Next generation embraces private equity, diversification to reshape legacy and mitigate risk
Naim Ali knew differing generational viewpoints on diversification could create tension when he joined SM2 Capital Partners, a private, Calgary-based family-owned holding company that oversees his family’s wealth. It was 2010, and Naim had just left his job as a structured finance lawyer to move back to Calgary for the family business , which started more than 50 years ago when his father, Mohamed Ali, and uncle, Shiraz Ali, bought a Budget rental car franchise in Calgary.
For SM2 Capital Partners, things changed when Naim – who took over as chief executive officer in 2019 – and his brother, Hafiz Ali – who had been working in private equity and is now the business’s chief investment officer – joined the company. From their perspective, the family’s wealth was tied up in owning and operating businesses, exposing them to risks like the COVID-19 pandemic, which had a profound impact across their entire portfolio of hotels and rental car companies.
“The difference was we didn’t own and operate those investments, but used them as a source to diversify the family’s wealth geographically and in areas that we were comfortable investing,” says Naim, who adds that those investments also reduced SM2′s risk exposure. This is especially true amid shifting market dynamics and when it comes to generational differences in goals and timelines. While these can overlap, Segal says it’s important for each generation to set their own objectives and work toward communicating them across generations.
He says the business started as a grocery store before transitioning into food supply for restaurants. In 2015, Flanagan Foodservice entered into a joint venture to acquire Moncton, N.B., food distributor Capital Foodservice. It also acquired a family-owned food distribution company in Newfoundland and competitor Summit Foods in 2020. Additionally, the family enterprise owns s.t.o.p. Restaurant Supply, which supplies cookware and restaurant equipment.
Adveditorial Business Family Business Sm2 Capital Partners Sm2 Capital Naim Ali Flanagan Foodservice Segal Wealth Management Wealth Management Family Investments Calgary Family Office Calgary Holding Company Family Investment Portfolio
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