Family business succession is not just about transferring assets and ownership, it’s about values and vision.
Every successful family business starts with a founder who pursued a dream, overcame challenges, got smarter, maybe a little lucky, and created wealth. But what happens when the founder is no longer around? How can the next generation build true wealth beyond money?

Jeff Noble, a family business expert with BDO, shares three stories illustrating three common pitfalls in family business success: lack of self-awareness, inadequate support for the next generation’s decisions, and getting stuck in the founder’s legacy.

Story #1: The Janitor's Dream

Irwin was a janitor who took courses after his work hours and became a licensed electrician. In a few short years, he started an electrical contracting company. His children, twin daughters and a son, did not have to work hard and struggle like their father. They grew up in a comfortable and affluent environment and never developed their own identity and passion. When it was their turn to take over, they felt pressured to follow in their father's footsteps, but they lacked the same vision or skills. The sisters were married with children of their own, and their brother was an avowed bachelor. Instead of pursuing their own lives, they unsuccessfully tried to replicate their father's success. Irwin had no idea that by gifting them the business, he would crush his family.

Jeff says that this is a common scenario in many family businesses. The founder’s dream often traps the next generation in the same business. To break free, they need to discover their own purpose and discuss it with their family, finding a meaningful role in the business or pursuing their own path with support.

Story #2: The Successor's Challenge

Ian, a second-generation business owner, told his daughter Susan on her first day as CEO that her number-one responsibility was to find a successor. Ian knew the business needed to grow beyond his and Susan’s skills and had a succession plan that was not restricted to family. Susan knew she was not the ultimate owner of the business, but a steward of it. Without her father’s years of mentorship, Susan may not have had the confidence to adapt to the changing market conditions. Seeing that competitors were gaining ground and realizing her own limitations, she decided to sell the business, believing that was the best option for the family’s wealth.

Jeff says that Ian understood behaviour, and he prioritized letting his daughter exercise self-judgement. Ian and Susan understood that money was not the only measure of wealth and valued the quality of their relationships.

Story #3: The Inherited Portfolio

Siblings Gordon and Liz inherited a portfolio from their father and chose to keep it unchanged out of respect and because they thought it was performing “well enough.”

Jeff says the portfolio was no longer Gordon and Liz’s father's legacy. It was one of the tools to steward and grow wealth. If the father were still alive, he would encourage his kids to adapt the portfolio to achieve their own goals and dreams, and those of their children.

Hear Your Next Generation’s Voices

Three stories show us that family business succession is not just about transferring assets and ownership, it’s about values and vision. The older generation can encourage their children to find their own purpose, even outside the family business.

Too often, the voices of the next generation are stifled by legacy, expectations, and fears. Successful wealth transfer requires a shared vision and collaboration with the next generation.

Get in touch: Jacoline Loewen - Burgundy Asset Management Ltd.