Top tips for starting a family business?
What could be better than earning an income with the support of the people you love and trust most in the world? In today’s digital landscape, where entrepreneurs have access to endless tools and business models to help them thrive, launching a company of your own is easier than ever. Running a family business is a great way to ensure you don’t have to begin this complex journey alone.
You can employ family members and use their various skills to help you. What’s more, you have a source of value to hand down to the next generation over the years.
When hiring your children for your business, there are even certain tax breaks available. Of course, just like starting any business, launching a company with your loved ones has a number of points to consider. Here’s what you need to know to get started.
Creating Your Business Plan: The Basics
Business plans are some of the most valuable documents any business owner can have, regardless of whether you’re launching a tech startup or a family business.
Your business plan will help you to define the roles of different people in your team, and how they’re going to contribute to your company.
It also offers insights into things like compensation you’re going to be paying each employee, ownership stakes, and exit plans.
Your business plan will be particularly important when the time comes to seek out funding for your family company.
These days, you can take out business loans in a range of amounts with the right lender, with various terms to suit your needs, but most will want to see evidence you’ve considered your target market carefully and thought about how you’re going to make a profit.
Sit down with your entire team and ask yourself what kind of company you’re going to run, who your competitors are, and what kind of succession plan you’re going to put in place when passing the business to new people in your family.
Separating Personal and Professional
Once you’ve created your business plan, it’s also worth thinking about how you’re going to keep your personal and professional lives as separate as possible in the family business.
Mixing business and family makes it easy for business to become the sole topic of conversation at every family event, but this can make it difficult to achieve a good level of work/life balance.
If you’re going to be employing members of family in your business, make sure you start strong with a good idea of how you’re going to keep things separated, to avoid the risk of major fallouts between the people you love most. If you are running your business from home you will need to create separation there too.
Remember, there may be times when the only way to ensure everything remains fair is to hire outsiders and look at things from their perspective.
If you’re concerned about the inevitable clashes between your family and your business over time, it might be worth asking yourself whether the people in your family company are in the right position emotionally and financially to get involved with a new venture at this time. Don’t risk the stability of your family if you’re not certain your plan will work out.