The first thirty-five years of CEE capitalism were about creating wealth. The next thirty-five will reveal whether we can perpetuate it.
Central and Eastern Europe has spent three and a half decades learning capitalism. The next challenge may be learning dynasty. I use the word carefully. CEE does not need oligarchies, nor the fusion of political and economic power that has occasionally accompanied post-communist capitalism. What it increasingly needs are owners capable of thinking beyond the founder, beyond the next quarterly result and, eventually, beyond the original company.
This distinction matters because the region is approaching one of the least discussed turning points in its post-1989 economic history. The entrepreneurs who built CEE’s first generation of substantial private companies are getting older, and much of the wealth they created has never faced a succession. According to PwC, 64 per cent of the region’s family businesses remain controlled by the first generation, double the 32 per cent global figure. In other words, CEE has accumulated private capital, but has not yet demonstrated that it can institutionalise private capital across generations. That is a different skill from entrepreneurship. And it is a skill an apparently unlikely northern neighbour has been practising for roughly 170 years.
From transition capitalism to family capitalism
The economic history of post-communist Central and Eastern Europe can be read as a sequence of overlapping models. First came entrepreneurial capitalism, with founders exploiting enormous gaps in markets suddenly liberated from central planning. Then privatisation capitalism, sometimes efficient, sometimes controversial. Foreign investment capitalism followed, as Western European, American and Asian companies brought capital, technology and management into the region. EU accession accelerated convergence capitalism: CEE embedded itself deeply in European supply chains, particularly German industrial ones, while European funds and access to the Single Market raised productivity and living standards sharply. More recently we have seen the beginnings of indigenous multinational capitalism, with Polish, Czech, Romanian and other regional companies investing beyond their home markets.
All of these models have helped make CEE dramatically richer. But something is still missing. Much of the region’s indigenous private capital remains attached to the generation that created it. The next transition, therefore, may not be from communism to capitalism, or even from emerging to developed economy. It may be from founder capitalism to institutional family capitalism.
I have spent several years studying what I call global ‘Superclans’: large business families and the structures through which they preserve, deploy and reinvent capital. One conclusion recurs. Creating wealth and perpetuating wealth are surprisingly different disciplines. The founder concentrates. Inheritance naturally fragments. The founder possesses authority almost automatically; the second generation has to construct it. The founder knows why the company exists, because he or she created it; the third generation has to be taught why maintaining it matters.
This is what I have elsewhere called the entropy of capital. Without institutional counterweights, ownership fragments, objectives diverge, and the entrepreneurial intensity that created a fortune gradually dissipates. CEE is now approaching its first major encounter with this problem.
CEE has already produced the raw material
There should be no inferiority complex here. The region has created remarkable companies and fortunes in little more than one generation. Poland has developed substantial family-controlled businesses across retail, manufacturing, pharmaceuticals, furniture, food, technology and distribution. Czechia’s landscape now includes rapidly internationalising industrial and technological groups such as the Strnad family’s Czechoslovak Group in defence, alongside the families behind Kofola, JUTA and Průša Research. Hungary has produced internationally active family-controlled industrial businesses.
Romania has its own powerful examples. The Pavăl brothers transformed Dedeman from a local venture into the country’s dominant DIY business, today 64 stores and more than 13,500 employees, and then created Pavăl Holding, a diversified investment platform spanning real estate, private equity, agriculture, industry and energy. Its acquisition of Praktiker Hellas in Greece, its first move beyond Romania and financed entirely from its own equity, represents something psychologically important for Romanian capital: the transition from defending a successful domestic position to owning assets abroad. From Transavia to entrepreneurial groups across manufacturing, logistics, agriculture and services, other Romanian families are confronting variations of the same question.
What happens after the founder?
In Poland, PwC already describes an evolution from the family business to the business family, from a family owning one operating company toward a family managing a broader ecosystem of businesses and investments. That distinction may sound semantic. It is potentially the beginning of CEE’s next capitalism.
So, enter the Wallenbergs. If there is a landmark case of European family capitalism, it is difficult to avoid the Wallenberg family. The story begins in 1856, when André Oscar Wallenberg founded Stockholms Enskilda Bank, today SEB. But what makes the family relevant is not its age. It is the architecture built around that longevity.
Over successive generations, the Wallenberg sphere became associated with some of Sweden’s most important international companies. Investor AB’s portfolio today includes major holdings in ABB, AstraZeneca, Atlas Copco, Ericsson, Saab and SEB, alongside private investments and exposure to EQT. Yet the model is not simply ‘a rich family owns many companies’. That would be an uninteresting lesson. Its significance lies in the institutional arrangement connecting family stewardship, professional management, active ownership, capital allocation, science and national development.
Investor AB is publicly listed. The Wallenberg Foundations are its anchor owner. Their economic ownership and voting influence are structured so that long-term control can coexist with external shareholders and professional corporate governance. In 2025, Investor paid roughly SEK 3.7 billion (around 334 million euros) of its dividend to the Foundations, part of an ecosystem whose combined foundation assets reached around SEK 370 billion by year-end.
And then something particularly interesting happens. Capital returns to society in a way that strengthens the ecosystem from which future companies emerge. The Wallenberg Foundations fund research and education, mainly in medicine, technology, the natural sciences, data, materials science, artificial intelligence and quantum technology. They have awarded close to SEK 50 billion in grants since 1917, and a record SEK 3.1 billion in 2025 alone.
The cycle looks approximately like this. Ownership creates companies; companies create dividends; dividends finance research; research strengthens national capabilities; stronger capabilities create the conditions for the next generation of companies. The most telling design detail is the ratio: at least 80 per cent of the dividends flow to research and education, and the remaining share is reinvested to compound the engine itself. This is philanthropy. But it is also ecosystem construction.
The real Wallenberg innovation is institutional
Families often obsess over who will inherit. The Wallenberg system asks a more sophisticated question: what exactly should be inherited? Money? Shares? A chief executive’s chair? Or responsibility for an institution?
The distinction is fundamental. The Wallenberg model progressively separated the family’s economic role from the idea that every descendant must personally own and operate pieces of an inheritance. Foundations became long-term owners. Investment vehicles became professional capital allocators. Operating companies developed their own executives and boards. Family influence remained, but family membership did not automatically mean operational management.
That is perhaps the most important lesson for CEE. Successful succession does not necessarily mean replacing Founder Senior with Founder Junior. Sometimes it means transforming the family from managers of a company into stewards of capital. The current succession illustrates the point. As the fifth generation prepares the sixth, younger family members are given rotating observer and board roles rather than being crowned heirs. They gain exposure to the family’s different institutions and are expected to develop competence before authority. Succession is treated less like a coronation and more like executive development. For a region in which many founders still personify their companies, this is a radical idea.
Wallenberg is not the only European dynasty
Europe offers other versions of durable family capitalism. The Agnelli family transformed its historic relationship with Fiat into a diversified ownership structure centred on Exor, whose investments extend well beyond automobiles. Germany’s Quandt family remains closely associated with BMW. The Peugeot family has repeatedly adapted its ownership structures while retaining an influential role in European industry. And family-controlled Mittelstand businesses across Germany, Italy and Switzerland demonstrate another model altogether: concentrated ownership combined with deep technological specialisation and patient investment.
The structures differ. The recurring insight is the same. Durability comes when the family institutionalises itself before circumstances force it to. That is the lesson CEE should study. Not the surnames. The architecture.
What would a Wallenberg 2.0 look like in CEE?
It would not be a copy. Sweden’s institutions, capital markets, social model and industrial history cannot be reproduced in Warsaw, Prague, Bucharest or Budapest, nor should a twenty-first-century business family try to recreate structures designed for nineteenth- and twentieth-century Swedish industrialisation. A CEE version would need to be younger, more international and probably more entrepreneurial. But several Wallenberg principles travel extremely well, and together they form the architecture of enduring family capital.
The first is to separate family, ownership, and management. The founder can simultaneously be owner, chief executive, strategist, chief salesperson and final court of appeal. The third generation cannot. CEE families need constitutions, family councils, shareholder agreements, professional boards and explicit rules governing who may enter the business and on what terms. The surname should provide an opportunity to serve, not an entitlement to command.
Next comes the need to turn the operating company into an ownership platform. The first generation builds a company; the second should consider building an institution capable of owning companies. This is already beginning in CEE through holding structures, family offices and foundations. It matters because a family whose entire fortune remains concentrated in the founder’s original company carries enormous sectoral and succession risk. A holding structure can allocate capital across industries, geographies and generations while maintaining a coherent ownership philosophy. The objective should shift from ‘protect father’s company’ to ‘compound the family’s productive capital’.
Equally important is to professionalise before succession, not during the crisis. One of the worst moments to invent governance is when the founder becomes ill, family members disagree or liquidity is suddenly required. Professional managers, independent directors and transparent reporting should arrive while the founder is still strong enough to design the system. This demands something psychologically difficult for successful entrepreneurs: voluntarily giving up some control in order to preserve influence over the long term.
Heirs, meanwhile, should be educated as owners. Next-generation education is not simply an MBA. Future owners need to understand capital allocation, governance, geopolitics, technology, reputation and the responsibilities attached to concentrated wealth. They should ideally work outside the family business, sit on boards before chairing them, and learn to evaluate executives before becoming executives. And some should be free to decide that their highest contribution to the family is not working in the business at all. The Wallenberg practice of rotating younger members through observer and governance roles deserves particular attention here.
A bridge should be built between wealth and knowledge. Here CEE can improve on the model rather than merely imitate it. Imagine the region’s largest business families systematically endowing research programmes in artificial intelligence, biotechnology, defence technology, energy, advanced manufacturing and agricultural science. Imagine family foundations funding laboratories at Warsaw, Prague, Brno, Budapest, Bucharest, Cluj, Tartu or Ljubljana while family investment vehicles help commercialise the resulting intellectual property. CEE complains, with justification, about brain drain. Family capital could become part of the answer. The region does not only need more philanthropy; it needs strategic philanthropy linked to capability formation.
Family business also need to become international owners, not merely exporters. CEE’s first internationalisation was largely about selling abroad. Its second should be about owning abroad. Acquisitions give families distribution, brands, technology, talent and market access that organic expansion may take decades to build. For the next generation of CEE business families, the relevant map should extend well beyond Vienna, Munich and London, to New York, Dubai, Singapore, São Paulo and increasingly the emerging markets where the next decades of global growth will occur.
Finally, conspicuous wealth should be replaced with institutional reputation. The Wallenberg motto is Esse, non videri, to be, rather than to seem. There is something particularly useful in this for post-transition societies, where rapid wealth creation can generate suspicion. The strongest legitimacy for family capitalism comes not from displaying wealth but from demonstrating stewardship: building companies, employing people, financing science, supporting communities, representing the country internationally, and behaving as though the family will still be accountable for its reputation fifty years from now. Because that is precisely the point.
The next CEE transition
PwC’s research captures the urgency. Only about half of CEE next-generation respondents report awareness of a succession plan, while 41 per cent say their family business has none at all. This is more than a private family matter. In parts of the region, family businesses employ a very large share of the private-sector workforce, and in Czechia they are estimated to make up 70 to 80 per cent of all companies. Their succession therefore carries macroeconomic consequences.
If the first post-communist generation sells indiscriminately, fragments ownership or fails to prepare successors, CEE risks transferring another layer of indigenous economic control elsewhere, just as the region reaches developed-economy status. There is nothing inherently wrong with selling a company; in many circumstances it is the rational choice. But a region in which almost every successful founder eventually sells to foreign strategic investors or private equity will remain different from a region capable of producing permanent pools of domestic patient capital.
This is the deeper Wallenberg lesson. Sweden did not become wealthy because it had the Wallenbergs. But the ability of Swedish capitalism to create long-duration owners who backed internationally competitive companies, professional management and domestic research became part of the country’s institutional economic fabric. CEE now has the wealth required to begin constructing its own version.
From successful founders to successful ancestors
In my work on global family businesses and Superclans, I have become convinced that succession is badly described by the language of inheritance. Inheritance asks: what will my children receive? Stewardship asks: what will still exist because my grandchildren received it? Those are very different questions.
The first generation of CEE entrepreneurs has already achieved something extraordinary. Starting in economies with little private capital, immature financial markets and enormous institutional uncertainty, they built companies worth hundreds of millions and, in some cases, billions. They became successful founders. The challenge now is harder. To become successful ancestors.
A Wallenberg 2.0 will probably not be one family, nor should it be. It could instead be a generation of Polish, Czech, Romanian, Hungarian, Slovak, Baltic, Slovenian, Croatian and other CEE families that learn to turn entrepreneurial fortunes into professionally governed, internationally invested and socially legitimate institutions of patient capital.
The first thirty-five years of CEE capitalism were about creating wealth. The next thirty-five will reveal whether we can perpetuate it. And that may prove to be one of the final transitions from emerging Europe to emerged Europe.
Photo: Dreamstime.