Despite the desire of almost all family businesses to pass control over to the next generation, it appears that few of them want to join their family business.
A recent study by St Gallen University in Switzerland found that only 3.5% of all the next generation members they surveyed want to take over their parents’ firm directly after college graduation, although the number goes up to 4.9% five years after graduation.
More than one-third of those surveyed would like to start their own company, suggesting that it’s not a lack of entrepreneurial spirit or motivation preventing the next generation from joining the family business.
The research found that succession intentions vary across countries as well. Survey participants in Mexico, Belgium and Slovenia have the strongest intention of joining the family business five years after studies, with those in the US, Israel and Denmark the least likely to follow in their parents’ footsteps, says St Gallen. In most countries, the succession path is more attractive five years after graduation, which indicates that some next-generation members plan to gain professional experiences at other companies before joining the family business.
The St Gallen University study was based on data collected by the GUESSS project (Global University Entrepreneurial Spirit Students’ Survey). Between October 2013 and April 2014, GUESSS collected data from 34 countries. More than 750 universities were involved, and 109,000 surveys were completed. The study is based on the responses from 34,113 students (31.3%) with a family business background.