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March 30, 2012updated 04 Apr 2017 3:42pm

Tech boom changing face of global UHNW wealth

The growing global technology sector is a game changer for family involvement and the way fortunes are founded and managed, according to a report from Forbes Insight and Socit Gnrale Private Banking. The Global Wealth and Family Ties report says individually-run fortunes are growing faster, and while 58% of fortunes in all sectors as a whole are managed by individuals, in the tech sector this rises to 76%.

By Thomas McMahon

The growing global technology sector is a game changer for family involvement and the way fortunes are founded and managed, according to a report from Forbes Insight and Société Générale Private Banking.

The Global Wealth and Family Ties report says individually-run fortunes are growing faster, and while 58% of fortunes in all sectors as a whole are managed by individuals, in the tech sector this rises to 76%.

This trend holds across geographical borders, with only half of India’s technology companies run by family businesses while 73% of all fortunes are family-run.

 

Youthful tech billionaires

Technology billionaires tend to be younger; many are still single, and they make their fortunes largely with friends rather than family.

The report concludes it remains to be seen whether the progressive attitudes to business, management and philanthropy practiced in the sector will spread to other industries.

The conclusions come from an analysis of 1,253 of the world’s largest fortunes in 12 countries.

The individuals studied had a minimum net worth of $1bn with the exception of those from India ($370m), China ($500m) and Singapore ($210m).

 

Family fortunes

The highest percentages of fortunes that are family run are in Hong Kong (75%), India (73%), France (64%) and the Middle East (62%).

The lowest percentages of family run fortunes are in Russia (19%), the UK (25%) and China (33%), with 42% in the US.

In general, mature markets have more inherited wealth and more fortunes run by families, the report says.

In emerging markets, 61% of the fortunes had no family involvement in the businesses, while in the mature markets the figure was 54%.

 

Wealthy women on the rise

In the US, self-made fortunes accounted for 69% of the total in 2011, having risen from 55% in 1997, driven to a large extent by the acceleration of fortunes made from new technologies.

There is a uniquely high number of self-made women among the richest in China, while in Russia the entrepreneurial super-rich are younger than in Western Europe and have friends as business partners rather than family.

In India family-run fortunes still account for 73% of the total, but there are signs that more business groups are starting to separate family and management.

The Middle East has one of the highest ratios of family involvement in business worldwide due to the influence of Arab culture.

 

 

 

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