Entrepreneurs should set limits says global investor
Entrepreneurs should avoid the temptation to let their family businesses move through multiple generations according to a global investment chief.
Ghazi Abu Nahl, founder and chairman of Nest Investments says that avoiding dynasties is key to long-term success.
The self-made insurance magnate, whose Nest Investments has $5 billion AUM across several sectors and 20 countries, has told CampdenFB that professionalism is vital in family businesses.
"Entrepreneurs bring a unique DNA and set the tone of the organisation, but a world-class business needs world-class processes and professionals onboard," Mr Abu Nahl explained.
He says businesses run the risk of stagnating if they rely on the founding family alone. Fresh blood is needed, both for new ideas and to avoid a sense of entitlement in future generations.
Separate family from business
Although his own children currently sit on the board of Nest Investments, steps have been taken to separate the Nest Group from the Abu Nahl family in all management matters.
To this end the business has been split into two: the family office, and the independent Nest Investments. The structure means family members can limit future involvement in the business and pursue other interests.
"It is no secret that most family businesses do not survive past the third generation. We need to do something about that. The cultures that run through family businesses - fostering security, loyalty and long-term thinking - are just what our economies need in today's volatile world," Ghazi Abu Nahl concluded.
