It’s holiday season 💃🏾. Means I have some time on my hands to answer and share some of the most recurring questions that I receive so keep them coming:
❓Question 1: “Can I go into business with family members?”
I get this one a lot and I fully understand the nervousness around it 😅.
- For some people, business with family has ended up souring their relationships. Maybe business dealings went South and sometimes even when the dealings went well, disputes may have arisen on how to share the spoils
- For others, business with family has been the best decision ever and has created wealth for the individuals and their families for generations to come.
❔So why does it work for some and not others? 😣
First the story: In 2014 we bought a smallholding farm in Chongwe, just outside Lusaka. Its a beautiful piece of land near streams but due to competing priorities did not do much with it for 2 years. Last year George, who is the younger brother of my husband Sandras (in the pic) was sharing about his passion for farming having been inspired whilst previously working with and observing their older brother Ariel and his wife Gorret who are successful farmers. This got Sandras thinking about potentially partnering with George to put the farm to commercial use.
The young George who also happens to be a banker yet serious about his farming vision went into action! Investing his time, money (including buying a vehicle fit for farming rather than a ‘posh ride’) and skills into the project. A year in that’s the two of them on site 2days ago inspecting progress on the current crop. All smiles having successfully weathered the ups and downs of starting a business 😘
- 3 key lessons: that we’ve learnt for creating better odds of success for *ANY* business partnership (not just with family members)
1. Agreement on the financial details beforehand: Who is bringing how much to the table? How do we handle unexpected cost that may arise? How do we handle losses? How will we share profits? Etc
Often when it comes to business with family members we neglect to agree this crucial aspect beforehand let alone sign any partnership agreements 😱. We assume ‘fika isova’ (the details will sort themselves). Unfortunately they don’t and this has been the downfall of many family business ventures and inevitably personal relationships
2. Agreement on roles and responsibilities beforehand: Like any other business partnership it’s important to agree beforehand who will be doing what in the business.
Issues arise when everyone wants to be everything. Its not efficient as not everyone for example can handle sales or finances or operations. Agree beforehand what each member will be responsible for to reduce friction
3. Respect and trust the value that each person brings to the table: We all bring something of value to the table and it’s important to respect and trust that. Sometimes things go wrong because we force relatives to get into something they have no interest or knowledge in because it’s the “business of the day” or “worked for others”.
Eg. As much as I love real estate, land included I personally have zero interest nor knowledge in farming and have therefore trusted and respected those aspects of the partnership to the brothers fully.
So yes business with family _can work_ when you lay the foundations right!