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UBS and PWC studied 2,158 billionaires. Here’s what they found.

The world is getting richer and China has a lot to do with it.

UBS and Pwc have released their fifth report on billionaires and the long and short of it may not be altogether surprising: The world is getting richer and China has a lot to do with it. But, with research based on 2,158 billionaires from 43 countries, it’s worth taking a look at the report’s insights. The full report documents the rise of the new billionaire, shaping history through wealth creation, and managing family wealth in the 21st century, but here are some key highlights.

(US$1 = S$1.37)

 

21ST CENTURY WEALTH

% OF MULTIGENERATIONAL BILLIONAIRES WHO START ENTREPRENEURIAL VENTURES

More families are starting to understand the benefits of giving their heirs business experience early, giving rise to business families instead of family businesses.

(RELATED: There are 183,737 millionaires in Singapore, and 1,000 who are ‘crazy rich’)

 

THE NEW BILLIONAIRE

number of new billionaires that accounted for more than a third of the 38 per cent increase in billionaires’ assets last year, growing from US$1.4 trillion to US$8.9 trillion, this is the greatest annual increase ever.
The time it could take for Apac billionaires net worth to overtake their American peers’. Thanks to China’s rise, the former’s net worth grew by 32 per cent to US$2.7 trillion last year.  

How billionaires are adding to their wealth

Where billionaires are concentrated around Asia

Huge populations like the above have fertile conditions for wealth creation, with India and Indonesia urbanising fast and offering scale for innovative and disruptive service industries. But China will continue to take the lead, because of its strong manufacturing base and R&D expenditure.

(RELATED: China leads the way as world’s billionaires get richer)

 


“I think that my generation wants to achieve a more holistic life and shed some of the hypocrisy of previous generations. We want to have a return but with impact. Our investments should reflect who we are and what we believe.”

A 30-YEAR-OLD SON OF A GERMAN FAMILY THAT SOLD ITS BUSINESS 10 YEARS AGO.


 

THE CHINESE PHENOMENON

rate of rise of billionaires in China

 

DRIVERS OF THE “FOURTH INDUSTRIAL REVOLUTION”

Growers

There are also entrepreneurs who are growing their businesses through scaling them up. With an increase in people moving to the cities to join the middle classes (especially in Asia), consumer markets are also expanding rapidly.

Innovators

These are among 2017’s 199 new self-made billionaires, almost half of whom are leading China’s transformation. Many have made their fortunes through innovation and business model disruption, some of them in areas related to accelerating industrial revolution.

Statistics of China businesses versus American businesses

(RELATED: How the founders of Airbnb went from cash-strapped roommates to billionaires)

 

5 TIPS FOR SUCCESSION PLANNING

01 INVOLVE THE NEXT GENERATION EARLY

This is crucial for a smooth transition and allows both generations to find common ground and align their goals.

02 PREPARE WOMEN TO EXCEL

Women are increasingly creating wealth in their own right, and wives and daughters are similarly stepping up to lead their family businesses.

03 EMBARK ON A FAMILY PROJECT TOGETHER

Whether it’s a philanthropic or entrepreneurial venture, it helps cultivate a spirit of joint decision-making.

04 ENCOURAGE ENTREPRENEURSHIP

Letting potential successors take charge of their own projects, such as a private fund or structure, will help develop business acumen.

05 THINK ABOUT SUSTAINABILITY

Not only is there emerging evidence showing that sustainable businesses achieve steadier profit growth, millennials are also passionate about working for businesses with a strong social purpose.

(RELATED: How to preserve wealth beyond 3 generations, according to wealth management expert Yash Mishra)

Photo by Mahosadha Ong on Unsplash