Lauren Cohen has taught at Harvard Business School since 2007, two years after earning his Ph.D. and an MBA from the University of Chicago. The finance professor and 2017 Poets&Quants 40-Under-40 selection is now the L.E. Simmons professor in the Finance & Entrepreneurial Management units at Harvard, teaching in the MBA program, Executive Education program, doctoral program, and special custom programs. He is also, notably, an accomplished weightlifter.
Among his other achievements at Harvard, Cohen is the faculty co-chair and designer of the HBS Executive Education course Building a Legacy: Family Office Wealth Management, from which his new course for MBAs, How to Not Bankrupt Your Family, grew. The latter course promises to “give students a toolbox for how to begin a manage a family office from both the family and the family office managers’ perspectives throughout the office’s lifecycle.” It was designed, Cohen says, around an old saw about the vicissitudes of fortune.
“I started the family office program here and essentially in every language, there’s some saying, which is equivalent to, ‘From rags to riches and riches to rags in three generations,'” he tells Poets&Quants. “As quickly as you can amass this fortune, you can lose it so much more quickly. And there are these phenomenal tales in every culture, in every society, of exactly those train wrecks happening. They often play out in real time in the public forum, and so we have these examples that we motivate with.”
LEARNING ‘ALL ASPECTS OF HOW TO HELP A FAMILY OFFICE THRIVE’
One of the best examples of squandered family wealth is the Vanderbilt family. Cohen recounts that when he was 16, Cornelius Vanderbilt borrowed a hundred dollars from his mother and invested in a single boat. “He turned that into lots of boats and from lots of boats, he went to the railroad and then he went on to build what at the time was the largest fortune in the U.S.,” Cohen says. “It represented 50% of the value of the total U.S. treasury — 50% of the value of the treasury this one person had!
“Within 30 years of that, essentially they had almost taken all of that wealth and dispersed it to a point where there was almost none left. Within 50 years it was gone completely. And a 120 years later, when they met at Vanderbilt University named after him, none of the family had more than a million dollars.” Still, he adds, some Vanderbilts are famous today, including CNN anchor Anderson Cooper and actor Timothy Olyphant.
Cohen’s course takes students from the opening of a family office through investments and governance and on to the final days, introducing them “to all aspects of how to help a family office thrive. Students will meet many case protagonists and discuss family office issues firsthand with those with deep experience in the space,” the syllabus reads.
FAMILY BUSINESS: GLOBAL PLAYERS IN THE ASSET MANAGEMENT SPACE
The seed for Cohen’s new course was planted about seven years ago, he says, when he was teaching a course called Investment Managers Workshop. “It was the usual suspects in this course, VCs, mutual fund managers, hedge fund managers, sovereign wealths, and we start to get a couple family offices, and then a few more and some of them are really well run and some of them were not nearly as well run.”
Cohen wanted to address the terrible unevenness among family businesses: “I wanted to help,” he says. “And so that’s when I built the Executive Education program. So I’ve been running the Executive Education program on this for the last probably four years, and I’ve had more and more MBA students start to come to me and say, ‘Look, we would love an MBA course on this.'”
Then he noticed that Harvard students were starting to turn down offers at top private equity firms in favor of family offices. The appeal, he says, is that “they get to, from day one, essentially be the captain of the pirate ship instead of having an increasing glass ceiling in these places because there are more and more layers above them at these private equity firms.”
But Cohen also saw an increase in students from families that are starting family offices, and those who think they might want to start one in the future. “The truth of the matter is, these families are becoming more important to players in all the areas,” he says. That includes internationally: He met with a delegation from Singapore interested in attracting more family offices to compete with Hong Kong.
“And so there’s global competition for them,” Cohen says. “They’re partnering with governments on philanthropic efforts and other investments. In the asset space, they’re becoming more important sources of assets. They’re competing with private equity firms and winning. So whether you’re going into them or not, you’re going to deal with them in some ways. It is interesting it will become increasingly interesting in the whole asset management space.”
See pages 4-6 for complete lists of the new courses at the top 26 U.S. B-schools, including instructors and disciplines. Some courses are highlighted with descriptions provided by the school.
AND DON’T MISS ALL THE NEW FACULTY AT THE TOP U.S. B-SCHOOLS IN 2022 and LAST YEAR’S STORY ON THE NEW COURSES AT THE LEADING U.S. SCHOOLS
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