Are you and your sibling thinking about starting a business? Are you considering taking over the family restaurant? Have a cousin who pitched a great idea to you and you want to get in on it? Did your parents ask you to come work for them? Maybe you have a relative your needs a job.
Should you do it?
Going into business with a family member can be exciting. You know that you will have a supportive and loving business partner.
But…
It’s not all fun and games. It’s important to be realistic. Money can be a tricky subject between family members. You must weigh the pros and cons of becoming, or joining, a small family business.
After all, you can leave a job easily enough. But leaving family after a business venture has gone south can make for very difficult holiday meals.
Should You Get Involved in a Business with Family?
We’ll give it to you straight. There are pros and cons to business with family.
Pro: You know them! You most likely have known this person your whole life (or their whole life). You know their strengths, and what they will bring to the business. There will most likely be fewer surprises with this person than someone you don’t know as well. So starting a business venture with a family member versus someone you only recently met could be a great thing.
Con: You know them (sort of). Yes, you know all the good things this person brings to the table…but you also know their flaws. Are they constantly late? Do they speak their mind with no filter? Are they not so great with their finances? Think about how that will translate to the business. Will it get on your nerves more as a business partner than it does now? Plus, some people are different at home, than work. You may know an impassioned person because you’re watching them pursue hobbies but at work they may not be the go-getter you imagined.
Pro: A more flexible work environment. When you go into business with a family member, you have respect for each other’s personal life and understand each other’s needs. You can be more flexible, share responsibilities, and ultimately have a better work-life balance because of going into business with a family member. You can also work out schedules that would be beneficial for all parties.
Con: There is a fine line between personal and professional. If you are a parent going into business with a child, your other employees may feel like you are favoring your child over others. You may also find that a family member employee will take advantage of you because they think you will understand.
If you are afraid this will happen, have the conversation early on when you’re still in the planning or negotiating stage. Just because they are family does not mean they do not have to follow the business rules. You have to make sure they see you as an authority figure or a partner, depending on the work structure. Be clear about the business relationship from the beginning.
Pro: Family wants to see you succeed. Family will always have your back, and they always have your best interest in mind. Remember, when you go into business with a certain family member, the entire family will be involved somehow, and that means lots of people backing the business and wanting to see it succeed.
Con: If it doesn’t succeed, it affects the whole family. No one goes into business thinking it won’t work. But…if that happens, know that some families will cope with it by trying to affix blame. This is not a reason to avoid going into business but it is something to be aware of as you may be navigating this in the future.
There are many very successful family businesses. But before taking on that venture, it is important to have a conversation and make sure expectations are clear. Make a list of your own pros and cons to decide if going into business with a family member is the best decision for your family.
The last thing you want is for a business venture to ruin a family relationship. Making sure that you are both on the same page and fully committed to making it work is the first step toward success.
Leave a Reply