The Strategic Horizon · What no government can confiscate.

Bacardí, the Rothschilds and the Wallenbergs show what survives when a business family loses almost everything.

On 14 October 1960, Cuba’s revolutionary government took everything two of the island’s great rum families owned there: distilleries, warehouses, offices, bank accounts. The Bacardís and the Arechabalas lost the same things, under the same law, within a day of each other.

What followed could hardly have been more different. The Arechabalas left Cuba and stopped making rum. Decades later, their descendants sold the rights to their brand, Havana Club, to a buyer who understood exactly what it was acquiring: Bacardí.

Some years earlier, Bacardí had done something rather unglamorous. Uneasy about the instability of the Batista regime, the company had moved ownership of its trademarks, its formulas and its yeast out of Cuba, and was already producing in Puerto Rico and Mexico. When the confiscation came, the Cuban state kept the buildings. The family left with whatever it was that made Bacardí Bacardí.

One detail strikes me as more instructive than the outcome. They protected their intangible assets against the wrong threat. They got the forecast wrong and the discipline right.

Every business family holds two kinds of wealth. The first can be confiscated: physical assets, licences, accounts, shareholdings recorded in a registry that answers to a state. The second cannot. It consists of the name and what it stands for, the trust of those who do business with the family, its relationships, the judgement accumulated over generations and, above all, the family’s capacity to decide together when things go wrong.

My thesis is simple and, I suspect, rarely examined. When a family business becomes a family group, the strategic question changes. It is no longer enough to know what we own. We need to know what would be left if what we own were taken away, and which of us would know how to govern it.

For three decades, many families could treat political risk as a footnote in the annual report. Globalisation offered reasonably stable rules and a fair degree of confidence that private property would be respected almost everywhere. That era is over. Tariffs are once again instruments of diplomacy, sanctions and export controls are part of the landscape, and governments have rediscovered the habit of deciding which industries are strategic and who may own them. In Latin America, expropriation was never an academic hypothesis.

Let us change region and scene. Few families have learnt this distinction as harshly as the Rothschilds, and almost always by losing something.

In 1981, France’s new government nationalised thirty-nine banks. One of them was Banque Rothschild, founded in Paris in the nineteenth century. Guy de Rothschild, who had run it since the post-war years, left for New York. His son David chose to start again with around ten employees, but the government would not allow him to use the family name. The bank had to be called Paris Orléans, after the old railway company the family used as a holding vehicle. Only in 1986 did they recover the right to their own name.

The French state went so far as to confiscate a surname, which is about as close to a pure intangible as one can get. During those years, what sustained the rebuilding was not the name on the door, because there was none. It was what that name had meant, for a century and a half, to those who knew it. A government can ban a name. It cannot ban what people remember about it. Today Rothschild & Co once again brings the English and French houses together.

The same family offers two further lessons that complete the first.

The Naples house, founded in 1821, became the dominant bank in the kingdom. Its advantage was proximity to a particular sovereign. When Italian unification diminished Naples, the house lost its reason to exist and closed in 1863. A privileged relationship with power is an intangible asset, but one with a peculiarity worth remembering in Latin America and well beyond it: half of that asset belongs to whoever happens to be in government.

The Frankfurt house, where it had all begun, closed for a more intimate reason. In his will of 1812, Mayer Amschel Rothschild stipulated that his daughters, his sons-in-law and their heirs would have no share in the business, which was to belong to his sons alone. It was a rule designed for cohesion, and for decades it worked. In 1901 the last Frankfurt partner died without a male heir, and the family voluntarily wound up the founding house. In fairness, Frankfurt was no longer a major financial centre, so the rule was not the only cause. But it did rule out considering anyone else. The rule that protected the first generation’s cohesion ended up closing the house where the family was born.

The Wallenbergs of Sweden show the other side. In 1916 a new law barred banks from holding industrial stakes, a direct threat to a family whose model rested on its control of the bank SEB. Their response was to move those holdings into a new company, Investor AB. Over time, ownership passed to a set of family foundations that today control the majority of Investor’s votes. The fifth generation leads it; the sixth is beginning to join the boards.

A law meant to constrain banks produced the architecture that has sustained a family for more than a century. Their motto, Esse, non videri (to be, not to seem), says a great deal about how they understand the wealth that matters.

The strongest objection to all this is survivorship bias. We study the Bacardís, the Rothschilds and the Wallenbergs because they survived. Many families with equal reputations and better connections disappeared, and nobody writes about them. One could also argue that what saved Bacardí was not a family virtue but sound legal structuring: trademarks registered abroad in time.

I accept both points, and that is precisely why the distinction matters. Structures protect the ownership of intangible assets. They do not create their substance. A trademark moved to another jurisdiction is worth something only if there is something behind it that people recognise, a family able to agree on rebuilding, and a generation prepared to do it. The Arechabalas had a trademark too. They ended up selling it.

I have seen many family boards where the wealth that can be confiscated has an auditor, a lawyer, a manager and a committee. The other kind rarely has anyone responsible for it. Nobody measures the trust the group depends on, nobody checks whether a relationship with a government has turned into a dependency, and nobody asks whether the cohesion rules that worked thirty years ago still protect the family or have begun to confine it.

The question I would put to the board of any family group is uncomfortable and concrete: if we lost the assets we hold in this country tomorrow, what would we rebuild with, and which of us would know how?

There is another lesson in these stories that tends to go unnoticed. No government managed to destroy the wealth these families held beyond its reach. When a house was lost, it was because of an internal rule or a bet placed entirely on a single sovereign. A government can confiscate a family’s assets. Its trust can only be lost by the family itself.

This week in Santo Domingo, at the Latin American Family Business Summit 2026, I argued before business families that we do not inherit companies; we hold them in trust. The history of those who lost almost everything adds a nuance worth keeping in mind: what we truly hold in trust is whatever no one can take from us. No structure protects that. Each generation either keeps it or loses it.

How much of your family’s wealth would survive a confiscation? And how much would survive the next time its owners stop speaking to each other?