On Thursday November 30, UBS published its ninth study of billionaires, highlighting a fundamental shift in the way wealth is acquired. For the first time since the study began in 2015, a significant number of new billionaires have inherited their wealth rather than generating it through their businesses.
UBS’s recent study on billionaires highlights a fundamental shift in the wealth structure among this financial elite. Entitled “2023 Billionaires Ambitions Report”, the Swiss bank’s study indicates that billionaires have increased in number and overall wealth over the past 30 years, thanks to technological advances, expanding financial markets, rising real estate and the rise of emerging economies.
The study highlights, “for the first time” since the study began in 2015, a significant proportion of new billionaires having inherited their wealth rather than having created it through their own businesses. This generational transition marks a turning point in the usual composition of this financial elite.
Between April 2022 and April 2023, 137 individuals rose to become new billionaires, 53 of whom inherited their wealth. Their cumulative wealth amounts to $150.8 billion, surpassing that of the 84 new entrepreneurial billionaires, whose total wealth is estimated at $140.7 billion.
The UBS bank, which oversees $5.5 trillion in assets, has business relationships with almost half of the world’s billionaires, and works with the second, third and fourth generations of families.
The rise of heirs
The drying-up of IPOs in 2022 and early 2023 appears to be a significant factor favoring this development. Many entrepreneurs faced difficulties in monetizing the value of their businesses, contributing to the rise of heirs.
Benjamin Cavalli, Head of Strategic Clients at UBS, points out that “heirs are gaining prominence” due to these particular circumstances. He predicts an amplification of this trend over the “next 20 to 30 years”, when “more than 1,000 billionaires will pass on an estimated $5,200 billion in wealth to their children”, according to the bank’s calculations, adding up the fortunes of billionaires aged 70 or over.
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