Family businesses are by no means a thing of the past. No way. Not only are they some of the longest-lasting businesses in the game, family members joining forces – kind of like an entrepreneurial Megazord – also make up a huge chunk of startups each and every year. It kind of makes sense too.
It doesn’t matter whether you are brothers, sisters, spouses, parents, children, great aunt and great nephew, or whatever other combination you can think of, being a business with family just makes sense. However, it also makes zero sense, too, and that is something you have to watch out for.
Yes, you may know each other’s strengths and weaknesses, but you will probably know how to push each other’s buttons too, which isn’t ideal (#Oasis). Yeah, starting a business with a family member tends to present a more than its fair share of unique problems… sorry… we meant challenges, and that’s on top of the other problems that face start-up companies (spoiler alert: there tend to be a lot).
Basically, there is a balancing act to consider when going down the route of launching a family business. That’s why we have spent as much time as we can talk with those that have gone and done it and asked them to reflect on the trials and tribulations so that we can come up with a list of essential lessons to take on board and consider.
And here they are. Enjoy.
No Talking Shop Outside Your Shop
You are family. There is no escaping that. It is one of the big reasons you decided to launch whatever it is you are launching in the first place. What that inherently means, though, is that you have already blurred a giant line that keeps a lot of working people sane, and that is the divide between your work life and home life. You need to recognize that fact and drill into your heads. The line has been blurred.
That means you are going to be a tad more tempted to talk shop when you are not in the shop. In fact, you’ll likely start talking business 24.7. It will become your main focus of conversation, and that is unhealthy. Actually, it is way more than that; it is potentially more volatile than a volcano that has been simmering for a decade.
That’s why you need to lay down some rules about when you talk shop. Don’t worry, we haven’t got our heads in the clouds, we know this is easier said than done. But try and limit it, and certainly don’t have any business chats when at a big family do, or at a wedding, or a funeral or anything like that. That should be a rule. Another good idea is to have the back of your office door painted with a reminder, “No Talking Shop Outside The Shop.” It’ll be the last thing you see each day.
Schedule A Weekly Meeting And Never Miss It
Problems are going to arise. They arise in any business, but what tends to keep them under wraps in a traditional office environment is business courtesy; you don’t piss off you colleagues. That unwritten rule tends to fly out of the window when it is a family member, though, because, well, they’re family. Differences of opinion get voiced, and often without the chance to take a breath and think about the consequences.
As such, we recommend you agree on a day and time, each week, to have a meeting and discuss all things business; a schedule to stick to. The people we spoke said that the best time for this is Monday at 10 am, which then allows you to focus your energy on the week ahead, get on the same page and know what your goals are. It could progress that you discuss. It could be finances. It could be expansion or problems, disputes or the fact you want to have a vending machine in the lobby, one that sells Skittles because you love Skittles. Whatever. Just have the meeting and never miss it. Never. Say it out loud. I promise to never miss this meeting.
With Great Responsibility Should Come Great Clarity
The thing with families is, well, they bicker. That’s why it is best to avoid this as best as possible by making sure everyone knows exactly what their role is and exactly what responsibilities they entail. The more detail the better, and the less cross over too. Seriously. The more detail the better. It could be that someone’s role is securing new business, in which they have the sole responsibility of attending that trade show next week. It could be that someone has the role of improving the company’s workflow and efficiency, in which it is their responsibility to visit DataServ today. It could be that someone has the role of ensuring all new employees complete a compliance training module, in which case it is their responsibility to speak to digital learning providers like BYG Solutions.
The reason for this level of detail, and this divvying up jobs, is that it avoids conflict. That’s gonna be a pretty mega bonus. Why? Well, some family members may have the same qualifications, of the same level of experience, or type of experience, in which case there is room for crossover and room for argument. So avoid it. That doesn’t mean you can’t make the big decisions together, it just means you won’t be bickering over all of the little things too; the things that can really hold up a company’s progress.
The Written Word Should Not Be Underestimated
There is a lot to think about when it comes to starting a company. Where you are going to launch, where you are going to get the funding, what the name will be, how you want the website to look, who you are going to employ, what social media strategy you are going to use, will they be integrated with traditional advertising methods, and one trillion other things. As such, a lot of people forget to draw up a plan, one that carefully details what each party is going to get out of this business relationship.
You’ll want to do this as early as you can because it will unite you and repel any hostile ideas, hard feelings, and miscommunication when it comes to what the other person gets, or the fact they may be getting a better deal or spending more on expenses. That’s why you will want to put as much as you can in writing. This should define what salary you will get, what pay rise should you reach a certain milestone, ownership shares, responsibilities and duties and anything else you can think of that may become an area of contention further down the line.
Have A Trusted Outside Opinion You Can Call On
The thing with a family-owned business can be a somewhat closed environment, and that can make the decision-making process quite a difficult to overcome. It could be about growing the business, saving the business, coming up with innovative ways to save money or coming up with innovative ways to go about guerrilla marketing; it doesn’t matter. More often than not you will need to seek an outside opinion to help see the best idea or help choose the best direction.
Coming up with fresh ideas and really getting your creative juices flowing can be hard when you are trying to navigate family relationships, and balance the intricacies that come with that. That’s where having an outsider that you trust comes in, someone who won’t have the same closeness as you. This person, or these people, should be as detached from your family as possible to ensure that their input is valued and not viewed as bias in any way. It is one of the best ways you can improve your operations by giving it a reality check of sorts. Trust us on that one.
Enforce The Need To Get Experience Elsewhere
This one isn’t applicable to all those starting a business, but if you have kids then it is worth listening too. You see, you are starting a business, maybe because you want to give your children a better chance at a better future, and give them a family affair they may want to take on later in life. However, it could see your children want to get involved and join the business from the get go. Well, according to those we spoke to, this isn’t advisable.
Instead, you should encourage your children to get at least – and the emphasis was really placed on this word – three years experience elsewhere. Another, little tip that we were given was about which sector they should get experience in, and that’s anything that is different to the one you operate in. The more unrelated the better. That’s because it could give them added skills when it comes to the joining you and your business. It will also give them a seriously valuable understanding about how the corporate world works, and how business operate, in an environment that is not your workplace. This is super-duper important. It really is.
