As a wealth planner, I’ve had the privilege of accompanying families as they navigate the complexities of generational wealth. I learn new things whenever I work together with them, which is a real pleasure and honour, and I believe that excellence can be achieved when we care passionately about what we do in every single day of our lives. One of the things I’ve learned over the years is that money isn’t the most volatile element when running a family business – emotion is. 

One story that has stayed with me for years is the case of a family I got to know during my early years in the legal profession. My colleagues and I handled some of the legal aspects when the family were expanding their business across the region. Although I wasn’t a wealth planner at that time, I followed their business with admiration and, subsequently, regret. 

Years later, in my current role of advising families directly, I’ve reflected on their story and what it tells us about how secrecy, rivalry, and poor communication can destroy successful enterprises. Their mistakes (I’ve changed their names and some of the details in the following to protect their anonymity) provide a blueprint for avoiding similar mistakes. 

Incompatible heirs to a thriving legacy

The family had built their fortune from scratch. What started as a single haulage company in the 1970s had, by the time I got to know them, become a mid-sized supply chain empire serving industrial clients across the region. Their company was respected, profitable, and deeply rooted in family values. The patriarch at the helm, Mr. Vega, was a stern but charismatic figure who was well into his seventies.

From the outside, the family may have appeared to be like a model of multi-generational success, but under the surface it seemed that there was trouble. The patriarch had two sons: let’s call them Héctor, the eldest, and Martín, the younger by five years. Both worked in the business, but their paths and personalities were very different.

Héctor was methodical and cautious. He had an MBA from the U.S. and had returned home with big ideas for modernisation – things like ERP systems, digital logistics, and global expansion. Martín, on the other hand, was more of a ‘street-smart’ dealmaker. He had no formal business education but a knack for securing lucrative contracts and nurturing long-term client relationships.

In private, Mr. Vega often praised Martín’s instincts but complained about his recklessness. With Héctor, he respected the discipline but worried he lacked the charisma to lead. I remember he told my boss: “Each of them is half the leader I want. Together they would be perfect. But they will never work together.” That was the problem, and with the benefit of hindsight, it seems that he was right.

Lack of clarity creates secrets and suspicion

Succession planning is not always just about choosing a leader – more often it’s about creating clarity. Unfortunately, Mr. Vega may have clung to his authority far too long, refusing to name a clear successor. Instead, he told each son different things in private conversations.

To Héctor, he implied the business was his birthright. He spoke of legacy, tradition, and how the eldest must shoulder the burden of leadership. To Martín, he made promises of control in recognition of his commercial prowess. Neither son knew what the other had been told.

The rest of the family – Mrs. Vega, the daughters, and the grandchildren – seemed to be largely in the dark. I suppose they believed that when the time came, Mr. Vega would do the right thing. But, as often happens when planning a legacy, time has a way of running out, and that clarity never came.

Sibling rivalry replaces leadership

Tensions between the brothers simmered for a long time, but the situation exploded when Mr. Vega suffered a minor stroke. Though he recovered, his physical and mental powers were beginning to decline. 

This triggered a power vacuum. Héctor believed it was his time to take charge and he began reshaping the management team, bringing in outside consultants and restructuring departments. Martín saw this as a hostile takeover and began locking down key client relationships, even bypassing company processes to close deals. He started building his own loyal faction within the company, mostly among the sales and operations staff.

Their fights became public, including boardroom arguments, contradictory decisions, and even shouting matches in front of employees. Clients and vendors noticed – and so did a major competitor.

Vulnerability to an unsolicited offer

In the middle of this discord, an unsolicited acquisition offer landed on their table. A larger multinational in the same sector saw an opportunity to absorb the Vega family’s company and expand into a profitable market. The offer was generous – enough to make a big difference to the family for generations to come – but it was dependent on a unanimous board decision being made within a month.

Unfortunately, the situation that followed was rather chaotic. Héctor seemed to see the offer as an insult, claiming that the company was not really in distress but merely going through a transition. Martín, on the other hand, saw it as a golden parachute. Based on reports from the other family members, his attitude seemed to be: ‘Why fight over control when we can all walk away rich?’

From what I could gather, the rest of the family was split. Some seemed to be tired of the tension and were worried about Mr. Vega’s health. They leaned towards Martín’s view. Others felt Héctor deserved a chance to steer the ship back on course.

From missed opportunity to forced exit

In the absence of clear leadership or a succession plan, no decision could be reached and the deadline passed. The acquirer, apparently sensing the instability, withdrew the offer – only to return six months later with a hostile bid at a much lower valuation.

With public knowledge of the family feud, key employees started leaving, clients pulled back, and internal morale decreased. The board, fragmented and exhausted by the situation, eventually voted to accept the lower bid in order to end the turmoil.

The company was absorbed, and regretfully the family lost control of the business that Mr. Vega had built from scratch. The final sale was worth significantly less than the original offer. But what made this even worse was that the family’s unity, which was once their greatest strength – was shattered. Even though I was only following this story as a legal professional, I was very saddened to see the emotional hardship that the family endured.

Succession planning: what the family got wrong

Now, in my career as a wealth planner, I see the Vega family’s story as one which holds important lessons for all family businesses. Above all, I believe that succession is not something you can improvise. And secrecy, even if it doesn’t come with bad intentions, often creates confusion and resentment.

The Vega family business seemed to have everything going for it – wealth, reputation, and opportunity. They lost it not because of market forces or economic downturns, but because of pride, silence, and rivalry. As a wealth planner, I regard it as an honour to help clients grow and protect their wealth. But more importantly, I see it as my role to help them preserve harmony – because once that’s lost, no amount of wealth is big enough to buy it back.

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