The challenges of running a business with family members

Here, 'Rajal Patni, CFO and co-founder of WeMa Life, explores the concept of running a business with a family member, and all the challenges that brings.

Families are strange, unique and complicated; they are tightly meshed groups of people typically living in one another’s pockets, which can invariably lead to arguments or irritation. It might seem strange, therefore, that some families decide to start a business together – after all, if you clash over household chores, then how are you going to successfully run a business together?

The challenges

The first step for any family-run business is to recognise that they face unique challenges. Unlike a normal business, the ability to separate the family and the workplace is paramount for success. If businesses aren’t careful, merging the two can lead to arguments based on personal egos or rivalries. This can potentially create a hostile working environment that is damaging to success.

From initially setting up a company to scaling it up, small family-run businesses need to establish boundaries. Family feuds can be bad at the best of times, but when money and commercial success are involved this only exacerbates the problem.

Thankfully, in setting up WeMa Life, our family was able to overcome these issues. While disagreements naturally occur from time-to-time, we made sure there remain clear boundaries between private life and work life.

However, even with the proper boundaries in place, family-run businesses can fail – of course, so can any business. Uniquely for family businesses, when scaling up and hiring new employees there are different issues to overcome to those faced by most small businesses.

One of which is to ensure they are open and welcoming to new staff; it is vital that cliques do not emerge or that new people who join the team do not feel like outsiders – after all, having new members of staff joining the core family unit is vital because these people bring fresh perspectives and energy into a well-established dynamic.

Ensuring that nepotism doesn’t take hold is also extremely important. Whether it’s giving other people the final say in key decisions or enabling progression up the business, family-run start-ups have to make sure equal opportunities exist for all staff, regardless of their surname.

Indeed, if you close off chances for promotion, new staff will simply go elsewhere; no one wants to join a company with no future job prospects. Therefore, keeping talented staff means that family-run businesses must ensure there are leadership positions for non-family members.

The Opportunities

Although, these kind of businesses face unique challenges they also enjoy their own benefits and opportunities. While the challenges of hiring new staff, nepotism and separating personal and business lives are difficult, the creation of a family-run business typically ensures commitment.

As a family risks their success on that of the business, employees will have an extra sense of purpose and pride in achieving targets – in turn providing a family-run business with a competitive edge.

Another important reason why family-run businesses are well placed to succeed is that they are often built on shared values and experiences. Take WeMa Life for example; the company was founded after my husband, my son and I experienced the difficulty of booking health, care and wellbeing services for an elderly relative.

We were all left asking the same question: Surely there is a better way to source, book and pay for health and care professionals? And so the premise of our business was born – and one year later, on 27 February 2018 to be exact, WeMa Life launched.

Sharing the same vision, we were inspired to use our varied backgrounds to develop an online marketplace and app to connect health and care providers with people needing these services for themselves or a loved one. Without that shared goal, which stemmed from our shared experience, we wouldn’t have been able to create and achieve our target.

Of course, in the day-to-day running of a business, there are other advantages of being in a family-run business. Namely, the level of mutual understanding the core family unit has means they know what to say and what to avoid. In WeMa Life’s case, as the three co-founders are family members we understand how to motivate each other and how best to communicate our ideas and challenges.

Should you start a family business?

Starting a family business is not for everyone. In fact, for the vast majority of family it either does not appeal or simply makes no professional sense. What’s more, some families find the challenge of separating their personal and business lives too hard.

But in deciding if you should start a business, there needs to be an assessment of why do you want to start a business in the first place? If you share a common goal, similar business ethics and have strong bonds then this will give you a head start on many co-founders. Indeed, the thought of spending hours upon hours in one another’s company each day has to not scare you off.

Without answering these questions, the risk of failure increases. But for those who take a diligent approach before making the leap, they will find that the experience will bring you all together. Moreover, the prospect of celebrating business successes with those closest to you is a fantastic motivation.

Rajal Patni is chief financial officer and co-founder of WeMa Life

Further reading on running a business with family

Owen Gough, SmallBusiness UK

Owen Gough

Owen was a reporter for Bonhill Group plc writing across the and titles before moving on to be a Digital Technology reporter for the

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