When world-famous investor Warren Buffett coined the expression ‘skin in the game’, he was referring to executives who use their own money to buy shares in the companies they’re running.
In all family fi rms, the founding family has a significant stake in the business and one or more relatives – or ‘kin’ – hold senior management positions. The title of our second global Family Business Survey refl ects this duality.
Family firms have both ‘skin’ and ‘kin’ in the game. The same concept underlies the well-known model of the family business as three overlapping circles: the company, the owners and the family (see Figure 1).
The model shows the range of interests that exist, and where they intersect or diverge. It demonstrates how the perspectives of the different parties depend on where they stand within the three circles as much as they do on the personalities of the people involved.