Next-Generation (Next-Gen)
Next-gen refers to the younger generation of a wealth family who may influence or assume control of governance and investment decisions over time.
Allocator relevance: A leading indicator of mandate evolution—next-gen involvement often correlates with shifts in sector focus, risk appetite, and decision chain.
Expanded Definition
Next-gen involvement can reshape investment philosophy, governance structure, and how opportunities are sourced and evaluated. Some next-gen investors push into venture, technology, and impact; others professionalize governance, create IC structures, and formalize mandates. The transition period can also introduce complexity, with multiple decision-makers and evolving approval pathways.
For allocator targeting, next-gen presence can change who you should speak to, how to frame an opportunity, and what constraints matter.
How It Works in Practice
Next-gen may start as observers or committee members, then gain discretionary authority. Families often form councils or governance documents to guide the transition.
Decision Authority and Governance
Governance maturity determines whether next-gen involvement produces continuity or fragmentation. Clear roles, voting structures, and dispute resolution reduce unpredictability.
Common Misconceptions
- Next-gen always increases risk appetite.
- Next-gen means the older generation is out.
- Next-gen involvement is obvious publicly (it often isn’t).
Key Takeaways
- Next-gen is a governance and mandate signal.
- Decision pathways can change during transitions.
- Role validation and recency matter more than titles.