Most people do not speak to Gen 2 or Gen 3 with enough respect.

[02:41]

"And finding an interest that they have that is fundable, that's investable, that's something that you can use to engage them. I think also just respect. They have knowledge and opinions about things that we don't understand."

[03:37]

"Most people do not speak to Gen 2 or Gen 3, depending on where your starting point, with enough respect. And you know, their belief systems are very different than G1's. And that does not mean though that they do not have value."

[06:39]

"We show them portfolios. We ask them, 'What do you think about this? What's your favorite thing? What do you follow the most?' If you look at it, kids stuff are on Tik Tok, on Instagram. They already know what's going to make money. You just need to listen to them."

Full transcript

In this episode recorded live at our Beverly Hills Investor Club Summit, we explore how family offices communicate across generations, teaching values, building trust, and preparing the next generation to lead with purpose. Let's get into it. You know, Steve, I I have looking at your background and I could be wrong. The Knights of Goodness sounds like such an interesting group.

And do you do you mind talking a little bit just about it from the background of where it started and then how that might relate from generation and then we can kind of other people can chime in too if if if that's makes sense. Sure. Well, the Knights of Goodness is totally separate organization. It is a charity.

It's a public charity and it was developed specifically to grant partial scholarships to children who are almost but that were not water safe. And of course that what it became does address the question of generation. Because essentially as we went forward with it, we saw that for example, we were dealing with very little kids with handicaps all over the country and obviously very very gratifying and of course dealing with the parents as well. So, that is you could say is different than a family office, but it certainly has an aspect of dealing with the different generations in families and doing something productive that is really going to create a a positive outcome.

Sorry. You know, as a second gen Oh, sorry, go ahead. No, no, go. Oh, certainly. Yeah, so my mother involved me very early age taking me to meetings, taking me to the bank, taking me to attorneys' offices. So, I was very used to that environment.

Used to play banker with my dolls. I don't know if that's because I had a natural affinity for those things or if it's because of her exposure to that. I also sold shares in my dogs at a very early age. Ah, that's great. But uh I really credit this to my mother who was a widow and was not very well prepared to be a significant inheritor of wealth when my father passed when I was eight.

And as a mother myself, I have two sons. They're not here with me, but I often take them to uh conferences like this. And they're very actively involved in investing with me. Uh they run my crypto and blockchain portfolio for one thing. Uh and finding an interest that they have that is is fundable, that's investable, that's something that you can use to engage them.

I think also just respect. Uh they have they have knowledge and opinions about things that we don't understand. Each generation has their their benefits and their strengths, and gathering that is important. Philanthropy sometimes is another approach uh or family bank type of approach where you say we have a certain amount of capital. You know, pitch the deal and and maybe you'll get some of it.

So, different engagement strategies, but I've been I've been happy with what my mother did and I've been trying to model her with my sons. That's great. Well, thank you for stealing all of the words that I had come up with. Why do you ask that question? But I would tell you that I think respect is is probably one of the most important ones.

Most people do not speak to Gen 2 or Gen 3, depending on where your starting point, with with enough respect. And you know, their belief systems are very different than G1's. And that does not mean though that they do not have value and I don't think enough professionals dig deep enough to find what value that generation can bring. It may not be that they're capable of running the company.

So succession is not obviously the answer there but you know bringing enough value to the family is something that you know most people have the ability to do and so you have to treat them with respect, ask questions and talk to them like they're a human being and not like you're the professional and they're you know just a a peon of the of the family. You know I'm I'm looking over here this gentleman's got his daughter sitting next to him. I mean succession is starting early. Learning how to communicate with people, learning how to people look people in the eye.

I know Brian McMahon who I've known for many many years was talking about this morning. His son doesn't communicate anymore because everything's in text. At the end of the day you have to be able to look somebody in the eye whether you're on a zoom or in person, shake a hand and be able to have an intelligent conversation. And so treat these people with respect.

I mean you know they are the inheritors of this wealth and they need to be part of the process. I think that's actually Richard's uh top equity analyst if I'm correct uh his daughter there. Anyway uh sorry would you Sure. Just like Alexandra, I'm we actually do the same thing. We bring in the kids. Our my son comes in, of needs the daughters come in to our conferences.

We have them sit down with us during meetings. They get to see first hand what it is to actually be a family office. We teach the fundamentals, eye contact, having a smile on your face. Make sure when you're talking to someone you're looking at them when you're talking to them, not on the ground, not at your phone, no text, no nothing.

That's not even allowed when they're with us. The only time they get to have their phones is if we're doing something and we're not paying attention to them at that point. Otherwise, they wear our logos, they walk around, they say hi to everyone at any conference that we do. Can Can you uh describe how like that would happen over the course of a year with your your different family offices?

Well, when we talk to the different families, it really really depends on what one their mandate is and what their family graphics is also. Every culture is different. Everyone wants to be treated differently. We're Indian. We We make sure our kids are there. They have no choice.

They have to do whatever we say. And I think giving them that foundation to have that respect and have that discipline is something what makes the kids want to say, "You know what? I want to do this. I want to go out and I want to see what's out there. What can I look at?" We We show them portfolios.

We ask them, "What do you think about this? What's your favorite thing? What What do you follow the most?" If you look at it, kids stuff are on Tik Tok, on Instagram. They already know what's going to make money. You just need to listen to them.

Uh yeah, that's correct. How old are yours? Mine are 25 and 21 and they're not listening to me anymore. Mine's is about to turn 20 in October this year. Of Need's daughter is 15 and 13. She's about to be 14.

They better listen cuz if they don't listen to her, they have to listen to me. So, we tag team them. That's great. Thanks for joining us for this conversation. In our next episode, we'll go deeper into the strategies and structures that protect and multiply family wealth. Stay tuned.