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Family businesses on the wane; Fewer family businesses are being passed on to successive generations, a new report finds

Family businesses on the wane

Fewer family businesses are being passed on to successive generations, a new report finds

Family businesses will contribute more than £120bn to the UK economy by 2018 Photo: AFP

By Rebecca Burn-Callander, Enterprise Editor

7:00AM BST 20 Jun 2014

Family businesses are no longer being passed down to the third generation, new research has found.

The ‘Second Generation Family SMEs in the UK’ report, compiled by Barclays and Cebr, showed that the number of businesses handed on to the next generation has fallen by 136,000 since 2007.

There are currently 570,000 small businesses under family ownership for one generation or more in the UK. Seven in ten of these have been in the family for two generations, while just 29pc have made it through to the third generation and beyond.

However, there is still appetite for family business in the UK. In its survey of more than 2,000 UK adults, the report found one in three people would start a business with a relative, rising to 40pc of 18-34 year olds.

Siblings proved the most popular business partners with 27pc of the vote, followed by fathers with 9pc, and mothers with 7pc.

However, while 61pc would want to pass on a family business to the younger generation in their family, 23pc of those over 55 feared that the younger generation would not want to inherit it.

Rebecca McNeil, director of business lending and enterprise at Barclays, said: “By 2018 these businesses will contribute over £120bn to the UK economy so it’s important that they are supported.”

 

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About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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