At this time of the year, the new Sunday Times Rich List is published in the UK. I thought it would be interesting to examine what makes people rich. What is the secret to their success?
"If you can count your money, you don't have a billion dollars." John Paul Getty
So how can you make the Rich List?
You need at least £115mn to break into this year's list. However, do not let that stop you trying. This year there are more new entrepreneurs than ever before in the list, including more women.
Its never too late to start
The richest person in the 2018 UK Rich List is Jim Ratcliffe, aged 65, who only started his business Ineos at the ripe old age of 45 and is now worth an estimated £21.05bn, twenty years later. He started in a council house and was sacked from his first job after three days. It is never too late to start.
Do it yourself
In this year's list, 94% have made their own money. So go out and do it yourself. Only 6% (or more accurately only 5.7%) of the names or families on the list inherited the money. Only 6%!!!! Should this number be higher? What happened to the succession planning and the family constitution to help grow the family wealth?
"The Rich List increasingly tells the story of how new money surpasses old money."
Clogs to Clogs?
Should this be a wake-up call to the families that there are very few high-quality succession plans that go on to enhance the family's wealth? Or is the second, third, or fourth generation too busy watching their family businesses no longer evolving, no longer growing so quickly? Is the family business being disrupted by new start-ups or by new technology or have the customers changed their preferences? Alternatively, has the business been sold or gone bust? I can hear you thinking, "clogs to clogs in three generations".
"No one can possibly achieve any real and lasting success or 'get rich' in business by being a conformist."
I have worked for a long time advising wealthy families, family businesses and family offices about succession. It is imperative that succession of a successful business or family wealth does not lead to the inheritors becoming curators of the business or the wealth. See my article "Don't become a Curator of Your Family Business". An entrepreneur's business that turns into a family business must carry on evolving if it is to grow.
How do you do that?
It is about the quality of the decision-making of the individual and the team. We spend much time analysing and helping teams with their decision-making. My other business Peak Dynamics specialises in organisational culture, team behaviour and decision-making. We help clients who find themselves in very binary environments where most of the decisions are life or death. We must be getting something right, as we have helped three teams break world records in extreme situations. Can we help you?
More come to the UK to get rich
The names on the rich list are more international than it has ever been - Swedish, German, Canadian, Indian, Ukrainian, Dutch, Russian, Italian, Saudi Arabian and Norwegian. Many more families are relocating to the UK or at least some of the family members are. We find ourselves helping more families as they arrive here in the UK. We have a satellite family office service especially for overseas families who need help in the UK.
"London is now a magnet for the world's super-rich"
All you need is a smartphone and laptop
The speed of evolution of technology has made it easier than ever for entrepreneurs to start a new company of their own, particularly at a young age. We all used to have to get out of bed; put on a suit and tie, or smart top and skirt and travel to some building; report into a boss and work our way up a hierarchal system, hoping that we would get a nice bonus if the boss liked us and that we would keep your 'final salary pension scheme' until we retired at 60 to your large house in the suburbs. That's all changed. The hierarchical system is changing in many places. New online start-ups often do not need much capital if any at all. All you need now is a smartphone and a laptop. Even better you do not have to get out of bed!
You also do not need any qualifications, but you do need...
- A desire to solve the next problem or spot the next opportunity.
- A desire break out from the poverty of your youth and never go back there.
- Take a risk - not to be fearful of giving it a go.
- Be optimistic and a good motivator.
- Trust your gut instinct.
- Be energetic and competitive - you were probably good at sports when you were younger.
- A good salesperson or persuasive character.
- Be disciplined.
- Self Determination - A desire to have the freedom and autonomy to start and run your own business but take the risk that you will earn less than take a job and possibly make more as an employee.
- Be Impossible to categorise and institutionalise.
"The #1 guideline to success is you must be in business for yourself. When you work for someone else, you sell your time at wholesale to your employer, who then re-sells it at retail to the customer."
I have get asked to help a lot of the next generation. The opportunity for them is greater than it has ever been. It is going to change the way family businesses evolve and family wealth is created. I have been running entrepreneurship programmes for many years now and seen the amazing ideas that come from the young. Families and businesses need to encourage and embrace this era of entrepreneurship and innovation.
If you are interested in getting help with any of the following, please contact us:
Satellite Family Office
Coaching and Mentoring
Leadership and Entrepreneurship Development
Culture, Team behaviour and Decision-Making
Source: The Sunday Times Rich List 2018