The Multigenerational Family Business, with Dr. Dennis Jaffe

For an intended multigenerational family business to last past the first generation, the family must become a successful team. https://www.youtube.com/watch?v=CuQR8NBc2JY Professor, organizational consultant, family therapist, and family business consultant Dr. Dennis Jaffe joins us today. He has helped families overcome challenges that impede successfully transferring businesses, wealth, value, commitments, and legacies across generations. So, if you want to create a multigenerational family enterprise… tune in now! Table of contentsWhy Should Families Think Multi-Generationally?What Can History Teach Us About the Multigenerational Family Business?When Do You Bring Kids Into the Family Business?The Challenge of First-Generation WealthWhat is the Best Way to Create a Multigenerational Family Business?About Dr. Dennis JaffeBook A Strategy Call Why Should Families Think Multi-Generationally? [3:40] “There’s no ‘should’ about it. This is what families are concerned about—they’ve created wealth, been successful, they’ve providing for their family, they’re creating more wealth than they can use on a day-to-day basis, and they have young people growing up. And they begin to say, ‘Well, what’s going to be my legacy?’ And they begin to ask the question—not how do I get more wealth—-but what is the purpose of our wealth? What do we want to do with it?” Dr. Jaffe has noticed that as families build wealth, they think more seriously about what that wealth will do beyond them. And this consideration is critical because it’s how wealth lasts for generations. You can’t simply build up wealth, you also have to create systems, educate your kids and grandkids, and pass on your values so that the generations beyond you will know how to be good stewards of your money.  What Can History Teach Us About the Multigenerational Family Business? Dr. Dennis Jaffe has been in the field of family business and wealth since the early 80s. And over time, this industry has really evolved to include family meetings, family constitutions, and much more beyond just getting advice from a financial advisor. What Dr. Jaffe has done is interview and compile information from wealthy and successful families. A successful family, as Dr. Jaffe defines it, is a family that has kept and maintained its wealth for at least three generations. After all, these are the families who have done a good job of educating the next generation on how to build and keep wealth. Successful families are also families who spend time together and have a sense of connection.  [12:10] “What I found is that these hundred-year families had a great sense of their legacy and history. They could look back for the fifth generation and say, ‘Well, you know, grandpa did this.’ Or, ‘One of the things that grandpa did that really made a difference for us is this…’” This research proves helpful because it doesn’t suggest a singular path to wealth. Instead, it illustrates many paths and options for building and sustaining wealth. And behind it all is a sense of family history—that each generation can learn from the ones before. When Do You Bring Kids Into the Family Business? As important as it is to look to the past for guidance on sustaining wealth, it’s just as important to keep tabs on the future. After all, your children and your children’s children are the future of your legacy. They’re the ones who will carry the torch, so it’s important to prepare them to inherit the family’s wealth and continue that legacy.  [19:11] “So, one of the first things that I learned is that the older generation has to really listen to the next generation because they have a very unclear and unrealistic idea about the future. Because they see it from their own eyes and their own experience. They don't really understand the experience of their kids, the people that their kids marry, and their kid’s kids. And all those people have to have a voice,