Last week, I was watching Restaurant Impossible on Food Network. In this show, Robert Irvine, TV Personality and a really good chef, has 2 days, and $10,000 to change the fortunes of a failing restaurant. In this episode, Irvine went to Colombia, Missouri to visit McKlanks Restaurant. In this episode, it seemed that there was no function in any way possible. The owner did not trust his employees, and because of that the service, food, and overall quality of the restaurant was terrible. Not to mention that the restaurant needed a lot of renovations inside as well. Over time, the different members in the family started to agree on several things, and trust finally being put in the employees, new renovations, and some new recipes, McKlanks finally got back onto its feet.
Running a family business can be a rewarding experience, but also may create obstacles. Today, I wanted to go over some of the pros and cons of starting/running a family business, whether it is in the business world, or any type of business opportunity.
Pros of Starting A Family Business
By starting a family business, there could be some pros. One of these perks is that there could be some extra motivation to succeed when starting a business based on the relationships with the family members in the business. Because they are family employees, they will want to see the growth of the company and might also work harder than other jobs that they have had in the past. This way, it will help them, and the company will see a much higher success rate.
Additionally, having family members on your team could be a good way of having a more relaxed work environment. Because you know your family members, and have a good relationship with them, you do not have to go through the awkward stage of getting to know your employees because everyone knows each other already
When multiple family members are investing in founding a company, this could also benefit the individual, as they do not have to spend more money and potentially more time on the business that they are growing. This could be when you are investing with people that are not biologically related, but it is one of the biggest positives to going into business with multiple family members.
Lastly, when starting a family business, there will be an increased chance of having a shorter learning curve between the family members, and the other employees as well. Because the family members know how each other works, and know what area of expertise they are best suited for, it could be that the other employees adapt to that pace of working, and it could mean that the company works more efficiently as a team right from the get-go.
For those who do not know, when Ash founded WatchMojo, he started the business alongside his wife Christine. As WatchMojo has gone on to be one of the world’s biggest media brands, I wanted to get Ash’s thoughts on what starting a business alongside his wife was like, and some of the earlier stages in the process of creating the Top 10 mega channel:
“It was a bit contrarian: I told her the incremental risk of her also quitting her job was small, but the overall return would be infinitely higher if we succeeded. I just felt that being in the trenches would be a very arduous thing that would affect me, and her seeing the ins and outs would make her better understand and empathize where I was at (which would invariably affect how I was at home). Mind you, we also had very complementary skills and experiences, so it just made sense. But, to make it work, you need to pick and choose your battles and learn to compromise. I actually don’t recommend it to most people…
We are certainly more family-oriented, at least with the original nucleus that has been together since day 1, for fifteen years! Naturally, that is a long time, so there have been peaks and valleys but overall, while we don’t lack ambition and hustle, it’s created a more empathetic, collaborative, and humane organization that we’re proud of. And indeed, it’s not just the original 5 co-founders, but almost 20% of the team has been with us for 10+ years… it’s a rarity.”
While starting a business along with family members can be a rewarding experience, here are some cons that can play a factor in whether your business will make or break.
Cons of Starting A Family Business
One of the biggest cons to starting a business alongside family members is that the conflict that happens within work can be brought back home. Things happen at work where we argue and it creates several problems. Imagine that you are working with a family member, and it creates a massive problem at work. You still see the same family members at home outside of work and the debate and argument can continue at home. This isn’t the best way to move forward
Furthermore, some family members might abuse their status as family members. For example, they might not have the skills needed to succeed in any role, whether it is an entry-level position or a senior role. However, they might end up having roles that are more senior because family members trust them to do the work, even though they have not had any training in the past. This is why sometimes, it is better to hire and work with people that are not blood-related because family members might be afraid about conflict with family members, however, conversations can be more efficient with outside employees.
Because some family members might be afraid of confrontation with employees, it could result in the company stagnating its growth. Because a more family-oriented culture means that people are more relaxed, they could become too relaxed in a sense, and not see any growth/potential over several quarters. Over time, this may result in the company shutting down because although it is important to have a great work culture, it is even more important that work gets done while also maintaining that level of culture that is inviting and welcoming.
Lastly, when there are times that tough leadership decisions are made, deciding on something that some family members disagree with could result in family members not trusting each other. For example, succession planning is something that every company has to deal with. If there is a candidate that some family members agree with, and other family members do not want that certain person to be the next in line, it can result in the trust being lost, and some of the family members being affected in their positions in the long run.
Starting a business is an exciting, difficult, and roller coaster of a ride, whether you are going into business on your own, with friends, or with family members as well. To make sure that you get the business on the ground running, you need to make sure that you set ground rules, stay committed to your business, and keep any friendships and family relationships outside of work. At the end of the day, you are at your job to work. It is encouraged to have a relaxed work environment, but make sure that work is getting done.
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