Sometimes you have to look back and understand how you arrived at a place before you can feel confident about where you’re heading. This month’s featured article is our effort to do that. For us, this deep dive into the idea of digital sovereignty started with a few questions. How did we all become so dependent on subscription-based software that we don’t even actually own? And when did it become OK to put our company’s private financial records and other important information on digital platforms we’re just renting? It seems a little weird. And the increasing expense of these rentals is worse than weird.
The latest research (details and sources cited in the article) says businesses now spend an average of nearly $5,000 per employee per year on software subscriptions. So for a 100-employee, middle-market company, that translates to nearly half a million dollars annually, most often drawn from core operating capital.
Is there a better way? We believe there is.
Digital Sovereignty: What Took Us So Long?
Why many middle-market family enterprises don’t own their own information, and how a changing digital landscape will pave the way for owners to own again.
Teachers teach, nurses nurse, ballers ball, owners own and losers lose — except when things go sideways. And when that happens, sometimes owners fail to own. Instead, owners lose. In fact, for the better part of this century, we’ve failed to hang onto our own information. This information migration started in the early 2000s, accelerating from about 2010 to 2015. We lost ownership of information, a foundational piece of any family enterprise.
Or — one might argue — we gave it away.
But it’s OK because you already know what many of us watched happen. In that era, information shed its old skin and stepped into something different. It wasn’t the same, use it and manipulate it effectively and efficiently, it became part of an intangible hyperreality like other abstract things: email, online transaction, a Facebook page.
In some ways, information was unrecognizable in its new form, so it wasn’t classified as a thing to own in the same way it once was. It’s sort of like when your little one is just beginning to eat real food and falls madly in love with mashed potatoes, only to emphatically reject the same food — potatoes — in the form of a hashbrown.
To the toddler’s untrained eye, hashbrowns look so unlike the mashed version of potatoes; they aren’t potatoes at all. And to the untrained analog eyes accustomed to information captured on printed documents or legal pads, digital information housed on subscription-based online platforms wasn’t information at all.
When Information Changed Its Skin
There was, however, a transition period from print to digital, when owners relied on disks with the software they’d purchase, own and install on computer hard drives, or in some cases, internal servers they also owned, otherwise known as the Software as a Product (SaaP) era, which dominated the 1980s and 1990s.
But with the emergence of Software as a Service (SaaS), digital information became as abstract as the stars in the heavens: Both gave off light; both were out of reach. One, the stars, are trillions of miles away. The other, our information, was backlit and untouchable, housed on servers on someone else’s infrastructure. SaaS improved reliability and scalability, but it also separated access from custody. Information was still produced by the owner, but it was no longer physically or operationally under the owner’s direct control.
The emergence of AI is going to change all of that. In many ways, it already has. In fact, the dawn of AI is moving so rapidly into our everyday lives that it’s hard to say when to classify its effects as past tense or present tense. We’re in the midst of a real-time implosion of change that’s conflating the “somewhere in the near future,” with the “right now.”
All of AI’s sweeping side effects are unknown and likely will be until humanity has the benefit of hindsight. But for now, we believe we’re entering the era of digital sovereignty. In 2026, our company — i3 Global Enterprises — is wrangling up what’s been roaming free. And we’re doing it for a whole host of reasons we’re about to unpack and examine.
The Big Read by Family Matter
About Family Matter: ”Family Matter“ is a content series by Kevin Heaton, founder and principal of i3 Global Enterprises, a private asset management and family CFO office. Newsletters and emails like “The Big Read” feature the latest content from Kevin and select posts from i3resources.com, our company’s website.
About i3: i3 helps families in business navigate the unique financial challenges and interpersonal conflicts that threaten long-term wealth preservation and growth. Our families reach positive outcomes through nuanced i3 processes and operational systems that align four core pillars: succession planning and family governance, wealth analysis and reporting, financial infrastructure and forecasting and private asset management (if needed). By creating durable systems within a financial ecosystem that’s tailored to each family’s needs, i3 Global helps families in business foster financial and relational harmony and grow wealth over generations. To learn more about i3 Global Enterprises, visit i3resources.com. Or contact us here.