Investing for Family Business Success

  • Randel S. Carlock
  • John L. Ward
Part of the A Family Business Publication book series (AFBP)


We have all heard the old maxim about how the first generation makes it, the second generation protects it, and the third generation spends it. Around the world there are similar expressions to communicate this three-generation pattern of business growth, investment maturity, and harvest: shirt sleeves to shirt sleeves, camel to camel, stable to stable, clogs to clogs, rice paddy to rice paddy. In other words, members of the third generation end up where their grandparents started, unless they do something special — like invest. The fact is that very few firms, whether family controlled or widely traded, survive for more than 50 years or three generations.


Cash Flow Investment Decision Family Business Business Strategy Financial Capital 
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  1. 2.
    Ugo Gussalli Beretta quoted in Wilson, R. L. The World of Beretta: An International Legend (New York: Random House, 2000).Google Scholar
  2. 3.
    Adapted from De Visscher, F., Aronoff, C. and Ward J. Financing Transitions: Managing Capital and Liquidity in Family Businesses (Marietta, Ga.: Business Owners Resources, 1995).Google Scholar

Copyright information

© Randel S. Carlock and John L. Ward 2010

Authors and Affiliations

  • Randel S. Carlock
    • 1
  • John L. Ward
    • 2
  1. 1.Wendel International Centre for Family EnterpriseINSEADFrance
  2. 2.Center for Family Enterprises, Kellogg School of ManagementNorthwestern UniversityUSA

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