How can you grow your money?

How can you make money?

I suggest that you steal a page from the wealthy.

Business e-Volution, by Jacoline Loewen

The Spectrem Group found business owners account for 6% of seven-figure households — triple that of doctors and lawyers.

Don’t expect to get rich quick; the payoff comes when you sell. There is a great deal of that so-called sweat equity that is not seen or experienced by the average tax payer in Canada.

The median price for a web-design firm last year was $687,500, according to BizBuySell. I write about how to use the Internet to grow your business in my book, Business e-volution.

Construction firms tend to fetch $2.1 million. The bricks and mortor businesses still deliver a good return Not shabby amounts to add to your investment portfolio.

Two demographic trends to keep markets rising

Next week, I am running a breakfast session with our economics strategist and the topic is "Is it Getting Late?"

Jacoline Loewen

This long run is worrying many investors. As we all know, change is constant so what could keep the markets trending upwards?

Here are two demographic developments that I believe are likely to move the markets for decades:

1. Canada’s echo boom

As the ratio of a country’s middle-aged (35- to 49-year-olds) to young (20 to 34) rises, so do stocks, says Brookfield research.
Why? As people age, they start to save more for retirement, which is good for the markets. The Canadian and U.S. M/Y ratio surged in the ’80s, sank in the 2000s, but is expected to turn around next year, thanks to the aging of the millennials.

2. China’s baby boom

Beijing is easing its one-child policy, starting off by allowing parents who are only children themselves to have a second child.
“Think about what that means for demand for infant formula, food, education, and housing,” says David Winters, manager of the Wintergreen Fund.

What do you think? Continue the conversation on Twitter: jacolineloewen

The Wealthy Open Up About Managing Family Expectations

In Wealth Management, I have observed that families with $20M and over are wanting more than portfolio management. They are also wanting guidance in helping the family manage their fortune but alos their family cohesion. That has to come as the result of candid conversations that are, quite frankly, easier to avoid.


Jacoline Loewen

Those unspoken conversations do come back to haunt many and are really are better to have with a skilled facilitator aware of the many roadblocks and bear traps along the way. The following is an example of what can be achieved by tackling the task of the money conversations with family. Read full article here.

In one case, she helped a family patriarch who wanted to open up, by bringing the whole family together for a series of family communications workshops. “This was a dad, he wanted his children to know everything,” she says, but the family members weren’t on the same page. The business founder, his wife, their five kids, and his ex-wife, all came together. Two of the three kids work for the family business. The ex gets alimony funded from the business. Some of them talked “business”--while others felt like they were in the dark. “They were at odds; everybody was trying to find their place,” says Schnaubelt.

First, they identified communications styles and learned how to talk so the others would hear them. Those in the family manufacturing business practiced giving the other family members permission to talk, and the others practiced not letting themselves be pushed over. One outcome: they decided to set up a donor-advised fund at Fidelity Charitable, from which they could make large charitable donations in the family’s name, while each family member could suggest smaller grants from subaccounts. In another workshop, families sort through “Picture Your Legacy” cards to select values and aspirations, and then design a family crest. “It’s a great exercise to bring families together and talk about what’s important,” Markwalter says. Taking a page out of his firm’s playbook, he and his wife Juanita, gathered their five sons—two at home and the others scattered across the country—to give it a try. “I thought they’d think it was corny,” Markwalter says. “What I found was that they were incredibly opinionated in a good way.”

The Markwalters made up a family motto: “Faith, Family, Friends.” and added an actionable tagline: “Do the right thing.” They talked about ambition, and finding work that’s engaging—a work ethic they traced back to ancestors who worked as stone cutters on the Cologne cathedral (hence the stone cutter symbol on the crest). The biggest epiphany, Markwalter found, that he shares with other families hesitant about engaging in these kinds of talks, is that “every single family member has something to offer.”

Fintechs at the Future of Finance finals in New York

Jacoline Loewen with the team

IT was a warm week to be in New York with the team to pick the finallist for the Future of Finance Challenge. It has been a journey for all the Canadian companies so it was exciting to finally get to New York and meet the mentors and other finalists.

This is my big AHA: The UBS mentors learnt as much from their interaction with the Fintechs as the entrpreneurs learnt from their time speaking with the UBS experts.

What a great experience to go on the heroic journey with the Canadian fintech finalists, starting in Toronto and then travelling to the UBS HQ in the USA.
There were 11 finalists and 5 were Canadian which was amazing.

Rise of the Millenials - Jacoline Loewen, Speaker at Queens Business Entrepreneurs Association

Jacoline Loewen

Billionaires motivated not only by wealth creation

Working at UBS which provides private wealth management to high net worth people and then also the ultra high net worth, I get asked a great deal about the wealthy. Are they nice? Are they mean? Do they have good family relationships? How do they treat their spouse? How do they spend their money? Did they inherit their money? How did they make it?

Jacoline Loewen at The Business Transitions Forum

When I read this article on the wealthy from John Mathews, head of UBS private wealth, it covered many of the insights that are well worth noting. I thought I would share an excerpt of it.

"Whenever we meet our clients we are struck by how normal they are. Yes they are usually intensely focused, bright and passionate, particularly when it comes to their business. But they are also often quiet, thoughtful and preoccupied as much by the responsibilities of great wealth as by its benefits."

"That sense of the 'burden of wealth' is having some interesting effects. The new generation of billionaires in particular is motivated not only by wealth creation but a broader sense of purpose. This means even more commitment to improving living standards, job creation, and providing broader access to cultural capital. As governments around the world cut back on spending, there is a growing feeling that the private sector must play a bigger role. "

  Below is a brief list of the different activities and you can read the full report here.

1. Arts and culture

Billionaires are creating alternative legacies through their cultural pursuits. Private museums are growing in number and public museums are receiving more funding, increasing the accessibility of art to the public. Maja Oeri, a Swiss pharmaceuticals heiress, illustrated the trend when she donated a large proportion of the funds for the 2016 extension of the Kunstmuseum Basel, the city's municipal art collection. Similar initiatives have proven to be equally successful: US museums like the MoMA in New York and SFMOMA thrive on support from billionaires.

2. Sports

The ultrawealthy are also helping sports clubs to become more sustainable, helping them to deliver associated benefits to the communities of which they are a part. For example, Jack Ma's Alibaba has invested in Evergrande Taobao FC, recruiting international players and coaches, building one of the world's biggest football schools, dominating the league and becoming the first Chinese winners of the Asian Champions League in 2013.

3. Philanthropy

Networks and communities are playing an increasingly important part in enabling this sort of purpose-driven activity. A prominent example is The Giving Pledge. At the end of May 2017, 160 signatories, including some of the world's wealthiest individuals and families, had committed more than half their wealth to philanthropy.

4. Impact investing

Impact investing is also growing fast. The Rise Fund, for example, aims to balance competitive financial returns with positive societal outcomes. Its Founders Board includes billionaire entrepreneurs, rock stars, royalty.

5. Family

Looking ahead, the global impact of billionaire wealth is set to grow even further, with an estimated USD2.4 trillion of billionaire wealth expected to be transferred in the next two decades.

For Every Business Owner - The Business Transition Forum in Calgary

Last year, the Calgary Business Transition Forum event was packed with speakers sharing great stories. I heard fresh content from seasoned professionals too and got to ask many questions.

The networking was outstanding.
 
Register at: www.businesstransitionsforum.com/Calgary
 

The Business Transitions Forum, Calgary edition, happens at the Westin in Calgary on November 8th. I am looking forward to this year. Dave Mason Adam Mallon David Tyldesley Mark Stephenson Lisa Shepherd

Jacoline Loewen at the Business Transition Forum, Calgary

Preparing the Next Generation

It is exciting to share the limited seat offerings in our November 20 - 24, 2017  "Preparing the Next Generation" program in Toronto, ON. The Institute of Family Enterprise Stewards has recently launched and represents a collaboration of thought leaders, families and academic Institutions across CDA. The Institute and the initiatives it supports are without borders and we are actively exploring its expansion beyond CDA in 2018.

One of the most dynamic speakers and consultant on family business- David Simpson - will be co-facilitating the program with Susan Fulford, and as a duo, they offer expertise in innovation & entrepreneurship.

 Content:
The program covers business and financial literacy, communications, trust, values, purpose and clarity of Role & Accountability in families of business & wealth. We also include a focus on conflict & dispute resolution, risk management, negotiations as a life skill and Global Best Practices for building multi generational legacies. Case studies are used liberally. The family  guest speakers we invite in - like Mitzi Perdue, are simply the icing on the cake, and are a valued highlight.

There will be an evening reception.
 
Please call with questions,
Thank you,

Susan Fulford, M.B.A. LL.B. FEA
Dynamic Legacy Inc.
P: (416) 518 8080 | 

www.dynamiclegacy.com

 

Calgary deals to be done at the Business Transition Forum

If you are seeking to speed up your opportunity to network with those interested in the sale of businesses, check out The Business Transition Forum. The next session is in Calgary on November 8th and then Vancouver on the following week.

Top Tool to negotiate the fees for the sale of your business with confidence

For all you business owners who are thinking about selling part or all of their business, you need to download this new report by Firmex and Divestopedia.
I highly recommend reading it to get a true assessment of fees for your sale of business. 
The report also highlights the latest views from the corporate finance experts who will sell your business far better than you can do. Yes, I know you are the smartest person in the room, but you will get more money for your business when the sale is negotiated by the people who have done negotiations for decades.

Also, if you scroll down, you will see a link to sign up for a webinar with John Carvalho, the head of Divstopedia, and with Adam Mallon, BDO, who I enjoy hearing because he tells the stories from the family business kitchen table with deep empathy for the family, but also the sternness to make the right decisions.

For business owners, this report offers an invaluable tool in negotiating fees and terms for investment banking engagements. Of course, in addition to fees, due diligence must be performed on the quality and experience of the M&A advisor. The level of the success fee doesn’t matter much if an M&A transaction is not successfully completed or business owners don’t feel like they got the best outcome.

Get the Full Report

To download your copy of the 2017 M&A Fee Guide, click here.

Attend the Webinar

Join us on November 2nd, 2017 at 1 pm EST for a webinar on the key findings in the M&A Fee Guide 2017. John Carvalho of Divestopedia will moderate a discussion with Adam Mallon and Ryan Farkas of BDO Canada, Shane Stevenson, Dentons, and Jeff Deacon, IAM Group.  To sign up for the webinar, visit: https://www.divestopedia.com/reg/ma-fee-guide-2017/8356.

The whole fintech discussion has changed

Jacoline Loewen

It was terrific to hear our COO, Axel Lehmann, chat about Fintech and banking during his visit to Toronto for SIBOS. Here is a great interview with Business Insider which covers a few of the topics Axel covered with us this week.

Business Insider chatted with Axel Lehmann, chief operating officer of Swiss bank UBS, to ask how the organisation is coming to terms with fast-changing world of fintech.

Ben Moshinsky: Where are the main threats and opportunities to UBS from the fintech boom?

Axel Lehmann: True change is really coming from outside the industry. That is the key challenge we face as of today. The whole fintech discussion has changed, we have moved on from discussing whether a revolution is taking place, and how the banks will become redundant, to a place where most banks are looking at collaborative efforts with other firms. This is why most of what we do in terms of technological development we do in partnership with fintech companies.

I don’t want to get blindsided. It’s less the technology, as such, providing a transformative element in the banking industry. It’s really alternative business models that have the potential to shake up everything and eat into our cake.

It is also full of opportunities. We, the banks, are operating from a position of strength from a customer perspective especially in terms of the amount of customer interaction, the know-how we can provide, and the services we can offer. You can’t create any of this overnight.

And secondly, we have a legacy infrastructure which can be regarded as a liability, but it’s also an asset. When the Trump election got through, for example, volatility was high. We have an infrastructure that can scale up in line with volatility, and that’s something you need to have.

So, in this regard, I’m personally optimistic. It’s easier, when you look to consumer industries, for example, Uber or WhatsApp, to disrupt a lightly regulated sector. But when you look at where we as banks are, you get into the highly regulated space immediately, when you talk about balance sheet and liquidity, and this makes this industry less easy to disrupt.

But no doubt, we still do have to be mindful that we’re not losing out on some of that less regulated space, particularly at the point of customer interaction.

BM: What's the most exciting technology on your radar?

AL: I truly believe that whole question of robotics and artificial intelligence over a time horizon of four to eight years will fundamentally change the banking business. As banks, we understand that our business is all about data. These technologies have the potential to really fundamentally change the way we operate in terms of getting smarter with the customer, understanding what kind of products we should offer and so on. That is definitely exciting.

Succesful entrepreneurs who combine their business with their travel

I dislike Chai tea usually. It has a taste that does not fit my taste expectations which lean towards a sharper  Kenyan black tea. Until I was made the perfect cup of Chai tea by Eamon Fitzgerald and Rebecca Moroney, founder of Chaiwala Chai, and they changed my tea tastes

Rebecca Moroney and Eamon Fitzgerald

for ever. They use the correct traditional method and the taste was heavenly. It truly is a cup of contemplation. Now I find myself heading to Balzac for one of these Chai teas which have the comfort of a hot chocolate, but the calories of a latte. 

I caught up with the couple in the Toronto Star. Becca and Eamon have bought a van and use it to travel across Canada as they run their business, as they are also seasoned travellers who have been in Africa, Europe and South America. They would make a great pair for a reality TV show. Here is an excerpt from the Toronto Star article.

The Toronto couple has been living in a converted cargo van since spring — travelling thousands of kilometres across Canada. Their view changes often, from the snow-topped mountains of Squamish, B.C., to the beaches of Prince Edward County.
“It’s like we have a $5 million cottage on the water,” says Moroney, of spending summer days parked along a County side street. “The best part of van life is you have your home with you everywhere you go.”
Moroney, 27, and Fitzgerald, 25 are among thousands who have taken up “van life.” With more than 2.1 million posts under the hashtag #vanlife on the photo-sharing app Instagram, it’s one of the most coveted lifestyles on social media.

Read the full article.

What's the most exciting technology on your radar?

It has been a week of technology here in Toronto with SIBOS, CIX and the UBS Future of Finance Awards Dinner.

One of the questions I got to ask our finalists of the UBS Future of Finance was their views on cryptocurrencies and banking fintechs impact on banks. Our UBS COO, Axel Lehmann, spoke about this topic too. Axel Lehmann said,

I truly believe that whole question of robotics and artificial intelligence over a time horizon of four to eight years will fundamentally change the banking business. As banks, we understand that our business is all about data. These technologies have the potential to really fundamentally change the way we operate in terms of getting smarter with the customer, understanding what kind of products we should offer and so on. That is definitely exciting.

I post on Twitter the question: What is the most exciting technology on your radar. One of the best answers came from Roman Monaenkov @roma_odin  who said his answer was Etherium - the cryptocurrency. Do I sense a little bias as Vitalik is also Russian and here in Toronto.

Here is the fantastic video sent by Roman which features Vitalik Buterin, one of the founders of Etherium.  Vitalik is speaking as the keynote speaker at MaRS explaining cryptocurrency in a thorough and understandable presentation.

Vitalak Buterin, speaking about Etherium and cryptocurrency at MaRS, Toronto.

Follow on Twitter @jacolineloewen

True change in Banking is really coming from outside the industry - Fintechs

Visiting Toronto for SIBOS, Axel Lehmann, chief operating officer of UBS, carved out time to speak at The National Club. During his talk, Mr. Lehmann delved into financial technology – or 'fintech' – and how UBS is engaging with this exciting technology.

Here is an excerpt from a recent interview between Business Insider and Mr. Lehmann which gives a summary of the topics Axel covered here in Toronto. Read full interview here. 

While no lender wants to become the next Nokia or Kodak, crushed by an innovation they failed to properly understand, it's not always clear how an organization with 100,000 employees should deal with the threats and opportunities posed by fintech.

Ben Moshinsky: Where are the main threats and opportunities to UBS from the fintech boom?

Axel Lehmann: True change is really coming from outside the industry. That is the key challenge we face as of today. The whole fintech discussion has changed, we have moved on from discussing whether a revolution is taking place, and how the banks will become redundant, to a place where most banks are looking at collaborative efforts with other firms. This is why most of what we do in terms of technological development we do in partnership with fintech companies.

It’s less the technology, as such, providing a transformative element in the banking industry. It’s really alternative business models that have the potential to shake up everything and eat into our cake.

We have a legacy infrastructure which can be regarded as a liability, but it’s also an asset

It is also full of opportunities. We, the banks, are operating from a position of strength from a customer perspective especially in terms of the amount of customer interaction, the know-how we can provide, and the services we can offer. You can’t create any of this overnight.

And secondly, we have a legacy infrastructure which can be regarded as a liability, but it’s also an asset. When the Trump election got through, for example, volatility was high. We have an infrastructure that can scale up in line with volatility, and that’s something you need to have.

So, in this regard, I’m personally optimistic. It’s easier, when you look to consumer industries, for example, Uber or WhatsApp, to disrupt a lightly regulated sector. But when you look at where we as banks are, you get into the highly regulated space immediately, when you talk about balance sheet and liquidity, and this makes this industry less easy to disrupt.

But no doubt, we still do have to be mindful that we’re not losing out on some of that less regulated space, particularly at the point of customer interaction.

BM: What's the most exciting technology on your radar?

AL: I truly believe that whole question of robotics and artificial intelligence over a time horizon of four to eight years will fundamentally change the banking business. As banks, we understand that our business is all about data. These technologies have the potential to really fundamentally change the way we operate in terms of getting smarter with the customer, understanding what kind of products we should offer and so on. That is definitely exciting.

Business Insider then asked about how UBS is interacting with fintech. Mr. Lehmann explains the Future of Finance Challenge which was run around the globe. Out of the 11 regional finalists in the Americas, Canada has 5 companies going to New York. It shows that Canada has a dynamic fintech industry.

Here is the article again:

BM: How does a bank, like UBS with tens of thousands of employees, interact with a fintech startup of just a few people? What kind of cultural changes need to happen

AL: Dealing with fintechs is a cultural shift that needs to take place and you want to have the local people to innovate. At UBS we have a systematic process on how we expose ourselves to fintech companies. For example, we have a series of initiatives that we’re driving, such as our Future of Finance Challenge. This competition, which is happening at the moment, provides a forum for start-ups and growing companies to come and present their ideas to compete for support from UBS to

Axel and Sophie Perceval, Wondereur, award for Future of Finance

accelerate their ideas. That’s the type of work we’re doing. We really want to take advantage of some of those fast-moving and smaller boats with great ideas and great software that we can scale up and use in our organisation.

BM: Is competition for those boats fierce? How do you make sure you invest enough time and money?

AL: UBS has a CHF2.1 billion net saving target, but nevertheless our IT spend is at a record level of more than 10% of revenues. We do not sacrifice mid-term and longer term development to make numbers for a quarter. Secondly, if you look to our overall positioning it is quite unique, and that gives me confidence. We’re the global leader in wealth management, which is one of the key areas to invest in digital. Every dollar we invest there, hopefully wisely, is helping us strengthen that franchise.

Jacoline Loewen, Future of Finance Awards Dinner

The Five Finalists for the Future of Finance from Canada are:

Global-Regulations
MindBridge
Overbond
Veriday
Wondereur

How much do you need to save for retirement?

How to leave a legacy - Cathedral Approach

From the magazine Unlimited, they have a fascinating story on how to leave a great legacy and the lessons come from looking at how cathedrals were built in the middle ages. I also wrote an article for the Globe and Mail on Cathedral building and how similar it is to building a business in that each generation adds a wing or a tower and then passes it along to the next generation to continue the vision. Some cathedrals took hundreds of years to complete which is hard to imagine. I am complaining about Eglinton Avenue and the time to build the subway so it does make me realize that time is relative.

I will post my article below but here is the article from Unlimited and the link to the full article.

We are entering an era of Cathedral Wealth, where the most meaningful thing that you can hand down to the next generation is no longer a watch or family estate, but a grand challenge, a life’s work or a multi-generational task.

In the Middle Ages, building a cathedral to honour God was considered one of the greatest works that a community could undertake. Everyone from heads of state and religious leaders to architects, craftsmen and labourers joined together to create these monumental structures.

Building a cathedral was an endeavour of such scale that they would often take decades or even centuries to finish. The people that laid the foundations would do so in the almost certain knowledge that they would never live to see the finished product.

Today, at a time when the future of mankind has never looked more complex and uncertain, we are increasingly realising that our biggest questions may require multi-generational answers.

‘Modernity has pulled us into an era of short-termism and individualism,’ says Rachel Armstrong, senior TED fellow and founder of Black Sky Thinking.

‘However, the biggest issues facing humanity, such as climate change, over-population and energy and resource shortages, require us to think in terms of solutions that will span generations.’

Like the craftsmen that laid the first stones at St Paul’s, St Basil’s and Notre Dame, today’s leading scientists, business leaders and creative innovators are beginning to think in terms of a new kind of wealth – the handing down of purposeful and life-affirming projects that only their grandchildren, or even great-grandchildren, will see bear fruit.

‘In the past, your legacy would have been much more about handing down tangible assets, such as cash and bricks and mortar,’ says Ken Forster, angel investor and managing director of Internet of Things solutions company Momenta Partners.

‘Today, it’s about a more organic, more sustainable wealth transfer – leaving your life’s work, something you created, unfinished, and trusting those who follow you to see it through to completion.’

In this report, we examine how Cathedral Wealth and long-termism are beginning to emerge in society in three pivotal ways.

: Creative Cathedrals – the multi-generational projects that are shaping the future of science, technology and design

: Commercial Cathedrals – how the world of business is moving its sights from the next quarter to the next decade and even the next century

: Cultural Cathedrals – why our fascination with long-term cathedral wealth is driving the emergence of new forms of art and culture that will be enjoyed by future generations

read the article here