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Capital Club

Does Running a Successful Family Business Ensure Your Family’s Financial Legacy? With Richard Ryffel

Ep. 230

Do you know how family businesses can thrive across generations? 


Join us in our episode with Richard Ryffel, professor of finance practice at Washington University in St. Louis. With 35 years of experience in financial services on Wall Street and regional firms and an MBA in finance, Richard has seen it all. He is currently teaching several finance courses as part of the Koch Center for Family Enterprise to help families better understand how to manage their businesses. Richard discusses the importance of diversification in family-owned businesses, how liquidity events should be handled, and the value of having a trusted advisor. He also explores the idea that wealth should be concentrated and diversified to stay wealthy, different generations' attitudes towards risk-taking, and the potential for failure as a learning experience. 


Tune into this riveting episode!


[00:00 - 08:04] 35 Years of Financial Services Experience

  • Rich's brief background and career
  • The Koch Center for Family Enterprise was set up to drive research into the practice of running family businesses
  • There is a proliferation of private companies and more entrepreneurial spirit than ever before


[08:05 - 13:58] Investing for Wealth Preservation

  • St. Louis has a robust history of companies that have survived for multiple generations
  • The risks of not diversifying and how to do so without selling the business


[13:59 - 22:35] Maximizing Value for Your Company 

  • Step back and think about culture and how important it is to maintain it
  • Consider family involvement and whether you wish to continue to be involved in the business
  • Have a group of people around you with different lived experiences for input
  • Consider if there is a distinct competence or moat when expanding into adjacent businesses


[22:36 - 30:52] Exploring Risk Taking and Risk Mitigation for Family Businesses

  • The mindset of the younger generation is different from the baby boomer generation when it comes to family businesses
  • Younger people are more willing to take risks but should be careful when investing in something that might fail
  • Failure can be a learning experience, but educated risks should be taken
  • The Center educates students on modern techniques and governance issues that may not have been considered before


[30:53 - 37:23] Closing Segment



Quotes:


"Careers always look organized in the rear view mirror. They look perfectly ordered. But when you're going through it, not so much." - Richard Ryffel


"You get rich through concentration. You stay rich through diversification." - Richard Ryffel


"Money in and of itself is nothing. Money is a tool to achieve something; your wants and needs." - Richard Ryffel




Connect with Richard!

Email: ryffel@wustl.edu 

Olin Business School: https://olin.wustl.edu 

LinkedIn: https://www.linkedin.com/in/richardryffel 



Connect with me on LinkedIn!


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