Inaugural BBH Private Business Owner Survey: A Business Owner’s Approach to the Economy and Investing

July 25, 2023
  • Private Banking
BBH Principal Adrienne Penta looks at insights gathered from our inaugural Private Business Owner Survey, focusing in on the attitudes of private business owners toward economic uncertainty and investing.

This year, Brown Brothers Harriman (BBH) conducted an inaugural Private Business Owner Survey. The respondents represented 400 U.S. private businesses with enterprise values from $10 million to $500 million and more. Of the owners surveyed, 87% represented family-owned enterprises; 74% were male, and 26% were female. We asked about how the business affects their family, how they think about the future, what might happen when they step away from the business, and how business strategy might be changing due to economic conditions.

The results were fascinating.

  • Business owners report that they have estate plans (98%) but haven’t communicated them (94%). 
  • They have endured family disagreements about the business (84%), yet it is very important for most (85%) to keep the business in the family.
  • While all have taken some steps to prepare the next generation to lead the business, most have not yet defined the roles of next generation leaders or not communicated their plans fully (75%).

Here, we examine the attitudes of private business owners toward economic uncertainty and investing in more detail.

Economic Uncertainty

Private businesses – and their owners – have long been the backbone of the U.S. economy, and in the face of economic uncertainty and changing market conditions, we found that they remain resilient and have favorable outlooks for their businesses. The respondents view their businesses as stable in the current economy, with 71% saying that their business is mostly or fully recession proof, and a whopping 95% report that their business is at least somewhat recession proof.

71% of surveyed business owners say their business is mostly or fully recession proof; 95% say their business is at least somewhat recession proof.

While economic uncertainty influences decision-making for most business owners (82%), the majority (69%) are increasing their efforts to grow the business through investment in light of uncertainty; only a few (14%) are decreasing efforts to grow in favor of maintaining liquidity. Business owners with experience under their belts, those over age 40, are even more likely to increase their push for growth during volatile times, with 74% reporting increased efforts to grow.

82% of surveyed business owners say economic uncertainty has influenced business strategy.

A turbulent economy can also cause business owners to consider selling the business. Seventy-six percent agree that they “lean more toward selling the business” when navigating through economic uncertainty. That number increases to 80% for those working in the company in a senior leadership role, rather than in a governance or more passive role. Only 50% of board members or owners holding other advisory roles say the economic uncertainty causes them to think more about selling. Naturally, senior leaders take the brunt of the economic stress – perhaps making decisions about layoffs or cutting costs – that cause them to lean toward an exit in tough times.

76% of surveyed business owners agree that every time they have to navigate through economic uncertainty, they lean more toward selling their business.

Investing for Business Owners

In working with private business owners at BBH, we recognize that the business is often the owner’s most significant asset. It also represents a concentrated and illiquid holding. In considering overall asset allocation when investing in marketable securities, every business owner has a different perspective on how the business should be factored into asset allocation, or not, and whether the business represents a fixed income-like risk and return profile or whether it is a more volatile asset, like private equity or even venture capital.In the survey, we asked about the role that the business plays for these owners in their overall investment portfolios. Two-thirds of business owners say their ownership of the company is “more like a private equity investment,” while only a third view their business as “more like a fixed income investment.” Just 2% reported not viewing the business as part of their investment portfolio at all.

2 in 3 surveyed business owners (66%) view their business more like a private equity investment; 33% view their business like a fixed income investment (41% of female respondents, 29% of male respondents)

Interestingly, these numbers look different when using a gender lens. Women business owners see their companies as more stable investment vehicles, with 41% classifying the business as more like fixed income (vs. 29% of men). It is hard to know why more women owners see their companies as bond-like performers; one possibility is that they make more conservative business decisions and reduce the risks inherent in the business to a greater degree.

If you are interested in the full survey results, please visit In addition, we are happy to discuss the survey outcomes and what they might mean for you, your business, and your family, so please feel free to reach out to your BBH relationship manager.

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InvestorView Winter Issue 2023

In this issue of InvestorView, we discuss our outlook for the markets and economy in 2023, explore how to guide trustees to ensure that trust distributions are rooted in purpose, and look at how to manage cognitive bias.

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