Starting a business with friends or family can be both a blessing and a curse. On the one hand, you have someone to rely on when things get tough. On the other hand, many potential pitfalls can occur when business partners are also family members.
Here are some things to consider before starting a business with a family member and some tips for making it work successfully.
The pros and cons of mixing family and business
Family businesses are a popular choice for many entrepreneurs, and there are several advantages to going into business with a relative, such as:
- Family businesses tend to be more financially stable than other types of companies. It may be because family members are often more willing to invest their own money in the business and to work longer hours to make it succeed.
- They often have strong community ties, which can help attract customers and build a loyal clientele.
- They offer the opportunity for family members to learn new skills and develop closer relationships.
But, some potential drawbacks should be considered, including:
- Setting clear boundaries between work and family life can be hard. When business and personal matters become intertwined, it can lead to conflict and tension.
- Family dynamics can be complex, and it can be challenging to maintain a professional relationship if there are unresolved interpersonal issues.
- Relying on family members for help with the business can create a sense of obligation rather than a true partnership.
Before venturing into entrepreneurship with a family member, seeking legal guidance to address any issues that may arise is imperative. With a bit of planning and a lot of understanding, you can make a family-run business a success.