Passing the Torch: A New Generation of Nordic Entrepreneurs


Mr. Peter Wallenberg addresses the class about next genreation education

The time has come, today marks the final day for the GIP Nordic Family Enterprise trip. We cap off our week here at Stockholm, visiting Mr. Peter Wallenberg, from the prominent Swedish business family, who have given back to their country as bankers, industrialists, politicians, bureaucrats, diplomats, and philanthropists. Today was definitely a highlight for the entire class, as Mr. Wallenberg shared with his  stories about his humble beginnings as a busboy from their family owned “Grand Hôtel” here in Sweden, which is worth mentioning was the only five star hotel when it was founded in Sweden. Mr. Wallenberg had told us about how despite his family’s wishes for him to work on the business side of their enterprise, he decided to start off working at the Grand Hôtel. This experience ignited a flame that lead him to study hotel management in the University of Denver. Eventually, Mr. Wallenberg went back to work in a variety of management roles for the Grand Hôtel, after eventually becoming the CEO for 12 years in 2006.

Mr. Peter Wallenberg
CBS Team presents their findings on next generation education case studies around the world

There is no doubt that Mr. Wallenberg’s colorful and insightful story had the class enthralled and engaged in his history, but what he seemed to speak most fondly about was his work with the Wallenberg Foundation, and his efforts to educate and bring together the sixth generation of Wallenbergs. He has hopes to create a culture of active owners, who are not only responsible citizens, but who are educated on the family companies as well as their goals and aspirations.

Mr. Wallenberg also spoke about the importance of exposing the succeeding generation to other family businesses in order for them to see how they function within the organization. Some of Mr. Wallenberg’s nieces had also shared how because of the opportunities to meet other family members, that those from their generation had themselves organized to see each other more informally outside of such activities. Mr. Wallenberg had shared how much closer the next generation has become because of the efforts to educate and integrate family members with one another. On a larger scale, the family also gets together once a year on “Amalia Day,” to celebrate the life of one of their founders. Here, heads of family share updates within the business and family; it is also an opportunity for the rest of the family to get to know one another. “Parents Day” is another event that allows communication with parents of those within the sixth generation of Wallenbergs.

Mr. Wallenberg with two memebers from the 6th generation

Despite all the efforts to get the next generation involved in the business, Mr. Wallenberg stressed it was important that the will of the sixth generation to become a part of the business would need to come from them, and not to be dictated by others within the family.

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GIP Nordic Family Enterprise class with Mr. Peter Wallenberg
Typical Swedish lunch special with the GIP Nordics
Tour outside the Nobel Peace Prize Museum

After this, we met with Korina Papadopoulou, a second generation communications manager for her family company “Fontana.” Fontana is a food company that imports and packages fresh ingredients such as juices, olives, and cheese from Cyprus, to be sold to the Swedish market. Coming to Sweden as refugees in 1975, Korina’s father started the company soon after in 1978, it is today the leading brand in Sweden of green food from Cyprus and Greek. Joining the session was Annika Hall, who is a family business consultant, and has also written a book about the family’s rich history. Annika had shared about the inspiring story of the family, building a business from the ground up despite their inability to get help from the Swedish banks and government. Korina spoke about how her father’s hard work, together with his passion for sustainability, has built the company to what it is today.

Korina’s passions however, did not align with that of her family’s company. She had studied in the UK to become a journalist, and worked as a producer and director for MTV for most of her professional career. She had never really expressed interest in the family business, nor was she pressured to work for it, and she felt after years away from the family, that it was time to move back to Sweden and see how she could help the family. Today, her brother Loizos has taken over as CEO of the company, while Korina serves as the communications manager, focusing on PR and product development. Korina spoke fondly of working with her brother, which she has said made it a joy to come to work for the family. There is without a doubt, a unique chemistry with their relationship that is definitely unique, and something that the class felt as extremely genuine.

Ms. Korina Papadopoulou talking about her shared values with her father
Ms. Annika Hall, family business consultant to Fontana

Looking back at the Nordic Family Enterprise program trip, I can say with certainly for the whole class, that this was most definitely a memorable and worthwhile trip that has changed some of our perspectives of family businesses. With about half the class having little to no exposure to family business, we had learned not only about structures to help govern and improve the efficiency of family businesses, but also about the importance of values and love within the family to create harmony and lessen conflict to between family and management, but also within the family. Many of us learned that a family business is unique from other businesses, in the sense that not only are you dealing with the growth of the company, and the wellbeing of shareholders, but also with the desires of family and legacy of the company’s founder, which are apparent through the values that are passed on from generation to generation.

Final company visit photo with Fontana




Inspiring Swedish Family Businesses with Legacy of Values


Students enter the Hästens factory and headquarters

Our second day in Sweden took us to the town an hour outside Stockholm where the group met with the owner and fifth generation family member of Hästens, Jan Ryde. For those unfamiliar with the brand, Hästens is a Swedish family-owned producer of luxury mattresses, bed linens, and lifestyle accessories. The company prides themselves on use of raw materials such as cotton, horse hair, wool, and flax. Established in 1852, the now 166 year old company has gone a long way from its sole offering of horse saddles, when they decided during the later part of their second generation to diversify to mattresses, with the decline of transportation via horse.

Today, Jan Ryde continues his family legacy into the 21st century, expanding the brand overseas, as far as Los Angeles and China. Hästens mattresses can be found in many households in Sweden, including that of the Royal Family, for whom Hästens has already produced over 60. As CEO, Jan Ryde brings a culture of family into the organization, with beautifully photographed and mounted photos of all their employees on the factory walls, and very informal interpersonal relationships between management and employees.

Students are introduced to the management team at Hästens
Students present their findings on how to brand a family business


After the visit, the group stopped by a small town on the way back to Stockholm for a quick meal featuring a traditional Swedish take of Goulash, before hiking to see some of the oldest Viking graves in the area. During this time, three of our CBS team also finalized preparations for final presentations to the Grant Thorton Group, and several Swedish family businesses. Grant Thorton is one of the world’s leading independent audit, tax and advisory firms, leading business advising to dynamic organizations.

Professor Angus delivers opening remarks
Some of the presenting team with Grant Thorton
CBS Group photo with Grant Thorton team

Grant Thorton had organized an event for small family businesses interested in advisory and networking opportunities. During the event, Columbia Business School was invited to present topics to certain family businesses who were interested in either expanding operations or learning more about structural procedures to better and grow their respective businesses. There were three groups that presented and consulted for three family businesses, including:

  • Spiltan investment firm, who wanted to learn more about active and engaged ownership. The CBS group informed that company about the importance of communicating values to family members, and including an outside board to challenge internal board members, and engage them to innovate.
  • Lexington Clothing Company is a New England inspired clothing and lifestyle brand that was interested in expanding their international operations around the globe. One of the members who is herself a New England native, spoke about the local trends and preferences for logo-less clothing, in contrast to brands with larger logos in the Nordic regions.
  • Rejler is an engineering construction business in their third-generation that inspires the family members and employees with their core values of passion, empowerment, and health. During this event, the CBS team presented their findings on Family Offices, and how this would be relevant to family businesses in the Nordic region who have to yet created one.  We soon found out that not many Swedish family business recognize or understand the importance of a family business and were pleasantly surprised to learn more about this from our team.

Around 100 family business members attended along with Grant Thorton members and the group from Columbia Business School. Speaking to some of the family business members during the networking event, we were pleasantly surprised to hear that the research and presentations from yesterday were very valuable in setting the informational foundation and groundwork to begin planning their family offices, as well as finding ways to keep owners active and engaged in the company.

Some students with Grant Thorton associates

The CBS group ended the night with some of the young associates from Grant Thorton at a restaurant called Miss Clara, in the trendy area of Stockholm. Students were able to not only reflect on the day’s presentations with the associates, but also find out more about Swedish culture and look for common threads between their different cultures. Today, the team will meet with Peter Wallenberg of the Wallenberg Foundation to present their findings on next generation education.

-Marty Lopez’18

Investing in the Future of Nordic Family Businesses


GIP Nordic Spring 2018 with Founder Torben Christiensen and CEO Simon Christiensen

It was an early start for the GIP Nordic group today, as we headed out two hours from Copenhagen to the city of Kalundborg to meet with the founder and CEO of the Copenhagen Merchants Group. The company is a family business brokerage company which was started by the founder, Torben Christiensen in 1977, and is today one of the largest brokering companies in Europe. Since the company’s early beginnings, Copenhagen Merchants has diversified themselves into four other areas, apart from just brokerage.

  • Brokerage – Leading broker as well as service provider for the agricultural trading industry
  • Biomass Trading  – Heavily involved in global trade and distribution of biomass commodities such as wood pellets.
  • Shipping – Has developed a vessel charting desk , ship management, and ship agency services.
  • Terminals –  Co-managers and co-owns 11 import terminals with a capacity of over 600,000 MT
  • Superintendence –  The company’s latest offering is the inspection services for grain.
Simon Christiensen welcomes the CBS group

Aside from the founder of the company, we also met with the present CEO, Simon Christiensen, Torben’s son and second generation of the family business, as well as Michael Christiensen, a non-family member and COO of Trading for the Biomass division. Among many things, Simon shared with the group about his rather uncertain journey into the family business, as well as his thoughts on the future of the company as well and the potential entrance of future generations into the company.

Simon Christiensen, CEO of CM Biomass

Simon had expressed early on in the session that he had thought of or wanted to enter the family business, for two reasons: one being his desire to create a name for himself within Private Equity, and second was due to his worry that his interests would not align with the company and his father. After conversations with his father, he had realized that not only did he find ease in speaking with his father about the future of the company, but had also seen how aligned he and his father actually were on various aspects of the company. This prompted Simon to join the company in 2003.

Two generations: Simon and Torben Christiensen

Before the Global Immersion trip, the class had discussed a variety of issues within family business, such as the professionalization of the family business, the importance of a third party perspective or consultant, as well as the necessity of board creation. All of which and more were issues that both Simon and his father, Torben, had gracious shared with the class.

In many early stage family businesses, the necessity to build a board does not become apparent to the founder until later on in the company. Torben mentioned how his early board included himself, his wife, a lawyer, and later on Simon once he joined the company. As a smaller family business, he had mentioned he preferred this organizational structure, which allowed to quicker decision making within the company. However, after attending a seminar with the IMD Business School, focusing on development of family businesses, Torben and Simon had begun to see similar patterns with various family businesses, and how the need to professionalize was evident.

Because of this, Torben and Simon had decided to add two more independent board members, and move Simon’s mother and sister to a family council, since their expertise did not lie in future investments and business decisions. However, the addition of board members was an issue that they were initially skeptical about. Simon mentioned it was “like an investment” as the time and energy needed to get the new board members up to speed was quite tedious. In time, the two soon began to see the value of the additional members, with inputs that were more creative, direct, and different than they were used to from their internal discussions within the family. With this change, the company flourished even more in the next years.

Head of Engineering getting the students familiar with the facilities

Looking ahead, we had asked Simon about his thoughts on the next generation of family members entering the family. Currently, the third generation includes Simon’s and his sister’s four children, all of whom are still between the ages of 8 and 14 years. Simon had said that he did not envision any of his or his sister’s children entering the business, since not only did neither of them express an interest, but also since he felt that the chance that they would be the best candidates to lead the family business would be lower than the previous generation. He expressed that he believed that this was so as the larger a business grows, the stronger the need for candidates of better fit rather than just passion for the business. He also felt that it would be unreasonable to pressure his children into entering, but was not completely closed to the idea, should the idea arise later on.

Professor Patricia Angus with Founder Torben Christiensen and two MBA students
Students examining the wood pellets
Simon Charistiensen speaks about the various phases of the facility
GIP Nordic group ready to take the train to Stockholm!

Overall the family business story of the Copenhagen Merchants Group was valuable and highly relatable, in terms of the lessons with their business and those that we had learned in our five weeks of class. Tonight, the group heads to Stockholm, Sweden for the final leg of the program, with a fairly packed day meeting three family businesses companies!

-Marty Lopez ’18

Hilsen fra Danmark!


Today marks our first official day for the Nordic Family Enterprise Global Immersion, and what an exciting day it was! The group started off with a visit to Maersk Tankers, a Danish shipping company which is wholly owned by the A.P. Moller-Maersk Group. To those unfamiliar with the company, A.P. Moller-Maersk (also known as just Maersk) is one of the largest family-owned businesses originating from Denmark, and is a conglomerate which focuses on transport, logistics, and energy. It is also the largest container ship and supply vessel operator in the world.

Model of Regina Maersk vessell
CBS Group photo with Mr. Christian M. Ingerslev of Maersk Tankers

At Maersk Tankers, the group met with Columbia Business School Alumnus, Christian M. Ingerslev, who graduated from the EMBA program in 2011. In this intimate gathering at the Maersk headquarters, Mr. Ingerslev shared with the group about his 20 year journey at Maersk, starting from his beginnings at the company right after his high school graduation, to working with the current CEO of the A.P. Moller-Maersk, Robert Maersk Uggla.


Christian M. Ingerslev (CBS’11), CEO of Maersk Tankers

Apart from talking about the company’s rich history and forward-looking strategies for 2018 and onward, Mr. Ingerslev had also spoken about his experience working for a family businesses, and how it had shaped the person he has become today. When asked about the best thing about working for a family business, Mr. Ingerslev had mentioned that what had impressed him the most was the family’s dedication to their company values. Mr. Ingerslev has seen family’s strong commitment to the companies values far-reach and influence decisions from the executive board, all the way to managers for their individual vessels. Whether refusing bribes to speed up costly processes, or having to let go of executive members in the company who do not necessarily align with the company’s core values, the family has always been fully dedicated to what they believe in. Similarly, Mr. Ingerslev had mentioned that apart from sticking to one’s values, he had also seen significance in recognizing these values when making key decisions for the company. He has seen how every decision made by the family had been a reflection on their core values, and how it had positively impacted the longevity of the company and also created a positive perception of stability for Mr. Ingerslev and other employees within the company. He shared insights into finding success as a non-family manager.


After the meeting with Maersk Tanksers, the group was treated to a typical Danish lunch at the Nyhavns Færgekro restaurant. We ate Smørrebrød, which consists of pieces of bread with a variety of typical Danish toppings such as smoked salmon and a variety of cheeses. The restaurant was located in Nyhavn, a canal and entertainment district, which began as a fishing port in the 17th century.

Smørrebrød, a typical and popular Danish dish.

In the town of Veksø, 45 minutes outside of Copenhagen, the group met with Hatla Johnsen, a 7th generation member of a family business. She welcomed the group to her farm, Egedal Gaard, which she purchased in 2016. She currently lives and works at Egedal Gaard with her family, running her farming business and a new start-up focused on online education. Ms. Johnsen spoke about her family business, the Scandinavian Tobacco Company, founded in the 1860’s. She mentioned how despite being a part of a growing family of over 30 members, none of them were working in the business; they had decided to hand it over to professionals to run. The family continued on as majority shareholders. The family decided to sell the company in 2008, with differing opinions within the family as to where the business should go. With a large amount of liquidation once the company was sold, Ms. Johnsen and her family had decided to set up a family office to take care of their various remaining assets and investments, which her siblings and mother continue to grow.

Ms. Hatla Johnsen speaking about her experiences as a 7th generation family business member.
Students enjoy time with miniature ponies at the Egedal Gaard Farm.

Tomorrow the group will be meeting with Copmer, one of the largest brokering companies in Europe. It will also be the group’s last day in Denmark before heading to Stockholm.

– Marty Lopez’18

Off to the Happiest Country on Earth!


That’s right— The United Nation’s World Happiness Report had ranked Denmark the Happiest Country on Earth between 2013 to 2015, with Sweden rounding off the Top 10. 

Before starting off the MBA at Columbia Business School, I had been told by several students in the Family Business Club that the Global Immersion Tour to the Nordic countries was definitely going to be a trip that couldn’t be missed. With everyone’s glowing recommendations in mind, I knew that this was going to be one of the immersive CBS experiences that I would have to most definitely have to be a part of. Finally, after five weeks of in-depth learnings into Nordic Family Business Enterprises, our group of 26 Columbia Business School students, will finally begin our Global Immersion Tour to the Nordic region. The week-long tour will kick off in Copenhagen, Denmark, and will continue on to Stockholm, Sweden.

Snapseed 3.jpg

Over the past few weeks, our class has had the opportunity to learn everything from political, economical, and family business trends in the Nordic region, to various aspects of Multi-generational Nordic Family Enterprises.  With guest speakers such as Anna Throne-Holst (granddaughter of Marabou founder) and CBS alumnus Nikolai Jensen (from the Jensen group), the class was also able to gain in depth insights into family politics in Nordic family enterprises, and how the region’s culture had affected certain aspects of the business, such as governance and succession.

For some of the students in the class, this would not only be their first time in the Nordic region, but also their first time to have taken or been exposed to a family business course during the MBA. Professor Patricia Angus had stressed the importance of understanding ideas such as the Three-Circle Model, to better understand the dynamics in a family business, as well as certain inheritance laws, and stakeholder theories that make doing family business in the Nordic region so unique to other countries. All of which will be extremely valuable when visiting and learning from various Nordic companies, and meeting influential individuals from family business such as Peter Wallenberg, who was recently at CBS’ Family Business Conference, which was held at Columbia University last February 9th.

Our extensive five-week preparation, and exploration into Nordic heritage will surely be an asset to all of us, as we gear up for a week of intense immersion into the region’s culture, which should allow all of us the chance to exchange our ideas and insights on the highly innovative Nordic countries, and how they have uplifted the entire region to an aspirational status.

I’m excited to share all our new experiences and learnings from our 2018 Nordic Tour!

-Marty Lopez ‘18

Guatemala: Foundations

Guatemala’s GDP per capita is comparable to that of the US in the late 1800’s. There is a long way to go for the country to achieve a good level of development. With such large challenge, who is leading this much-needed growth and making the necessary investments? At the moment, a few family-run conglomerates are taking the lead and setting the foundations for Guatemala. As we try to relate to the business environment in America, the scenario has similarities from how the US was in the late 19th century, but brings new challenges. We visited two of those business groups, in the construction and in the food and beverage industries.

Cementos Progreso manufactures cement and aggregates. The facilities are world-class, as could not be different as they operate in a global environment. However, they face two challenges that are unique to developing countries. In order to keep expanding, they first need to look externally for investments. Secondly, they need to look internally to develop their community. As an example of the external investment side, the company is currently building a new plant which required over 700M dollars. The financing came from retained earnings, loans from local banks, and an international bond. Only mature companies are able to build this complex financial structure in the country.


Field tour at Cementos Progreso

Cerveceria Centroamericana is in the food and beverage industry, with beer as its main product. They are currently doubling the capacity as they face competition from AB Inbev, the largest beer company in the world. The group also has investments in energy, packaging, infrastructure and real estate. Their CEO, Guillermo Castillo, sees himself as an asset manager who seeks opportunities for growth in different lines of business.


With Guillermo Castillo, CEO of Cerveceria Centroamericana

Both businesses are aware of the need to develop their communities. In Guatemala, it is not enough to work on the supply side. Smart business also need to help aggregate demand expand. Among other initiatives, they run amazing projects focusing on education and food. A lot of kids in Guatemala do not get adequate nutrition, preventing them from reaching their full intellectual capacity. In order to tackle it, Cementos Progreso runs a program to cultivate a local tree that is rich in nutrients. Cerveceria Centroamericana runs a program through their foundation, providing daily meals to hundreds of students at school. In addition, both groups run schools and even employed some of their students after graduation. The ultimate goal is to create a virtuous development cycle.

Social projects at Cementos Progreso

The final part of the Chazen tour will focus on more initiatives with social impact. Before that, a final message from José Raúl, CEO of Cementos Progreso: “If you want to help people, create jobs that generate wealth”.


– Pedro Barata ’18

Nordic GIP Part 3: The Lessons Taken Home

Kit O’Connor ’17

NEW YORK – This is, alas, the final time you’ll be hearing from me. Which sounds so morbid, but really, it’s just because my work as the social media guru will conclude with this post, and then I’ll graduate and won’t be able to take week-long trips around the world on random Spring Breaks anymore! A single tear rolls down my cheek…(to match the single dollar left in my bank account).

The gorgeous Nyhavn district in Copenhagen – be sure to take the canal tour (bottle of wine or six-pack optional, but highly recommended).

But! Sweden! Denmark! Families! Business! That’s what this is about. I struggled a little bit with structuring this post, so like any good consultant, I ended up with three main takeaways: one negative, one positive, and one that’s purposely a bit amorphous (I know, I know, show, don’t tell). Let’s get started.

The bad: One of our first visits was to the American Embassy in Stockholm, where we met with a number of senior embassy officials and learned about their initiatives for American interests in Sweden and how they can help US businesses make inroads around the globe. That meeting was perfectly fine, and we were impressed by the number of speakers who made time out of their day to meet with a group of Columbia MBAs.

However, the security protocols necessary to get into the embassy honestly made me embarrassed to be a United States citizen – I saw a young girl, who couldn’t have been more than four years old, shouted at through a glass wall, forced to take off her coat on a chilly day, and contort her feet and body to prove, I guess, that there were no threatening items on her, all while her mother had to stand twenty feet away (yes, we all had to do the same). I’m proud of my country and believe there’s a reason that our mantra of freedom above all attracts the most innovative and accomplished people to learn, teach, and start businesses – by no means does that mean that our people or politicians are always correct, though I do like to think that we represent the opportunity to make life better, no matter who you are or where you come from. But when I’m reminded of that scared little girl and her introduction to America, I wonder whether we’ve become a bit too possessive of our liberty.

(steps off high horse)

OK, so, the candles aren’t exactly the focus of this photo but they really are everywhere!

The good: Hygge! Hygge, the Danish concept of “everyday togetherness”, which has certainly seeped across the border into Sweden, and definitely enjoys a robust ad campaign in the US.

There are a couple ways that hygge was present during our trip. The first is in the purely physical, and can be represented best by the abundance of candles in nearly every conference room that we met in. What would certainly be a fire hazard in America is a source of coziness and serenity in Scandinavia: proof that work in the Nordic is supposed to be comfortable in addition to being productive.

The second is the attitude that work in Sweden and Denmark is generally a two-way career contract. I alluded a bit to this in prior posts, but it deserves a specific callout here: employment in Nordic is designed to last much longer than in other areas of the world. Compared to the two ends of the spectrum – the US, where workers are used primarily for efficient productivity, and, say, France, who has extensive protections for employees to keep jobs – Scandinavia firms seem to invest more in training and education for their workers, and those workers in turn accept slightly lower wages for a career that can span decades rather than years. I will put a caveat on this: my belief may be skewed a bit due to small sample size or meeting exclusively with family firms.


The fuzzy: Speaking of family firms…another student and I were talking with Professor Angus about one small family firm’s search for a CEO. We wondered why the search never seemed to find a good candidate: the business was established, profitable, and had a well-oiled supply chain and production facility. In fact, we softly felt that just about any of the students on the trip would be well-positioned to run the company after our education at CBS.

However, Professor Angus asked one question: “Could you run the firm AND deal with the family issues behind the scenes?” We immediately shook our heads and realized THAT’S what makes family firms different – it’s never just about the money, contracts, or factory. It’s about everything that came before and the legacy that will be. One founder noted, “That’s my name on the jar. What will it stand for after I’m gone?” Will an outsider ever be able to live up to that attitude?

So in the end, neither the Nordic region nor family businesses can really be put into neat little boxes (classic consulting again: it depends.) But, like each Chazen trip I’ve experienced, I feel I now truly have an informed opinion on the region and will be better able to understand and transact with my future Swedish and Danish colleagues and business partners. Thanks again for reading along with my journey, and looking forward to my next chapter after Columbia!

A trip we’ll never forget.

Nordic GIP Part 2: Descendants and Decisions in Denmark

Kit O’Connor ’17

COPENHAGEN – Um, well, COPENHAGEN-ish. Mostly written on a flight from Copenhagen to London, which means I’m still very technically on the trip! And feeling much better; thanks for everyone who expressed concern (both of them).

OK, so, last blog post, I wrote mostly about the Nordic part of this trip. Obviously, there’s another critical component of the class: family business! It was pretty amazing hearing the stories of so many people in the Three-Circle Model of the Family Business System, especially those with close connections to CBS. One quick caveat before I get started: our hosts were incredibly open with their personal experiences, so some of the references below are slightly changed or frustratingly vague in order to protect their privacy.

Three Circle Model of the Family Business System

One big overall theme was the idea of pervasiveness, which manifested itself in two main ways. First, literally everyone, and I mean every one, who was a family member talked about how family dinners would always revolve around the family business, unless someone, almost inevitably Mom, banned the topic. For anyone who didn’t grow up in a family business (author raises hand), this is a sobering reminder of the all-encompassing nature of such a venture.

Second, we spoke a lot about the “long shadow” effect of company founders, even long after retirement or death. At Maersk, our host spoke in hushed reverence of Mr. Moller, the only person he didn’t refer to by first name. At Ikea’s headquarters, our tour guide told the story of Ingvar Kamprad, Ikea’s founder, coming in with an eleventh-hour request (ha, no, it was definitely a demand) that the restaurant be removed from the first floor of the massive open-concept four-floor complex. He felt that if employees wanted a hot meal, they could trek ten minutes across the parking lot…to an Ikea retail store.*

Just a perfectly normal corporate headquarters…

The other word that every presentation contained was choice. The amount of choices that need to be made in a family venture are enormous, and start at a very young age. One current CEO spoke of his father pointing to a chair and telling him that he’d sit there one day – no choice for the five-year-old kid there. More than one had lives and un-related businesses in other countries when the call came – would they give it all up to come home?

This choice element seemed to me to hint at why family businesses have so rarely persist beyond three or so generations. Does the grandson truly want to be there or is it just expected? Are there the right management skills to go along with the last name? Current CEOs we spoke to who had experienced the chance to work outside the family business before moving back seemed much more happy with their firms, as it was largely their decision to be there. Others felt trapped – one even mentioned possibly selling the company, but as he put it, how could he? It’s his name – his legacy – on that bottle!

That will do it for in-country updates from me. Time to figure out where and when my classes are tomorrow! I’ll see you again in a week or so with a final recap of the trip.


*Alright, this is a little harsh. His reasoning was that upper management couldn’t lose sight of what was happening in the stores and this was a good way to keep them engaged there. Ikea also seems to fancy itself a bit of a socialist workers’ paradise, constantly stressing that if something is good enough for an entry-level employee, then it must be good enough for management as well. In the end, a small-ish cafeteria with prepared meals replaced the restaurant.

From 25°C to 25°F

Looking out my window at a grey, snowy Morningside Heights, it seems hard to believe that just a few days ago I was still in bright, sunny Santiago.  Our trip was exhausting, amazing and surprising all at the same time.  Though our packed days of programming would wear out even the most seasoned business traveler, we were all so fortunate to have had the opportunity to explore this country and meet with a few of the businesses that have made it a success.  We learned about the specific developments in the Chilean economy, we learned about the general challenges faced by markets shifting from an industrial to knowledge-based economy, and we got to know our peers better.  Since you have heard a great deal from me about my thoughts on the program as well as our meetings during the week, I’d like to use my last blog post as a chance to share the thoughts of my classmates from the program.  Their perspectives, questions and commentary added so much to my experience in Chile!

“The fact that we were able to look behind the scenes and communicate with the highest levels of management of interesting companies was very valuable. I think Chazen organized everything very well, and most compliments goes to Carmen Concha [program teaching assistant] who has been able to pull off this huge effort without a hitch. It was surely one of my CBS highlights.”

–          Chayenne Wiskerke, CBS Class of 2013


The group enjoying the private winery tour on the last day of our trip
The group enjoying the private tour  at Amayna Winery on the last day of our trip

“I thought the trip was a huge success. It was quite a learning experience to hear from executives in some of Chile’s largest businesses about their growth strategies in Latin America’s most stable economy. I was also impressed by how much I learned from my classmates. Sixteen different countries were represented on the trip, and it was great to compare notes about the different cultures. Carmen, our TA, Professor Preston, and Katrina from Chazen all did an amazing job at putting this trip together.”

–          Adam Breitman, CBS Class of 2013

Very patriotic shot at the Mercado Central
Very patriotic shot at the Mercado Central

“The trip was a fabulous opportunity to learn about the Chilean economy as well as successful business models in South America. The speakers were very inspiring and the factory visits were particularly interesting. Also, it was great to meet so many new classmates.”

–          Anne Kronschnabl, CBS Class of 2014

Getting a tour of the pasta production facilities at the Carozzi factory
Getting a tour of the pasta production facilities at the Carozzi factory

Chile stands out as an economy and a country destined to be a leader in Latin America and possibly on the global stage. The sheer determination of its immigrant-infused population has really made a huge difference in the country and the region. Similarities can be easily drawn between Chile and the US during its growth post-World War II.  Chilean government is a great player in this regard, providing the appropriate working environment and facilitating the impressive level of growth and prosperity.  I am certain that, as Chile transforms more of its working class from poverty to middle class, new challenges await. It will be interesting to see how Chile grows over the next 30 years.”

–          Varghese Mathew, CBS Class of 2013

Though I mentioned it time and again in this blog, Chile has impressed me in so many ways.  This country has been through many difficult times and only recently re-joined the democratic world as it continues on its path toward development.  Over those past two decades- relatively little time when talking about the development of a country- Chile has become one of the leaders in the world in terms of economic growth and has truly created a development model worth of emulation by any country seeking to boost economic growth and the living standards of their citizens. The eagerness of everyone we met with to help us learn more about this amazing market was key to making this a very memorable and informative trip for all of us.

Hasta pronto,

Hannah Stern ‘13

Los Vencinos [The Neighbors]

Since arriving here in Santiago, it has been emphasized time and again that Chile relies strongly on its open, export-driven economy.  While the open economy strategy has worked very well here over the past decade, there are complications on the horizon.   Los vecinos- or the neighbors- of Chile include Peru and Argentina as well as regional partners such as Colombia.  While Peru and Chile have a very strong working relationship that I will discuss later, Argentina is facing a number of its own challenges that are beginning to impact the way other countries in the region perceive it. And the Colombian market is heating up quickly, making entry expensive.

As Chile’s second largest and formerly most significant trade partner, Argentina’s trade regulations create complications for a country where exports are key.  While Chile is all about efficiency, Argentina has a number of protectionist policies in place as well as a very powerful unionized labor force. In 2008, the Argentine state repossessed assets from a joint venture with Spanish energy company Repsol, sounding alarm bells for the international investment community.  Among the biggest critics of these problematic policies has been formerly close ally, Chile.  When asked to comment on recent movements toward a further closed economy in Argentina, Gonzalo Arenas, president of the Chilean parliament’s Economy Committee  said, “The protectionist policies not only generate disappointment but also attack free markets and free international trade principles. We should begin thinking in reciprocity measures.”

We heard a more tempered but still very concerned attitude toward Argentina and future investments there almost every time we spoke with a company representative.  Particularly interesting was our conversation with Falabella, Chile’s largest retailer.  It should also be noted that the company has diversified into a number of sectors including home improvement stores, private label credit cards and retail banking services.  Our speaker mentioned a number of interesting facts on growth of Falabella’s sales in Chile, Peru and even Colombia but took a long pause when glancing to the near side of the map at Argentina.  “It’s difficult to manage our product mix in our department stores there because there are many restrictions on the types of goods we can bring into the country.  And banking services there are a substantial challenge. At present, we do not have plans to grow in Argentina simply because we view the risk as excessive relative to the potential growth in profitability.”  While prospects for continuing investment in Argentina are not strong, there are others in the region that Chile seems very interested in.

Peru has been mentioned by almost all of the companies we met with- whether Banco Santander, retailers Falabella, food producer Carozzi, even the Western world’s biggest copper producer Codelco– as a strong candidate for future growth.  Chileans also seem to view Peru as a trailing indicator of their own progress.  Chile seems eager to integrate its economy further with that of Peru.  For example, as we learned at a meeting with Superintendencia de Pensiones (Pension Oversight Board), Chile has passed legislation allowing Peruvian workers to move their pension withholdings back into a Peruvian pension plan if they choose not to stay in Chile. Time and again we heard that Peru is still between five and ten years behind Chile but that it is showing strong signs of moving in the right direction.

And then there’s the more distant but  dynamic Colombia. One of Chile’s largest food product producers, Carozzi, expressed a strong desire to move into the market but pointed out a number of challenges. “We have to make an investment in Colombia or we won’t remain regional market leader. But we need to make it worth our while. That means strong brands with strong multiples and high volume.  We don’t see that company available for acquisition in the Colombian market right now at a price we consider exceptable.  Most candidates have valuation of upwards of 20 times EBITDA.” said Gonzalo Carozzi, partial owner and CBS ’10 alumnus.

Though we have been extremely busy attending mining presentations, speaking with tech startups, touring factories and even tasting wine, we did find time to fit in some fun.  Below are photos from a number of events and sightseeing activities we’ve done over the past few days:

CBSers hanging out in front of La Moneda, the equivalent of the White House in Chile
Data from Cochilco Mining presentation
Group shot after an amazing diner at the family home of our TA, Carmen Concha!!