Treat people you do business with as if they were a part of your family. - Konosuke Matsushita

“Siblings are the people we practice on, the people who teach us about fairness and cooperation and kindness and caring --- quite often the hard way.” – Pamela Dugdale

Treat people you do business with as if they were a part of your family.

- Konosuke Matsushita

Those are the words of the late Japanese industrialist who founded Panasonic, Kōnosuke Matsushita (松下幸之助, Matsushita Kōnosuke). Matsushita cared deeply for the employees of his company as if they were family. Matsushita firmly believed that a business as large as his was responsible to help all of society prosper, and not simply for those that owned and ran the company to prosper.

The following words:

1. Joint Account

2. Family Banking

3. Pooled Funding A.K.A One Wallet Economy

4. Participatory Budgeting

These four words have one thing in common, the money is being shared by two or more entities. In this blog post, I will post two articles about sibling partnership which I believe it is a great idea for intentional communities and your family.

As Dr Pamela Dugdale said: “Siblings are the people we practice on, the people who teach us about fairness and cooperation and kindness and caring --- quite often the hard way.”

Sibling Partnership to me, is more than just a business ownership between the family members, it is also a way of sharing money among the siblings like the One Wallet Economy.

How To Work Well With Your Business Owner Siblings

By Generational Equity

In past articles we have examined the challenges of family dynamics when running and operating a closely held, family-run business. We have also talked about the challenges of a parent deciding when, who, and how to pass the family business on to his or her offspring. History is replete with family-run businesses that exist well into future generations. However, it is also full of stories that clearly describe the failings of these businesses and how difficult it can be to maintain a family-run business beyond the first generation.

As challenging as parent/child relationships can be, we have likewise seen in our practice just how challenging it is for siblings to operate as co-owners. Quite a few of our clients are brother/brother or brother/sister owners. Others have several siblings involved in the ownership structure. Even if the siblings started the business from scratch together, it can often be hard when they finally reach the time to exit to do so in an agreeable, orderly fashion.

Quite often the issues we face in getting two siblings to concur on a business sale were created years earlier in the business growth by barriers, walls, and in some cases seeds of outright distrust that were planted by comments or actions that were difficult for the siblings to overcome.

Because of this, I thought I would share with the readers of our blog some great advice I recently came across on Entrepreneur.com from a pair of sibling co-owners. Authored by Matthew Toren, “contributor, serial entrepreneur, mentor and co-founder of YoungEntrepreneur.com,” the piece offers fantastic advice to any of you who are co-owners of a small business (or even a larger one) with one or more of your siblings.

Treat people you do business with as if they were a part of your family. - Konosuke Matsushita

[PHOTO SOURCE: https://www.azquotes.com/quote/1521938]

https://thesamuraiseven7.blogspot.com/2023/03/the-one-wallet-economy-of-konohana.html

https://thesamuraiseven7.blogspot.com/2023/03/the-7-guiding-principles-of-konosuke.html

His five keys to successful sibling relationships include:

Choose to play to your strengths
Set expectations ahead of time and in writing
Communicate frequently and disclose fully
Make decisions as partners
Get the resources you need

Based on our years of working with family-run businesses, we agree with all of this advice. Each of these is equally important, but to avoid conflicts down the road as the business grows, we have seen how vital the second one is. The siblings we have seen that work best together throughout the years have been those that clearly outline (in writing if possible) what each person will be responsible for – and once these designations are established – stay out of each other’s hair!

We have rarely seen siblings who have the same skill set. Generally what we have experienced is that one will be more comfortable with financial management and/or operations and the other sales and marketing. Now this demarcation does not always fall cleanly into this segmentation, but more often than not, it does. And when it does, as long as the two (or more) siblings have allowed each other freedom to manage and lead their respective groups, the more success we have seen longer term.

This method does not ensure sibling success in operating a business, but it definitely helps. So if you are part owner in a sibling-run business, clearly outline what each of you will be focusing on based on your individual strengths and interests. Allow each other the space to operate and the freedom to make decisions that are not second-guessed. If input is asked about key decisions (see number four above), then give it but be sure that you trust your sibling(s) to do their jobs.

“The real secret of happiness is not what you give or what you receive, it’s what you share.” — Suzanne Woods Fisher

Treat people you do business with as if they were a part of your family. - Konosuke Matsushita

This is everyone’s money. Money is an expression of our own hearts. In the world today, there are many misfortunes involving money. Here, people live supporting each other. If people’s hearts become one, it is natural that money also become one and is shared by everyone. Everyone can live happily with less money than if they owned it individually. This is one wallet economy. – Accountant of the Konohana Family

https://thesamuraiseven7.blogspot.com/2023/03/the-one-wallet-economy-of-konohana.html

Joint bank accounts explained

Decide if opening a bank account with someone else is right for you

[PHOTO SOURCE: https://www.moneysavingexpert.com/banking/best-joint-bank-savings-accounts/]

Two Other Tips

To the great list that Mr. Toren has provided us, I would add a couple of more based on our experience. First, agree with your siblings that family gatherings are NOT the place to bring up business issues, problems, and decisions. We have found this to be not only counter-productive but it can also allow family members who have no ownership in the business to give their “advice,” much of it unwanted and unneeded. If there are a number of family members with minority ownerships, then key decisions should be made at specific meetings of the “board,” not over Christmas Dinner after a few too many of Aunt Martha’s famous spiked eggnogs.

Secondly, and most importantly, sooth and fix hurt feelings ASAP. Do not let bad karma fester in a business/sibling relationship. This becomes especially true if you are on an exit plan that will require the two (or more) of you to agree to a sale. Far too often our dealmakers see a perfectly good financial transaction go up in smoke because of hurt feelings generated by a word or a deed years earlier. As challenging as it is, ferret out these issues so that when the time approaches for the siblings to agree to the business sale, both are in agreement.

Now in many transactions we work on with sibling ownership, it is not necessary or even needed for both (or more) to exit. In many deals we have closed, the OPTIMAL deal was a partial sale where an equity group cashed out an older brother and the younger brother was retained to operate the new entity as a holding of the equity firm. But even with this structure, legally before a co-owned business is sold, both siblings have to agree. So be sure to address any inter-family squabbles that have been allowed to fester longer before hiring an M&A advisory firm to work for you.

You don't have to be a mathematician to have a feel for numbers. - John Forbes Nash, Jr.

"Divide your fortune into four equal parts: stocks, real estate, bonds and gold coins. Be prepared to lose on one of them most of the time. During inflation, you will lose on bonds and win on gold and real-estate; during deflation, you lose on real estate and win on bonds, while your stocks will see you through both periods, though in a mixed fashion. Whenever performance differences cause a major imbalance, rebalance your fortunes back to the four equal parts.” – Jakob Fugger

Happiness comes from spiritual wealth, not material wealth... Happiness comes from giving, not getting. If we try hard to bring happiness to others, we cannot stop it from coming to us also. To get joy, we must give it, and to keep joy, we must scatter it. - John Templeton

PHOTO CAPTION: Businessman giving money (Australian dollars) at working desk

[PHOTO SOURCE: https://stock.adobe.com/au/images/businessman-giving-money-australian-dollars-at-working-desk/161409718]

Naturally, any enterprise where family members are involved will have the opportunity to create family friction – chafing that would most often not be present if the company were not family run. These issues go back to Cain and Abel, and although they cannot be avoided, their impact can be minimized.

To learn more about how you and your siblings can prepare your company, and yourselves, to be ready to eventually sell, I invite you to attend a Generational Equity M&A seminar. While there you will not only learn a great deal about the overall M&A process, you will also have the opportunity to speak with our one of our managing directors and seminar leaders, many of whom owned (and in some cases) co-owned a family business.

And we want to give a special thanks to Matthew Toren for writing an insightful piece on how siblings can get along even while running a company. You can read the entire article here: 5 Keys to Successful Sibling Partnerships.

Carl Doerksen is the Director of Corporate Development at Generational Equity.

INTERNET SOURCE: https://www.genequityco.com/insights/how-to-work-well-with-your-business-owner-siblings

5 Keys to Successful Sibling Partnerships Family may come first, but follow these five tried-and-tested tips to ensure your relationship can survive and thrive as a business partnership.

By Matthew Toren • Aug 4, 2014

Opinions expressed by Entrepreneur contributors are their own.

One Bank for family banking

[PHOTO SOURCE: https://www.clayfin.com/blog/one-bank-for-your-family-banking/]

Family may know you better than anyone, but should you be in business together? Sibling partnerships have a long history of huge successes, such as the Wright brothers, and huge failures, like the Kellogg brothers. There are even far more dramatic examples of sibling rivalry that snowballed out of control into full-blown warfare like the dissolving of the Kellogg brother's relationship or the Bronfman's of the Seagram's brand.

So what makes some sibling partnerships a great success, while others create a chasm so great it rips familial ties apart? While the truth is that there are many reasons for unsuccessful sibling partnerships, here are the top five things that are sure to help improve your sibling partnership success story.

1. Choose to play to your strengths. Before you get into business with a sibling, you need to decide who is good at what and make sure that's how your partnership is divided. When brothers Walt and Roy Disney co-founded their company, there must've been a clear understanding of who was good at what, and each was allowed to play to their individual strengths.

Walt was the dreamer, the creative, the big picture and big vision guy who saw the possibility and had the imagination necessary to create the Disney Company. His older brother Roy was the businessman, budget-conscious, bottom-line guy who was able to handle the details, finances and deals necessary to actually build his little brother's vision.

A partnership like Walt and Roy's is an ideal collaboration of playing to your strengths and drafting off the skills and talents of a partner. No one person can do it all but a great partnership can offer the best of multiple arenas. The Disney brothers were able to see the big picture and ultimately retained a good working and family relationship that lasted through from the founding of the Disney Company to Walt's death. They leveraged a dream and smart business decisions into an empire that is now a living legacy.

For that to happen, both parties need to play to their strengths and be willing to set their ego aside for the vision of the business and the strength of their partnership.

By contrast, look at the Kellogg brothers, who were unable to set aside ego, unable to communicate and not willing to allow the other partner/brother to give the right input for success. The Kellogg Company ultimately was established and successful thanks to younger brother Will, but not without a decade-long legal battle where he and his brother John sued each other and battled bitterly over who invented Corn Flakes or granola and which had the rights to distribute the cereals they created.

Who knows what else they might've created if their egos and legal battles hadn't impaired not only their product development, but also destroyed their sibling relationship.

Takeaways:

Don't let ego get in the way of your partnership. Decide what is best for the business and be willing to forgo what's always best for you.
Play to your strengths and allow your sibling to play to theirs. The freedom to be unbound in what you're doing will make a big difference in your abilities to leverage your unique qualifications.

“The real secret of happiness is not what you give or what you receive, it’s what you share.” — Suzanne Woods Fisher

Treat people you do business with as if they were a part of your family. - Konosuke Matsushita

[PHOTO SOURCE: https://www.forbes.com/advisor/banking/savings/best-savings-accounts-for-kids/]

2. Set expectations ahead of time and in writing. It's easy to want to "play nice" when it comes to family and think that all the nitty gritty details of your partnership can be left to verbal agreements and assumptions, but that's a huge mistake.

You need to put all expectations about performance, roles, authority and any other aspect of the business plan and leaderships expectations into writing, together and ahead of time. That's perhaps even more important with a sibling or family member partnership than with a non-familial relationship.

Writing up expectations and holding each other responsible to the commitments in writing is a very important aspect of ensuring your ongoing success in business and as a family. It's far better to butt heads in the beginning of a partnership and test your true ability to partner together than to be nice, put expectations on the backburner, and assume that the details will get hashed out later.

This particular point was driven home in a recent article on Lifestinks, a line of natural deodorant and bath products. The co-founders of this more than $1 million annual revenue startup are three sisters: Mary, Annie and Clare.

In an interview with Crain's Chicago Business, sister Mary sums this up: "Clean up any issues before you go into business together. You need a rock-solid relationship … Anything that is unresolved will escalate."

Takeaways:

Establish expectations for each sibling's role before getting into business.
Clean up any lingering inter-personal issues so you can start the business together with a clean slate, free from the past.

3. Communicate frequently and disclose fully. Like any great relationship, communication is the real key to success. Communicating expectations up front is important and likewise so is the ongoing commitment to communication. Working long, hard hours together day in and day out can be a challenge. You combine that with the time you'll likely spend together outside of the business at a familial level and things can escalate quickly if you don't effectively practice great communication.

My brother Adam and I know all too well the importance of great communication. Having co-founded and run numerous successful businesses, and even co-written two books together, Kidpreneurs: Young Entrepreneurs With Big Ideas and Small Business, Big Vision, we are no strangers to collaboration.

In an article on CNBC, my younger brother Adam explained the importance of communicating with a sibling partnership. "We can have a tendency to feel like a loved one knows us so well that we shouldn't have to voice our feelings or expectations," he writes. "But if you want your partnership to work, it's important to let go of these assumptions and communicate clearly and openly, just as you would with a non-family business partner."

Don't take your sibling partner for granted, or assume that just because they're family, they can read your mind. Effective, frequent communication and good listening skills will take you far in your partnership with a sibling.

Takeaways:

Don't assume your sibling partner(s) know what you're thinking. Express feelings, opinions and ideas effectively.
Don't bottle it up. Find a respectful, consistent method to communicate for continued success.

Mathematics is the cheapest science. Unlike physics or chemistry, it does not require any expensive equipment. All one needs for mathematics is a pencil and paper. - George Pólya

[PHOTO SOURCE: https://www.facebook.com/mathsquotes/photos/pb.100063916962716.-2207520000/406079107699915/?type=3]

4. Make decisions as partners. In a sibling partnership, it's important that regardless of your clearly-defined roles, you consult each other on the decisions that shape and effect the company. Partners should have a say in what's happening in not just the day-to-day, but also in the scope and long-term planning of your partnership.

Just because one sibling is the business side and another is the creative doesn't mean business decisions should be made without running them past the creative side of the partnership, and vice versa.

Take sisters Megan and Bridget Torregrossa, who created their own line of luxury handbags, Torregrossa. Each sister is able to focus on the skill set they excel at, while moving toward their common goal and dream of creating a luxury handbag line. In an interview with Forbes, the sisters share that making collaborative decisions, regardless of their specialty, is still key to their success together.

"As sisters we are always honest with each other and have only our brand's best interest in mind when we make any decision together," Megan said.

Takeaways:

Utilize your individual strengths, but collaborate on all the important business decisions together.
Bring your unique skill sets together and watch your business dream take off.

“Without mathematics, there’s nothing you can do. Everything around you is mathematics. Everything around you is numbers.” ~ Shakuntala Devi

[PHOTO SOURCE: https://www.homeschoolingsc.org/5-of-the-best-math-quotes/]

5. Get the resources you need. When you first get started, it may very well just be you and your siblings. But as your company grows and the revenue starts to support bringing on employees, make sure you get the resources and support you need to relieve the pressure and stress of running your business.

It's important to discuss which staff members will impact the overall business most, and not get too stuck on which sibling's silo of expertise that goes to support. Remember, it's always about the bottom-line growth of the company and what's best for your partnership and business overall. Be wiling to utilize that good communication to effectively decide what's best for everyone and step away from your ego.

Getting the resources you need becomes crucial to the rapid expansion and success of the sibling partnership. Take the Cook family, co-founders of myYearbook.

It all started when oldest brother, Geoff, started and sold his first business when he was 24. Little did Geoff know he was inspiring his younger brother and sister to follow in his entrepreneurial footsteps.

Little sister Catherine Cook had the revelation after a move at 14 years old that it would be a lot easier to get to know people in her new town if the yearbook was online. She and her brother Dave noodled on how that might be possible and ultimately pitched the idea to their older brother. Geoff became the original investor in myYearbook, putting $250,000 of his own money into his kid sister and brother's idea and became CEO.

With their sibling leadership in place and seed money to get started, the next big step was the resources to build out the business. That paid off when myYearbook merged with Quepasa in a $100 million deal. MyYearbook has since transformed into a new endeavor, MeetMe, with the goal to go global.

Takeaway:

Don't be afraid to go after the resources you need to scale your business and make your sibling partnership a success.
Consult each other before bringing on new employees, vendors or resources regardless of individual positions for long-term success.

INTERNET SOURCE: https://www.entrepreneur.com/growing-a-business/5-keys-to-successful-sibling-partnerships/236080

OTHER SIBLING PARTNERSHIP LINKS:

https://www.thefbcg.com/resource/developing-the-sibling-partnership/

https://seekingsuccession.com/sibling-partnerships-successful/

https://www.thefbcg.com/resource/developing-the-sibling-partnership/

3 things you should know before opening a joint bank account

[PHOTO SOURCE: https://globalnews.ca/news/5297229/joint-bank-account-significant-other-partner/]

ORDNUNG GELDSCHRANK LINKS:

PARTICIPATORY BUDGETING FOR THE COMMUNITY

https://blackforestproject421.blogspot.com/2023/07/participatory-budgeting-for-community.html

“Savings without a mission is garbage. Your money needs to work for you, not lie around you.” – Dave Ramsey

THE ENVELOPE BUDGETING METHOD

https://blackforestproject421.blogspot.com/2023/09/the-envelope-budgeting-method.html

CASH IS KING AND WHY THE WORLD WILL NOT GO CASHLESS

https://blackforestproject421.blogspot.com/2023/06/cash-is-king-and-why-world-will-not-go.html

Kakeibo (家計簿) Links:

Making more money will not solve your problems if cash flow management is your problem. - Robert Kiyosaki

https://thesamuraiseven7.blogspot.com/2023/04/my-kakeibo-journal-part-1.html

https://thesamuraiseven7.blogspot.com/2023/03/the-one-wallet-economy-of-konohana.html

“He who laughs at one yen will weep at one yen.”

https://www.jrpass.com/blog/everything-you-need-to-know-about-japanese-yen-when-traveling

https://thesamuraiseven7.blogspot.com/2023/06/why-japan-still-uses-cash.html

It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for. - Robert Kiyosaki

https://thesamuraiseven7.blogspot.com/2023/04/robert-kiyosaki-on-budgeting-your-income.html

Treat people you do business with as if they were a part of your family. - Konosuke Matsushita

https://thesamuraiseven7.blogspot.com/2023/03/the-7-guiding-principles-of-konosuke.html

The family that works together, eats together, and prays together, stays together. – Amish Proverb

Meet the McCallums, one of Australia's few Amish families

Ever wanted to not just slow down, but jump off the grid? A family leaves behind the trappings of the 21st century to lead a simple, pious life in rural Tasmania.

Springfield Farm Fresh Produce - McCallum Family

[PHOTO SOURCE: https://maps.app.goo.gl/r9BLz6rNjPR59YG99]

BLOG: https://blackforestproject421.blogspot.com/2023/05/family-value-quotes.html

BLOG: https://blackforestproject421.blogspot.com/2023/11/the-mccallums-one-of-australias-few.html

Search This Blog

The Black Forest Project 421

SIBLING PARTNERSHIP – FOR FAMILY AND COMMUNITY

How To Work Well With Your Business Owner Siblings

Two Other Tips

5 Keys to Successful Sibling Partnerships Family may come first, but follow these five tried-and-tested tips to ensure your relationship can survive and thrive as a business partnership.

Comments

Post a Comment

Popular posts from this blog

The McCallums – One of Australia’s few Amish families

The McCallums and their community

SIMPLE LIVING QUOTES PART 1 - MEET TITUS MORRIS