Canadian Business Magazine recently published the list of Canada’s 100 Wealthiest People (2010/11). I analyzed the list to see which sectors are producing wealth for these people.
Many of them obviously have holdings in more than one sector so I used some judgment to come up with my breakdown by sector but the over all trend is clear: three sectors (real estate, tech and food/retail) produced the most billionaires/centi-millionaires, accounting for nearly two thirds.
Here are my findings:
Real Estate and Construction 25
Tech, Media and Entertainment 22
Food and Retail 19
Transportation and Manufacturing 6
Energy and Resources 14
Source: Canadian Business: 2010/11
There is no guarantee that the same three sectors that produced two thirds of Canada’s wealthiest people over the last two generations will do so over the next two but that seems likely. As someone with experience in real estate, I think this industry will continue to dominate for reasons that I set out earlier: Why Real Estate is a Unique Asset Class (http://www.eqjournalblog.com/?p=1350) but it wouldn’t surprise me to find out, 50 years from now, that either tech/media/entertainment or food and retail had edged it out for top spot.
I have seen a large increase in interest in food and food production, especially locally grown organics. Land values for farmland are also increasing as a result. It will be an interesting horse race amongst the top three. The key thing for entrepreneurs is to locate their startups in fields in which all boats are rising– then even BUSINESS MODELS FOR DUMMIES can succeed.
Comment from @PhilCulhane: @ProfBruce, Isn’t the best sector, the one you’re most passionate about?
Answer: Well, you could be passionate about horses & buggies but that might not be the best biz to go into. I generally find that entrepreneurs lose their passion for something quite quickly if it doesn’t make a profit or, at least, look like it will get there at some point. (Ed.)