from thematic factors. We are currently testing our TRV index, which will provide them with even more actionability. Provided that we have a historical data on composition of ETF, we have functionality to compare any given ETF 40 CAMPDENFB.COM ISSUE 75 | 2019

with our portfolios and, if you have new ideas on Above: Valery Senko, your own portfolio, to dive deeper into where to look for founder of Trendvision AI its thematic aspect. We want to make it opportunities. We easier for analysts, portfolio managers, or can provide extensive Trendvision AI investors to analyse thematic trends and lists of companies 32 Sadovaya-Kudrinskaya Street our tool is a powerful tool for that. influenced by the Moscow trends in seconds. Russia What is the key value you think We have extensive an [email protected] your potential clients get? library of investable I think we open a door to more structured trends, which means analysis of the whole universe of US- that there are equities listed public equities, with global equities that investors can coming next quarter. We start with the consider to invest into proprietary AI/ML algorithms analysing the trend. Our next public information about equities and then milestone will be filter trend lists through certain financial, a release of our TRV index in April. qualitative, sentimental screens that allow the user to get better positioning of the We still are building a global coverage company in a trend, or a view of trends in functionality on publicly available data, a company and its peers. Our library of which is quite challenging due to very trends comprises more than 50 trends. diverse reporting standards. But it is not Of course there is a functionality to a problem for those clients who use well- research unique trends as defined by known financial data providers as we the client. We believe diversification can easily work on their data. through trends might be better than by industries. This opportunity to create Our vision is to build an investment portfolios with a proprietary mix of analytics company on the back of our trends might be appealing. sophisticated proprietary algorithms and approaches that can analyse and What are your further product measure key global trends to help the development goals? investment community better navigate Our tool is a powerful research platform this area in application to public that can save a lot of time and give markets. We have developed something unique and very valuable for thematic trends investors. ISSUE 75 | 2019 CAMPDENFB.COM 41

FB ACADEMY BOOK REVIEWS Your Business–Your PREVIOUS Family–Their Future: REVIEWS RATED How to Ensure your Family Enterprise Thrives for Robert Kuok: ✪✪✪✪✪ Generations A memoir By Robert Kuok with PUBLISHED BY BY EMILY GRIFFITHS-HAMILTON Andrew Tanzer Global Family ›› ✪ ✪ ✪ ✪ ✪ Don’t let the detailed title fool you, at 173 pages this ›› Landmark Books Enterprise concise book is designed to deliver a power-packed ›› 376 pages Advisors punch giving readers a useful entry point for building a multigenerational family enterprise. With a helpful The Wealth Elite PAGES index, extensive bibliography, suggestions, tips and By Rainer 372 strategies, it is based on the common patterns found Zitelmann within successful families. And author Griffiths- ›› ✪ ✪ ✪ ✪ ✪ A Family Business on Hamilton knows what she’s talking about. A third- ›› LID Publishing the Moon generation family member, Emily was the co-owner of ›› 421 pages the Vancouver Canucks, the Vancouver Grizzlies NBA TB Y R A N D E L S C A R L O C K A N D K E N G - F U N L O H basketball team and Vancouver’s Rogers Arena. In Passing the he term ‘ground-breaking’ is generally this, her second book, Griffiths-Hamilton challenges Torch overused however, sometimes an the traditional approach to family business succession By Ilze Alberts exceptional effort is produced that and wealth transition planning which often begins ›› ✪ ✪ ✪ ✪ ✪ raises expectations to a whole new with legally-advised and tax-driven structures. She ›› Wiley level. A Family Business on the Moon advocates a clear and practical way to overcome the ›› 165 pages has done just that. It is almost as far removed primary reasons behind failed succession and wealth from the concept of a traditional family business transition plans. The book is a sound compass to help READ ALL PREVIOUS book as you can get. And that was the intention families successfully navigate their way forward. REVIEWS AT of INSEAD Prof Randel Carlock and family expert Keng-Fun Loh, who have poured RATED PUBLISHED BY PAGES CAMPDENFB.COM five decades of fun, practical exercises, and Figure 1 Publishing 173 imagination into their fieldbook. A visual feast, ✪✪✪✪✪ with more than 70 illustrations by Ruth Gwily who illustrates for publications from The Four Steps Washington Post to The New Yorker, it continues to Flow to draw you back and through the book. Yet the 24 practical exercises taking you through the BY FEISAL ALIBHAI Parallel Planning Process give a huge amount of substance to the dynamic style that will keep you Feisal Alibhai may be familiar to regular readers of coming back again and again. In short it is a CampdenFB having contributed a number of pieces must-read for families and advisers. in previous editions. His background running his family’s fast-moving consumer goods distributor in 15 countries prepared him for financial success, but left him lacking in the skills needed to manage the change inherent in life outside work. In this, his first book, Alibhai challenges the idea that the rational ‘head’ and emotional ‘heart’ must be in competition. He argues that uniting head and heart is a four-step process designed to move into a state of ‘flow’. An intensely personal book, Alibhai acts as a companion, guiding readers through the process he has devised in a book littered with anecdotes and written in his own engaging and personable style. If your heart and head have ever wrestled over a challenge then Four Steps to Flow is for you. RATED PUBLISHED BY PAGES Qineticare 221 ✪✪✪✪✪ 42 CAMPDENFB.COM ISSUE 75 | 2019

RESEARCHUp close and personal with the trailblazers and latest trends in family business + RANKINGS 46 75 FOR 75 We reveal the 75 most dynamic, influential and successful family business leaders across CampdenFB’s 75 issues 64 ENTER THE DRAGON How family business fits into the Chinese economic powerhouse PHOTOGRAPHY: ISTOCK CAMPDENFB.COM 43

HITRESEARCH + RANKINGS LIST What better way to celebrate 75 editions than to look back at some of the notable and memorable covers. Here’s a selection of some of the landmark editions ISSUE 1 Families in Business launches with a profile of Italy’s Indesit- owning Merloni family then focuses on the Italian family sector, and Italian fashion families, including Zegna. AUTUMN 2001 ISSUE 20 MAY/ US travel and hospitality JUNE icon Marilyn Carlson Nelson 2005 is the first female Families in Business star, plus good governance for stakeholders’ fair share, private equity solutions, and preparing heirs for succession. SEPT/ ISSUE 50 OCT Our first decade 2008 retrospective, plus we interviewed the ISSUE 40 next generation of The magazine is renamed CampdenFB and its Swiss Army knife first edition interviews Pamela Mars-Wright, with makers Victorinox, spotlights on family business in Eastern Europe, the French families selling the family business, and crisis management. of luxury, 40 to watch under 40, and SUMMER art restitution. 2011 ISSUE 75 | 2019 44 CAMPDENFB.COM

WINTER 2014 SUMMER ISSUE 59 ISSUE 60 2013 Agnelli heir John Elkann on Brothers Majid and Badr Jafar his and non-family executive on good Gulf family business Sergio Marchionne’s governance, Warsteiner’s rescue of Fiat Chrysler, it’s ninth-generation chief show time with Angels the executive Catharina Cramer on Costumiers, and getting modernisation, 60 events that women on boards. shaped family business. ISSUE 69 WINTER Will Trump make US 2017 family business great again? James Ferragamo on family legacy, how mental health is affecting the next generation, and Saudi Arabian families. SPRING 2017 SPRING ISSUE 53 ISSUE 74 2012 Sixth-generation patriarch Award-winning rising star Lydia Forte, Baron David de Rothschild of Rocco Forte Hotels, in her own right, on family, the bank and plus Ray White Group’s Australasian wine, divorce and the real estate success, and MANE Group family business; Bill Yoh, principal Jean Mane’s leadership tips. of US engineering group Day & Zimmermann, talks stewardship. ISSUE 70 Kohler family inspiration and philanthropy, C&A fifth-generation Stephen Brenninkmeijer’s impact investments, Sri Lankan next-generation Dilhan C Fernando on Dilmah Tea ambitions. SPRING 2018 ISSUE 75 | 2019 CAMPDENFB.COM 45

Top 75 leadersfamily business 2019 METHODOLOGY CampdenFB drew up a long list of more than 100 family business leaders across the globe from a wide range of sources, from reviewing previous top leaders’ lists from CampdenFB and stories published on CampdenFB.com, to trawling through our archive. We selected on the basis of the following criteria: CampdenFB has featured many of the leading lights in the family • The candidate(s) showed business and family office space over its 75 issues. Here we take a adherence to exceptional look at some of the icons in the world of business families plus the corporate governance and up-and-comers taking the community into the 21st century succession planning Over the past 75 issues, CampdenFB has had reflect on our wide cast of characters. The • The candidate(s) showed the pleasure of featuring list is not supposed to be exhaustive, and outstanding entrepreneurial literally hundreds of in fact we had to make a couple of very talent in the context of the hard decisions on who to include, however family business fascinating family it is supposed to reflect a varied mix of the • T he candidate(s) has been crucial to the successful businesses that we have scoured the globe established icons of family business right running of the business in the last five years and helped to to uncover. So to mark our 75th edition we through to some lesser-known rising stars. underpin its revenue growth and profitability decided it would be a great opportunity to Welcome to our ’75 for 75’. • The family business has avoided any major scandals in the recent past The family business also had to meet certain criteria: • The family controls at least 25% of the company’s decision-making rights • T he share capital controlled by the family is at least in its second generation • The company had revenues of at least $100 million 46 CAMPDENFB.COM ISSUE 75 | 2019

RESEARCH + RANKINGS asia Pacific SABRINA ADRIAN MUKESH JAIME VICTOR AND CHAO CHENG AMBANI AUGUSTO WILLIAM ZÓBEL DE FUNG Chairwoman Executive vice C hairman and AYALA Wah Kwong Group chairman / chairman and managing director C hairman and chief Maritime Transport managing director general manager Reliance Industries executive Holdings New World Group Li & Fung India Ayala Corporation Hong Kong Hong Kong Ambani chairs Hong Kong Chao is the Grandson of energy to retail Philippines Third-generation granddaughter of founder Chen giant Reliance Seventh- siblings Victor TY Chao, founder Yu Tung, Cheng Industries which generation Zóbel and William of Hong Kong’s is the third- generated $89 de Ayala took over run Li & Fung, shipping group generation heir billion in revenues the Philippines’ a middleman Wah Kwong. of one of China’s in 2019. Ambani largest between Chinese After graduating most influential worked alongside conglomerate manufacturers from the Imperial families and his father and from his father, and retailers College University the mastermind founder of Jaime, as in the US and of London and a behind Chow Tai the company, chairman and Europe. Co- career in finance Fook, one of the Dhirubhai chief executive in founded by their and shipping, she world’s leading Ambani, starting 2006. Starting as grandfather, Fung joined the family jewellery brands, in 1981. Together, a small distillery, Pak-liu in 1906, firm in 2002 and which posted the duo expanded Ayala is now a the business has was appointed a revenue of the business to holding company become one of chairwoman in HKD59.2 billion provide telec- for Ayala Land, the world’s largest 2013. Only two ($7.5 billion) last ommunications Bank of the suppliers of years later, Chao year. Prior to through its 4G Philippine Islands, clothes and toys. was elected chair taking over from phone service Globe Telecom, With $18.3 billion of the Hong his father, Henry, Jio and launched and Manila revenue posted Kong Shipowners Cheng worked at India’s largest Water, which in 2015, the Association, the Goldman Sachs retailer, Reliance posted revenues company works first woman to and Credit Suisse Retail. After of PHP242 billion with some 15,000 take the position. as an investment Dhirubhai’s death ($4.61 billion) in factories in over She is a trustee banker. His sister, in 2002, Ambani 2017. Zóbel de 40 countries. of the Hong Sonia, oversees and his brother Ayala is highly Victor’s son Kong Maritime the family’s Anil split up the regarded as a Spencer succeeded Museum, among hospitality arm, family empire, leader and has as chief executive several non-profit Rosewood Hotels and Ambani been named best in 2014, and roles. and Resorts, and gained control chief executive by his other three plans to open 40 of Reliance Finance Asia and children also work hotels by 2020. Industries won CNBC’s Asia for the family and Indian Business Leader business. Petrochemicals Corporation. ISSUE 75 | 2019 CAMPDENFB.COM 47

ADI GODREJ SHOSUKE LI KA-SHING RICHARD LIU AZIM PREMJI IDEMITSU Chairman Senior Adviser C hairman and chief Chairman Chairman emeritus C K Hutchison Godrej Group executive Wipro Idemitsu Kosan Holdings India JD.com India Godrej chairs Japan Hong Kong Indian technology the $4.5 billion Second-generation Nicknamed China magnate Premji’s revenue- Idemitsu heads ‘Superman’, Liu is the founder, $8.4 billion generating Godrej Japanese oil Li Ka-Shing is chairman, and company Wipro Group, a family wholesaler revered as one chief executive is India’s third- conglomerate Idemitsu Kosan, of the most of Chinese largest outsourcer. founded by his with revenues of influential e-commerce Premji left his grandfather $32.1 billion. Last businessmen in firm JD.com. He studies in 1966 Ardeshir Godrej, year, the family Asia, presiding opened his first to take over the in 1897. The led by Idemitsu, over a diverse electrical goods family’s cooking family business which has a portfolio from store, in 1998 oil business after spans real 28% stake in the a wide array but was forced to his father died, estate, consumer company, dropped of industries, move his business which he then products, its opposition including online after the expanded into industrial for a merger real estate, SARS outbreak technology and engineering, and with Showa transportation of 2003, which software. Today, retail. Under his Shell Sekiyu, and financial kept staff and Wipro has an leadership, Godrej allowing the services. Forbes clients at home. innovation centre has modernised two oil firms to Family has He has since built in Silicon Valley, the management combine. The feud previously his company into which is focused structure and over differences honoured Li an e-commerce on developing new improved in corporate with the first behemoth, posting technologies and process, and now culture was ever Malcolm revenues of $67.19 collaborating with heads the group settled under the S Lifetime billion in 2018. start-ups. Premji’s alongside his condition Showa Achievement His focus has been son, Rishad, brother, managing Shell upheld award. He now on innovating his heads strategy director of the principles sits as senior delivery methods, and sits on the Godrej Industries, espoused by adviser for his developing several board, and also Nadir, and his founder Sazo $21.5 billion models of drones chairs industry cousin, Godrej & Idemitsu, along revenue (2016) to carry packages lobby group Boyce managing with two board family business to rural villages. NASSCOM. director, Jamshyd. seats reserved for after retiring as He also acts family members chairman. His son as president of at the merged Victor now heads several Indian company. the conglomerate, trade and industry which operates bodies and in more than 50 associations. nations. 48 CAMPDENFB.COM ISSUE 75 | 2019