Ensuring That Wealth Grows in the Next Generation Nancy Bruns Peter Bernick Clint Greenleaf Bruce Hoffmeister, Wilmington Trust Background
The Dickinson Family 8 Generations of a Family Enterprise Dickinson Background 1813 William Dickinson (G1) buys land in the Kanawha Valley of western Virginia to start a salt operation. The company grew and moved to current day, Malden, WV, 10 miles down the river, and grows to become the largest, and longest running manufacturer in the Valley. The original purchase is still owned by the family and has been the site of our commercial real estate development since the mid 1970 s. 1867 After the Civil War, William, Jr. (G2) founds a bank, to revive the industry. The bank grows into the largest in the state, before being sold in 2000, to BB&T. Late 1800 s John Q. Dickinson (G3), son of William Jr, starts to acquire more land, foreseeing the value of coal and other natural resources. This becomes Southern Land Company, which leases property to mining, natural gas, and timber operations. We manage this company with The Other Side of the Dickinson Family. 1902 John L. Dickinson (G4), son of John Q., invests in Carbon Fuel Company, which becomes a very successful coal company. It is purchased by ITT Industries in the mid 1960 s. This transaction provides the stock to start our investment holding company, Hubbard Properties.
Dickinson 1930 s John L. Dickinson sets up 2 intervivos and 1 testamentary trust to protect assets for future generations. The trusts own the shares of the 3 family companies as well as other assets. 1950 s and 60 s: John L. had 5 daughters, 3 of whom married. The Brothers-in-Law, (G5), ran the company businesses and grew the assets. 1970 s, G6 members start commercial development of former salt and coal property, the original purchase, operates under Quincy Coal Company. 1990 s, the trusts are moved from WV to Wyoming to save on trust fees and taxes. Hubbard Properties is founded in 2000, as a WY company, to manage our investment portfolio. 2010 an Investment Committee is formed and a financial advisor is hired to more diligently oversee our portfolio and to plan for future generations. G7 family members join. The coal industry starts to decline. The family begins looking for new opportunities. 2013 Nancy and Lewis, G7 siblings, found J.Q. Dickinson Salt-Works. 2014 A Family Council is formed, includes G8 members, the primary goal is next generation education. Current living members of the family: G6:5, G7:23, G8:54, G9:7. Total: 89, with spouses: 126. Family Business History Lavin / Bernick My grandfather, Leonard Lavin Founder of Alberto Culver in 1955 Grandmother, Bernice Lavin Co-Founder and Treasurer of the Company Mother, Carol Lavin Bernick Joins company in 1974 Father, Howard Bernick joins in 1977 Truly a family business Multi-generational husband and wife teams with complimentary skill sets. 3 rd Generation also joins in limited roles my brother, Craig Bernick, marketing in 2000 after college Me, Peter Bernick Mailroom at 14 years old, but this is a lesson in parenting for another time.
Lavin / Bernick Family and Company Transitions Sally Beauty Acquisitions spur growth outside of consumer products. 1994, Carol and Howard take over as executive leadership of the company Lavin remains executive chairman of the board. 2006, Carol Lavin Bernick becomes Chairman of the Board 2006, Sally Beauty Supply sold to Private Equity. Company is split in half, Howard Bernick retires First Major Family Liquidity Event, Form Family Office 2011, Alberto Culver is sold to Unilever, Leonard Lavin and Carol Bernick retire Largest Family Liquidity Event, Family Office Becomes Wealth generation arm. Greenleaf Greenleaf Family Family Long line of entrepreneurs, grew up watching and learning I had several businesses Paper Route, Candy, (USMC & CPA) Publishing, Bambino Balls, Pigs & Bricks and HomePlate
Previous & Current Generation s Relationship With Wealth & Wealth Creation Lavin / Bernick Understanding Wealth in Our Family Money and wealth could always be discussed openly at home, but never in public Crucial to understand money, but more crucial to appreciate where it came from. Most crucial to understand that in order for current and future generations to live as well as we do, that we need to continue to build. Defer with modesty wherever possible My parents work incredibly hard We are so lucky My grandfather truly achieved the American dream
Greenleaf Family Selling publishing company led to concern how do I raise well rounded, productive members of society Lots of research led to Give, Save, and Spend with the Three Little Pigs and the parent guide Beyond the Piggy Bank Kids remain involved in Bambino Balls, work in others Kids are my petri dish for financial lessons Speaking and teaching companies and families how to talk about money Greenleaf Family Goals Lavin / Bernick Our financial goals are to live very well, but more importantly to have as many future generations as possible have the chance to live at those standards. This means investment and hard work, but also charity, philanthropy and leadership. All of that starts from a very young age. We want everyone to have a first generation mindset. To us, this means trying to build something, and to continue to grow the base of capital.
Education through the Generations Early generations all grew up together, through G6, in the Kanawha Valley, of WV. This created a strong bond and exposure to family business. Quite a few G6, 7 of 10, members left home as adults to raise families and pursue professional opportunities outside the family business. G7 is less exposed. G6 does a great job of organizing family activities for G7 cousins to bond but not much is mentioned about business. Very few G8 members are raised in WV, and they don t know their cousins well. G8 spans from newborn to age 36. There is a loose rule that once you are 30 you can attend the family meetings. Dickinson Ensuring That Wealth Grows in the Next Generation
Lavin / Bernick Takeaways It has been much harder to continue to grow our family s wealth without having an operating business to generate income. I always say that more than 100% of our family wealth came from owning and operating a business. What I mean is, that the investing game is harder to win at consistently. We have tried to get back into owning businesses and are slowly building up a portfolio of assets that will give future generations the same opportunities that we have had from owning a family business. Dickinson I was raised to understand that we were comfortable, not rich. We kept a very low profile. I was given a small investment account when I was 21. I quickly spent it all, and didn t have much guidance with financial markets. At 36, in 2003, having attended 1 family meeting, my father dies. I inherit 12 trusts, with millions of dollars assets I didn t understand. I understood that there must be a better way.
Dickinson My children have experienced my journey with me. As I learned, I shared things with them, and continue to share. We, the larger family, began to brainstorm ways to educate the younger generations and to get people to be more connected. www.myheritage.com, an interactive family tree Quarterly newsletters Family meetings with more group activities, not all business. The Family Council was established to concentrate on this as well, with younger generations.