Your family blood may be thicker than water but is it good for business?
As Icarus discovered to his cost when he dismissed his father’s advice, your family are often your best critics and your closest ally in business.
And while many family-run businesses have not just thrived over the decades, but become multinational behemoths – I’m thinking the Fords, the Tatas and the Saatchis – many others have produced nothing more than awkward family picnics, hours of counselling or overblown invoices from the divorce attorney.
Going into business with your family or relatives is risky, well, business. You may lose their money, your trust may prevent you from drafting the necessary legal safeguards and problems at work will linger over you all the more on weekends and holidays.
But I maintain that the best-run businesses are family businesses where the team recognise their differences but value their strengths and appreciate the legacy they will pass on to the next generation. If the thought of working alongside your family terrifies you, then I’m afraid you need to address the weak ties and interpersonal tensions that cloud the dinner table, because businesses run by strong families have the DNA to thrive.
Recent statistics have shown that in the US, the 5.5m family-owned businesses make up 57 per cent of the country’s GDP, employ two-thirds of US’s workforce and create almost 80 per cent of all new jobs.
Running a family business also offers a number of distinct advantages that you don’t get with a more dispersed ownership structure. For example, your family will provide you with longer-term commitment and focus, they won’t hold back when it comes to scrutinising your failures and they’ll certainly be more cautious about the debt you take on!
It’s not worth pretending that there aren’t pitfalls, but diligent preparation, a shared vision and of course a strong foundation will help you, your loved-ones and the business take flight and avoid getting too close to the sun.
Finally, if going into business with your family is more akin to setting up shop with Uncle Fester and Homer Simpson, transform your team into a big family team that shares your values and watch them make a difference.