What Does It Mean to Be Wealthy?

Dave Specht is the Director of the Global Family Business Institute at The Drucker School of Management. Dave is the author of, "The Family Business Whisperer." Prior to joining the Drucker School Dave helped lead a Family Dynamics team at one of the largest Private Banks in the United States where he trained over 2,500 advisors. Dave is married and he and his wife have 6 children. His personal mission is to, "Preserve Families and Perpetuate Businesses."

Standout Quotes:

• "The path to helping families is not in having the right answers for them, but it's about having the right questions for them" - [Dave]
• "Clients know if you're genuinely curious about their lives, or you're genuinely trying to get into a transaction with them" - [Dave]
• "What is your ambitious pursuit, what is it that wakes you up in the morning that you want to chase?" - [Dave]
• "Ultimately if we can stay grateful, entitlement can't sneak in… gratitude and entitlements are incompatible roommates" - [Dave]
• "One of the bigger challenges that families of wealth have is creating a rising generation with ownership mentality" - [Dave]
• "Most of the family wealth that we see lost is due to breakdown in relationships, not poor investment planning" - [Mike]
• "Fair does not mean equal" - [Mike]
• "You either define what it means to be wealthy or you will be defined by your wealth by others" - [Dave]
• "One of the biggest mistakes advisors make is discounting the spouse or not involving the spouse early; they're the ones that are going to nudge the process forward" - [Dave]
• "Your worth is not measured in dollars and cents" - [Dave]

Key Takeaways:

• Dave is the Director of the Global Family Business Institute at the Drucker School of Management. He is the author of "The Family Business Whisperer". His personal mission is to preserve families and perpetuate businesses.
• After selecting Family Business Management as an elective to finish his Masters, Dave realized that several nonfinancial issues were keeping families from making good decisions and this piqued his interest.
• Dave worked for a few years with a broker/dealer till he decided to focus more on working with the families directly. He later worked on his own in Family business consulting while creating a Family Business Program at the University of Nebraska.
• Asking Inspired Questions: What question are we going to ask that will get the person storytelling so we can learn what they care about? This idea was inspired by the effort he had put into the questions he asked his kids to understand them better. Dave describes the framework for Inspired Questions: Avoid yes/no questions; ask open-ended questions that lead people to tell a story. Secondly, don't ask questions you know the answer to. Lastly, ask questions that don't have a right or wrong answer. Having genuine curiosity is much more important than just seeing the interaction as a transaction.
• Although not from a wealthy family, Dave had learned some dynamics of wealth from his family, watching and understanding their actions in regards to finances.
• Dave encourages his kids to have an ownership mindset and not limit themselves, even while keeping the values of a good honest job. What is your ambitious pursuit? If we focus too much on giving the best to our children, we may only pass on valuables rather than values.
• Raising children amid wealth (The 3Gs): Gratitude, Goals, and Grit are tools Dave recommends. Gratitude prevents a sense of entitlement. Having goals helps kids translate lessons learned as they grow while having a worthy pursuit more valuable than money. Grit involves knowing how to say No to your kids, when yes is always an option. How do you bail your kids out when they have trouble?
• Driven by his motivation to have as large an impact as possible in the world, Dave wrote his book titled "The Family Business Whisperer", targeted at both families and their advisers.
• Families often don't train the next generation to become owners because we don't want them to fail while we're watching. However, part of this training can be done by co-investing with kids to meet some of their smaller needs. Additionally, building a working shared ownership mentality among kids can be difficult but is necessary, so it helps to start with small shared decisions.
• It is important to start to see wealth in the different forms it takes, from money to values and now, wellbeing. Parents need to define what it means to be wealthy, particularly understanding the different dimensions there are to wealth as it would be a mistake to simply focus on financial wealth. If we can get people to budget time and resources to develop other forms of capital in the family, it would improve the relationship with financial wealth. Half the battle is just showing up, making out the time to focus on the family, even though it is usually messy in the beginning.
• Mothers of Influence: Often a patriarch is spearheading the family business, however, it is necessary to recognize those who played a support role. These groups of people are often the story keepers of the family business, and ultimately their perspective of the business determines the kind of story passed on to the kids, which affects the mindset of the kids towards the business. Advisors often make the mistake to discount the spouse; no better person is as motivated in pushing the process than the mothers that are fully invested in their kids.
• Determining the role of spouses in inheriting a family business can be very tricky, however, it helps to put in perspective what the goal is, regarding the spouses.
• Families should first identify their hopes and goals concerning the family assets, after which the technical expertise can be invited to achieve those goals. Unfortunately, most families always start by inviting technical expertise to manage the asset before realizing the goals of the family members vary significantly.
• The first step to successfully managing multigenerational wealth is to find someone that will ask the tough questions to identify the hopes and fears of family members.
• Dave's goal at the Drucker school is also to have a global impact, using principles attached to management that align with the methods already employed by the school. It also provides a noncommercial environment to bring families together to be vulnerable and learn together; particularly the rising generation of family business leaders.
• From Dave to his kids: Your worth is not measured in dollars and cents. Happiness is found in ambitiously pursuing worthwhile goals, and that has nothing to do with money either.
  

Episode Timeline:

• [00:50] About today's guest, Dave Specht.
• [01:40] Dave shares his backstory.
• [08:15] Asking Inspired Questions.
• [15:13] How has your understanding of family dynamics played out in your family?
• [18:21] How to appropriately raise children amidst wealth.
• [22:42] The inspiration for Dave's book, 'The Family Business Whisperer'.
• [24:55] Ownership vs Stewardship
• [34:42] Did you introduce this idea of passing down different forms of wealth asides from money?
• [39:18] Mothers of Influence.
• [43:10] Discussing identity as it relates to multigenerational family business and wealth.
• [48:00] How can a family new to substantial wealth start working towards multigenerational success?
• [50:00] What do you hope to achieve at the Drucker School?
• [52:00] Dave's message to his kids.

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Special Guest: Dave Specht.

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Links:

• The Family Business Whisperer — Dave is the author of, "The Family Business Whisperer." Prior to joining the Drucker School Dave helped lead a Family Dynamics team at one of the largest Private Banks in the United States where he trained over 2,500 advisors.
• Drucker School Global Family Business Institute — Dave Specht is the Director of the Global Family Business Institute at The Drucker School of Management.
• Dave Specht — Dave Specht currently serve as the Director of the Global Family Business Institute at The Drucker School of Management. He is an ambassador for the family-owned business and write, deliver keynote speeches and develop programs on topics related to family business. He is the author of, "The Family Business Whisperer" and have a consulting firm called, "Advising Generations."