“Family love is messy, clinging, and of an annoying and repetitive pattern, like bad wallpaper.”
In the last episode, I explained the importance of allowing your baby to leave the nest. This is an important thing to always keep in mind, because many entrepreneurs have a hard time “letting go”. There are many of us who don’t have this problem, but who also have a hard time “letting go” in a different way. I’m talking about you, as the entrepreneur, allowing yourself to leave the nest.
I know it’s extremely tempting to keep family and friends as close as possible to assist you in launching your business. After all, better the devil you know than one you don’t, right?
Unfortunately, when it comes to business, almost all great entrepreneurs will tell you the same thing: don’t go into business with friends and family. There are many reasons for this old adage.
From my personal experience, I know how complicated this can be. I made the mistake once of going into business with my fiancée. I thought that, since marriage is for life, this would not be an issue. Boy, was I wrong. Our relationship quickly deteriorated, and not because of the business, but because of other issues that are not relevant here. Suffice it to say, when the writing was on the wall and time came to decide how we were going to handle running the business together, it became a very delicate situation. Ultimately, I decided to cut my losses and move on; I left the business to her, but I kept many of the debts. So, if my story is not enough to detract you from doing the same mistake, consider this:
First, like with going into business because you like the product more than you like money (see my first post), running a business with family can blind you to issues with your friend or family member’s performance. It is very easy to look the other way when a minor transgression occurs, when performance is lacking, or when the person is just a screw-up. Don’t fool yourself into thinking that because the person is a good employee somewhere else, they will do well as your partner or employee; the sad fact is that many people are not cut out to be entrepreneurs, and behavior on the job will reflect this attitude.
Second, there is a risk of you having to discipline or worse, fire, your loved one. This can cause a permanent rift between you and your loved one. Remember that, especially if you’re the person’s boss, they often expect you to give them special treatment. Think of all the times you’ve seen, in person or on TV, someone say, “my brother owns this place. Get out!”, or, “my father owns this hotel chain. Go screw yourself.”
This can leave a very bad stain on your business’s reputation with customers or the public in general. And although I usually say there’s no such thing as bad publicity (there’ll be a future post detailing this), this is one of the exceptions. You do not want to be known as the business owner who hires family members that abuse customers or other employees.
Furthermore, if you decide to discipline or terminate the business relationship with this person, they may take it as a personal assault. The person may become vindictive, destructive to your business, or worse. Don’t ever underestimate how someone you love and think you know would react if they feel you’ve betrayed them.
Third, there is the problem of money. Nothing can tear even the most tightly-knit family apart quicker than a fight over money. Money decisions, business decisions, and more, can become a point of contention if you own a larger share of the business than your loved one. Some people will also suspect that you are not being completely honest regarding the business finances, even if there is no skullduggery going on. Anything can set these beliefs off in a person, whether it’s a dream, advice from another friend, or a book or TV show the person sees.
So, if you haven’t gotten the point of this article yet, it’s don’t ever go into business with family or friends – the “Devil You Know Principle” works backwards in entrepreneurship. If you do decide to go into business with a friend or family member, plan ahead for these issues by: having an escape/action plan set; drawing up a contract for the partnership; discussing the possibility of a need to end the business relationship before you dive into the madness. And if after reading this you’re still not convinced it’s a bad idea to mix business and blood, watch “The Godfather” all the way to the end. Really, do it.
If you have any comments, questions, or wanna hear the full story of what happened with my tanning salon, please leave a comment or email me at HeadlessHammerhead@gmail.com.