Confessions of an Entrepreneur: Your Family and Your Entrepreneurial Venture
August 12, 2020 | By Mark Zweig
Something that is rarely talked about is your family and their influence on your entrepreneurial venture.
Here’s the truth — if your family isn’t behind you, you will have problems.
Here are some potential issues you may face related to your family and your business that you may have already experienced but if not, ones you need to be prepared for when they do crop up:
- Co-signing for the debt.
- Making the financial sacrifices that have to be made.
- Work hours — doing what you have to do on a daily basis.
- Being able to respond to problems 24 hours a day.
- Understanding your stress.
- Picking up some of the responsibilities.
- Working with your spouse.
- Employing your children and other family members.
Here’s the deal. If you own a small business and you need to borrow money from a bank — and you don’t have a long history of successful operations along with a very healthy balance sheet — you will not only be asked to personally guarantee the debt, but your spouse will be required to sign also. If your spouse didn’t come from a business-owning family, or you got married long after your business was established, he or she may not understand why they are being asked to guarantee your business debt. They may not know this is “normal.” And as the numbers get really big (say millions of dollars), it may seem overly risky to them. That could pose a problem for you!
Again, when families are used to having a certain income coming from your employment in a job, it may be hard for them to understand that you probably aren’t making what you used to make in that job — at least for the first year or two or at other times in the growth and development of your company. You may have to do a lot of educating of your spouse and children about why these short-term sacrifices are necessary to achieve your family’s longer-term goals.
The hours required from the owners of a fledgling business or a growth business may cause some friction with your spouse or kids. They may not understand why you can’t be at a soccer game or why you have to be on the phone at the same time as the kids need to be read to and put to bed. This is a big, common problem, and you need to be empathetic while at the same time resolute in your need for help so you can do whatever the business requires from you.
See my point number three above. I can’t tell you how many times I got in trouble for being on my phone at night or on vacation with my then-spouse who came from a family background where both of her parents were teachers. They just didn’t have to work like that and it was hard for her to understand why I did. Your spouse may get the idea you love your business more than them — not a recipe for a happy relationship between two people!
Your spouse, kids, and even your parents (depending on their background and how well you communicate with them) may not appreciate the daily stress that comes along with owning your own business(es) and having payroll obligations you have to meet. Not to mention people problems, problems collecting money owed to you, regulatory problems, customer service problems, and so on. If they don’t have that appreciation, you won’t get the emotional support you may need at times. If you don’t get it from them who will you get it from? This is a serious problem!
Again, that business of yours may at times require travel or work on weekends or evenings that makes it impossible for you to fulfill other family responsibilities that your spouse or children (rightfully) expect you to fill. It will take a lot of understanding and teamwork along with an open acknowledgement and appreciation from you for those who fill in for you when you need it most.
I could write an entire article (or maybe even a book!) on this subject. Let me just say that it isn’t always easy. The problems are many. If you do it, let me suggest you each have very well-defined, non-overlapping roles in the business. The last thing you want to do is to try to co-manage the business as a two-headed monster. Your employees will be confused. You will have conflict. That’s not good for your business or your relationship. And, you will have to have time at home where you completely stay away from the business talk or it could consume you completely.
It’s generally not such a great idea, especially in businesses that employ a lot of smart, educated people. Employees will assume the child is getting special treatment even if they aren’t. And you will probably feel the pressure to not do that so you could end up holding back your child — the last thing you want to do by employing them. This is tricky. Never hire your kids directly into management. Work them through low-level jobs in various areas. Encourage them to work somewhere else before coming into your business. Treat them fairly like you would any other employee. Don’t overpromote them and don’t artificially hold them back. And again — get your spouse on board with what you are trying to do. The other parent of your child who works for you may expect you to move them along faster than you are doing because they don’t understand the complexities of nepotism.
I could go on here but will stop for now. The important thing is to be aware of how having your business is going to impact all of your family and your relationships with them and to be prepared!