The FST Family Succession Triangle Model (Opening Piece)

I have to write this down —

The question of "taking over" or "succession" has been with me for more than 25 years — from a seven- or eight-year-old child wanting to make her parents proud, to an adolescent existential crisis, to my early adulthood's mix of dependence on and rejection of the resources and platform my family gave me, and then to learning how to "fly on the wind."

You could say that, for me,

understanding myself and understanding succession are intertwined and inseparable.

You could say I'm writing this piece for myself.

Before I begin

The FST Family Succession Triangle Model is an original theory and model I've distilled from decades of thinking about and studying "family succession." At first glance it's a simple triangle, but each element connects downward to its own sub-models.

Writing this theory down has long been a wish of mine.

But I wanted so badly to write it well that for years I couldn't bring myself to start. Because I know it isn't comprehensive enough; it can't perfectly cover every aspect of family succession. Succession involves social change, organizational innovation, scientific progress, the stretching of human nature, even our resistance to death — family succession is the most delicate patchwork of business, law, technology, the humanities, art, devotion and love, persistence and letting others flourish.

Still, I dare to hope to finish this work. It may cause some misunderstandings or expose my foolishness, but it might be of some use to families and friends who are thinking about succession. Because they always hope to think about family succession systematically: in time, looking beyond a single generation to see what this generation can contribute on a hundred-year scale; in space, looking across at how people in other cultures and regions of the world realize the vision of succession.

I hope FST can be a usable "walking stick," like the theories we lean on to understand history. That it can spark some thinking and some longing, so that beyond pursuing one generation's achievements, we can also grow creative aspirations on a longer time horizon and with a wider reach of influence. If readers have any further corrections to this theory, please do let me know, so I have the chance to improve it. What is "family succession"

When I began thinking seriously about "succession," I found a very simple fact that is easily misunderstood —

Succession isn't a rich people's thing; it's a human thing.

It isn't that "complicated thing" that happens in billionaire families, multinational companies and trust structures,

but an "instinct" embedded deep in our genes from the moment we humans first had surplus food and tools.

Back then there were no companies, no asset allocation, no lawyers.

But one thing had already quietly appeared:

"I hope what I worked hard to gain can go on nourishing the people I love."

In a sense,

this is civilization's earliest spark.

What is a family? Not wealth, not headcount

I'm often asked:

"How many assets make a family?"

"How many generations make a family?"

"Do you need US$1 billion before you need succession planning?"

Let's take a different case:

A rural family where two brothers completely fell out over a tile-roofed house worth 50,000 yuan.

That is also a succession case. What they're fighting over isn't a tile-roofed house, but:

who is entitled to inherit

who is seen by the family

whose contribution is recognized

who has the right to decide the family's future

Family isn't a concept of "scale"; it's a concept of "relationships."

As long as a group of people share a destiny, stories and responsibilities, they form a family.

The FST Family Succession Triangle Model

In this model, I move the focus away from specific tools and "techniques" like "structure design," "tax planning" and "business succession," and back into a framework at the level of "the Way" —

defining the three elements of family succession: Family – Enterprise – Capital, and the dynamic energy system the three of them form.

Element one: the family's members

— the source, the spark, and the ultimate meaning.

A family's true foundation isn't the assets on the books or the size of the business, but the values, knowledge, judgment, resilience of character and mutual trust accumulated in its members.

These human assets can cross borders, cultures and systems, flowing, migrating and rebuilding with the family.

Just like those peoples throughout the long river of history who lost everything again and again and rebuilt their future each time: as long as the spark of "people" stays lit, a family always has the ability to start over.

Element two: the family's enterprise

— an amplifier, and a training ground for people.

The enterprise isn't only the family's achievement; it is also the amplifier of the family's spirit. It carries culture and mission, and through organization, products and platforms, it spreads the energy of "people" into stable and lasting creativity.

Driven by the right mission, the enterprise can keep iterating, transforming and expanding, becoming the most important platform for the family's dialogue with its era.

Element three: the family's wealth

— a reservoir, a store of energy and a converter between forms.

Capital is a buffer against risk, fuel for innovation, and the family's instrument for keeping its commitments to society. It can convert freely between the tangible (assets, equity, cash flow) and the intangible (reputation, knowledge, philanthropy, social trust):

in prosperity it settles into assets, in turbulence it evaporates into the intangible, and in recovery it condenses back into new opportunities and resources. Only capital that flows, converts and has direction is truly living capital.

The "energy channels" circulating among the three

1. People ⇄ Enterprise

People create enterprise; enterprise tempers people.

When people's values and abilities are poured into an enterprise, it gains resilience and the vitality to ride through cycles. An enterprise is born of people and changes because of people.

From a higher vantage point, the enterprise is also shaping people. It isn't a burden on family members but their place of practice:

in the enterprise, the younger generation faces real markets and competition, and so develops judgment;

in the enterprise, values aren't written on the wall but tested through decision after decision;

in the enterprise, people of different generations work together, and culture is passed on and also iterated;

in the enterprise, human capital isn't "carried on your back" but "put on the field."

For people, the enterprise is a mirror, a school, a laboratory. A person's value is honed ever clearer in the enterprise.

2. Enterprise ⇄ Wealth

The enterprise generates cash flow and builds brands; these are the sources of wealth.

Wealth, in turn, can reshape the enterprise's horizons:

longer R&D cycles (no short-term profit pressure)

better teams (attracting outside experts)

more strategic room (no anxiety about the next funding round)

stronger resilience to risk (riding out cycles on cash reserves)

Wealth with a sense of direction is an amplifier for the enterprise.

3. Wealth ⇄ People

Wealth nourishes people, and people also decide the future form of wealth.

The benefits of wealth to people are obvious:

it provides educational resources, room for trial and error, an international outlook and a cushion against risk; it lets the family's descendants not have to suppress their curiosity for the sake of survival, and gives young people the courage to try, to fail and to start again.

But in turn, people also decide the form wealth takes. Whether wealth is resented or respected depends entirely on how people use it:

people with strong values turn capital into philanthropy and reputation;

wise people steer capital into the right industries and assets;

responsible people make capital a virtuous cycle for society rather than a source of strife within the family.

Wealth gives people more possibilities; people decide whether wealth is good or evil.

The strong make wealth a blessing; the weak make wealth a curse.

My ideal of family succession

A truly mature family doesn't cling to any gain or loss of a particular time and place, and doesn't use "family succession" to constrain people — instead it completes the perfect cycle of the FST model:

1. Converting forms

When it's time to turn the spark into an enterprise, don't hesitate;

when it's time to turn the enterprise into wealth, decide calmly;

when it's time to turn wealth into education, philanthropy and reputation, spare no investment.

Energy never solidifies and never disappears; it only changes form.

2. Adjusting the rhythm

In different economic cycles, life stages and historical contexts,

the weights of people, enterprise and wealth can shift dynamically;

the center of gravity can move, but the cycle must not stop.

3. Continuing across generations

When the next generation understands the systemic logic of succession,

rather than inheriting static assets,

the family gains true sustainability.

What is passed on isn't a pile of assets,

but a system that keeps renewing and repairing itself.

Let's come back to the human scale

Is succession necessary? First there has to be consensus — one generation has to be willing to "pass it on," and the next has to be ready to "take it up"

Succession isn't a one-way action; it's a joint project between two generations.

The older generation has to be willing to let go, willing to express themselves, willing to embrace uncertainty

The younger generation has to be willing to take responsibility, willing to grow, willing to find their own place

What matters most in between isn't how much wealth there is, but one word:

consensus.

Consensus matters more than structure,

understanding matters more than plans,

relationships matter more than assets.

However the tools change,

whether a family can endure ultimately depends on:

whether its people are growing

whether they have a sense of their place

whether they keep believing in each other

whether they are willing to create together

whether they are willing to take on greater responsibility

Finally, I hope that through "thinking about succession"

we can see ourselves:

where you come from, where you're going, and what you're willing to hold on to.

The future of this series

Going forward I will discuss further:

1. Why people are a family's most essential asset

2. Defining family members

3. Family governance: the secret to a family's longevity.

4. The four quadrants of the family–business relationship.

5. Succession on different time scales: 10 years, 50 years, 100 years...

6. Cultural differences in family succession: comparing succession in Japan, the UK and China

7. A family's tangible and intangible assets

8. Asset management of family wealth: strategy and practice.

9. The next step for wealth: from rich to noble.

10. Exploring your own succession strategy: the attributes of different families.

and so on

Anyway, here's the first piece — out it goes! Yeah~