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Michael Otto, 59, has aggressively pushed to countries beyond Germany, including the U.S., where he has a majority stake in Crate & Barrel. (The family separately owns the Spiegel catalog group, which includes Spiegel, Eddie Bauer and Newport News, an online women's-clothing retailer.) Otto has also invested heavily in technology, including e-commerce, to improve efficiency, cut costs and reach out to customers. Last year the company turned a profit for the first time on its online sales, which reached $1.9 billion. Otto boasts that it's the second largest Internet retailer after Amazon.com The advantages of running a closely held family company are that "I can always think long term and not have to look at short-term profits," he says. That means he can make big investments in technology, including e-commerce, without feeling pressure from stock analysts and investors.
It also means he can follow his environmental convictions, even if that weighs on earnings temporarily. For example, the company has stopped selling products made of tropical wood and has undertaken a comprehensive--and costly--effort to ensure that many of the garments it sells are made of organically grown cotton (only natural fertilizers are used) or other environmentally correct materials. "I found it important to do this," Otto says, and since the family owns 85% of the company, there's nothing to stop him.
Lagardere LAGARDERE GROUP
From his roots in aircraft design, founder Jean-Luc expanded into magazine publishing. Today son Arnaud leads the charge into book publishing by the publicly traded PARIS-based holding company
Family's Stake: $250 million
Jean-Luc Lagardere trained as an engineer at Marcel Dassault's aircraft-design business in the 1950s and went on to run a small Dassault subcontractor called Matra. In 1980 he diversified into media by acquiring magazine group Hachette and today publishes 222 titles, including Paris Match, Car and Driver and Elle. A foray into TV almost bankrupted Matra, but it recovered, and the publicly traded firm--now called Lagardere Group--with $14 billion in annual sales is weathering the economic downturn. Through aggressive dealmaking, he has spun his stake in Matra into a 15% share of EADS, which makes Airbus jets. His son Arnaud, 41, is leading the growth of Lagardere's media division, with about $8 billion in annual sales. Last October Arnaud agreed to acquire the book-publishing arm of ailing Vivendi Universal for $1.25 billion--giving Lagardere an estimated 70% of the French book market. In a strange twist, a shadowy Swiss-based firm with links to Iraq and possibly Saddam Hussein owns about 2% of Lagardere's shares, but the holdings were frozen in 1991.
Baer JULIUS BAER GROUP
A model for the way a multitude of heirs can preserve a complex business, this ZURICH banking family pools its power (the stock is publicly traded) and then allocates duties with care
Family's Stake: $227 million