How African family businesses are growing their wealth

African Business talks to Sandeep Main, partner in tax and regulatory services and KPMG One Africa head of private enterprise, about how African family businesses are managing their wealth and making provision for the needs and priorities of the next generation. African Business: How can African family businesses transition from local operations to pan-African or global financial empires? Sandeep Main: The transition is very intentional and doesn’t happen by accident. There are a few key steps we consistently see. First is governance. Families that scale successfully tend to move from highly centralised, founder-driven decision-making to robust governance frameworks that include boards with clear mandates, defined roles for family and non-family executives and documented decision processes. Second is legal and organisational structuring. Establishing a holding company at the top, with subsidiaries in each country or business line, allows the group to grow, raise capital and manage risk in a more coordinated way. Third is capital and partnerships. Accessing syndicated bank funding, development finance and sometimes capital markets, and partnering with global brands or investors, helps them accelerate expansion while sharing risk and know how. Finally, there is a mindset shift; from “we run a business” to “we steward a portfolio.” That’s typically when family offices or dedicated investment vehicles emerge, managing operating companies alongside real estate and financial assets. By way of illustration rather than direct comparison, groups such as Bakhresa and MeTL in Tanzania and Bidco in Kenya show aspects of that journey; from single-country operations to multi-country, multi-sector groups. On a continental level, Dangote in Nigeria is another example of progression from trading to industrial and now broader investment influence. What they broadly share is disciplined reinvestment, structured ownership and a clear long-term vision. What specific operational and structural challenges do these large family businesses face when rapidly scaling? We tend to see challenges emerge in two main areas: operations and structure. Operationally, growth often outpaces the organisation’s systems and processes. As activities expand across multiple geographies and sectors, weaknesses in financial reporting, risk management, IT infrastructure and data become more apparent. Decision making can remain concentrated with a small number of senior family members, which creates bottlenecks when the organisation needs faster, delegated execution. Cross-border expansion adds regulatory, tax, currency and logistics complexity. Coordinating operations across different legal environments and business cultures requires capabilities that may not yet be fully developed. Structurally, ownership and governance can become sources of tension if not clarified early. Shares may be held in individual names across several branches of the family without a coherent shareholder agreement or succession plan. Divergent expectations about reinvestment, dividends and control can lead to misalignment just when the business needs unity and clarity. The inflection point is essentially a choice: remain a “family-run enterprise” relying heavily on informal arrangements or evolve into a “family-owned institution” with professional management and formal governance designed to support scale and continuity. A younger, highly tech-savvy demographic has built wealth in sectors like software. How do the wealth needs of this new generation differ? Traditional wealth builders in Africa typically accumulated assets over a number of years in commodities, trade, manufacturing and property. Their comfort zone is tangible, often local assets, and they tend to place a premium on control, stability and relatively conservative diversification. Structuring and succession may be guided more by family norms than by formal frameworks. The younger, tech-savvy cohort has often experienced liquidity events earlier, through software, fintech, or other digital ventures with international investors and markets. Their thought process is much more in portfolio terms: venture capital, private equity, listed securities, impact vehicles and global diversification spanning the US, Europe, Asia and beyond. They are more inclined to seek institutionalised solutions: dedicated family offices, trusts or foundations, cross-border holding structures and integrated tax and estate planning. They place greater emphasis on purpose; environmental, social, and governance (ESG) concerns, impact investing and philanthropy; and on lifestyle considerations such as global mobility and multi-jurisdictional living. While the traditional generation is typically asset-anchored and control-focused, the newer generation tends to be liquidity-anchored, globally oriented and value-driven.