#Nextgen — 08.10.2020

Banking Entrepreneurialism and the Next Generation of Wealth Holders

Agrifrance : étude annuelle foncier rural Grande-Bretagne I BNP Paribas Wealth Management

BNP Paribas Wealth Management in Asia collaborated with Campden Research to develop this report to better understand the key drivers and motivating factors at play with the ultra-high networth #NextGen community in Asia; they are an emerging generation of Entrepreneurs with great clarity of purpose and direction.

Asia has seen a prolific value creation in the past couple of decades and Entrepreneurialism is at the heart of this economic expansion and with majority of wealth creators (mostly first generation Entrepreneurs) now at the cusp of an intergenerational transfer.

The research methodology saw engagement with a very diverse set of ultra-high networth NextGeners who other than being native to Asia can best be considered as global citizens of the world. The average age of the NextGen was 38 years and average family networth at US$640 million.

These are individuals who are highly educated and come with considerable amount of prior work experience; majority of them already successful business owners in their own right with diversified interests in Finance & Technology.
The report focuses on a multitude of points that shapes their thinking around a diverse set of topics. What's noteworthy is the enormous respect they have for their parent's approach to business and financial prudence; actively seeking to be guided by those experiences.

Trailed are some of the key findings of the report; we encourage you to download the abridged version of the report and should you need to have an in-depth view then kindly reach out to us by filling out the CONTACT FORM.

Some key take-aways of the Asian NextGen research report:

1.       Technical and operation skills, a potent combination

  • Strong entrepreneurial drive, decisions are made with direct application in mind. 
  • 48% of the NextGens surveyed are educated beyond Bachelor’s level, including, at least, one-third in finance-related subjects.  48% have also obtained work experience in finance, with no ambition to stay longer than 3-4 years.   

2.       Next Gens are often involved in both the family business and wealth management

  • Value learning about running businesses from their parents.
  • 45% of the respondents are involved in both their family business and investing their family wealth.

3.       Evolution, not revolution

  • For the NextGen, different generations do not have ‘more’ or ‘less’ knowledge of financial markets
  • Palpable admiration amongst the NextGens for their parents’ business accomplishments.

4.       Digital does not fully substitute for human interaction in banking

  • NextGens are looking forward to the greater convenience that will come with further digitisation in banking.
  • 72% still want human interaction, through which the bank comes to understand the Next Gens’ businesses.

5.       Next Gens are looking for provision of the full range of banking services

  • 35% of NextGens are primarily looking for banks to offer a strategic review of acquisition targets and M&A advisory (17%). 
  • 81% are interested in banks anticipating the need for relevant (risk) forecasts and providing these. 87% want to be treated like institutional clients.

6.   Investment focus is shifting from public to private markets. NextGens see a role for banks to play

  • There is palpable interest amongst the NextGens in private equity and venture capital
  • The majority see a role for banks to play in generating deal flow (82%).

Observations on COVID-19

  • The Pandemic has pushed back or scaled down expansion plans for many traditional family businesses. 
  • Many NextGens have accelerated their engagement in their family businesses and investments because of the Pandemic.
  • The Pandemic also leads to higher psychological acceptance for sustainable and impact investments.
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