The facts of the matter: There are 5.5 million family businesses in the US. (FEUSA, 2011). Family owned businesses contribute 57% of the U.S. GDP (that’s $8.3 trillion), employ 63% of the workforce (FEUSA, 2011), and are responsible for 78% of all new job creation. (Astrachan & Shanker, 2003).
In spite of this potentially surprising presence in our economy, nearly 40% of family businesses in America will be passing the reigns to the next generation over the next 5 years. (BusinessWeek, August 11, 2003)
Approximately $10.4 trillion of net worth will be transferred by the year 2040, with $4.8 trillion in the next 20 years. (Robert Avery, Cornell University, “The Ten Trillion Dollar Question: A Philanthropic Gameplan”)
This not only represents one of the largest inter-generational transfers of wealth in the history of this country, but also means that owners may find it increasingly competitive to find appropriate buyers, owners, and operators without compromising the values or future of their cherished companies.