Why You Shouldn’t Hire Family to Work at Your Start-Up

by / ⠀Entrepreneurship Startup Advice / September 9, 2013


I’m going to make a statement that will surely make me the most unpopular person at my next family reunion: whatever you do, don’t hire your family to work at your start-up. Managing a start-up is a rewarding experience, and the workplace might even come to feel like your second home—which is exactly why you shouldn’t factor family into the equation. While guiding your company through thick and thin, you’ll see some huge successes, and you’ll also have to traverse some rocky terrain. Often times, tapping family for help might seem like an easy solution, especially because they no doubt understand how excited you are about what you do. But that doesn’t necessarily mean you should involve them. Here’s why:

Are your family members the most qualified for the job, and best positioned to help grow your company? Probably not.

To run a successful startup that can scale quickly, you need to hire a staff with complementary skill sets and approaches to business. The people you hire should be specialists in their field and capable of moving your business forward in ways that you can’t. If hiring family is on your mind, then you likely won’t be open to bringing in the true best candidate for the job. While you might have nothing but the best intentions at heart, don’t put yourself in an awkward situation by hiring a family member who’s not quite the right fit over a more qualified candidate. As your company might not initially have a large staff on its payroll, everyone involved has to be an asset. That being said, be sure that each and every employee has a vested interested in your company for reasons beyond bloodline.

Keep your business well-defined.

Another derisive issue is the potential for favoritism, whether it’s real or perceived. More importantly, family involvement may undermine lines of authority already set within your company. Don’t put yourself in the position of favoring a family member over your other employees, and remember that you have to keep all of your employees in mind. If you hire family, you run the risk of muddying the workplace water by upsetting the chemistry of your staff. Furthermore, your employees might become irritated if your family member naturally reports to you rather than their manager, which will breed discontent.

Really, it’s simple: unless there’s compelling business reason to do so, don’t partner with family members. Hiring them could not only strain your business relationships, but also your personal relationship with them.

Lastly, you deserve some time off once in a while, Mr. (or Ms.) CEO. The start-up lifestyle is all-consuming. You already know that. But when you finally do get the chance to take a breather, you want to enjoy it. It might be hard to take a true, refreshing break if a family member you often see is also your employee.

How will family members factor into adversity at your start-up?

It’s not abnormal for an entrepreneur to go through several start-ups before finding success. Adversity is commonplace – and sometimes, even failure. If there’s a key kernel of entrepreneurship advice that you should remember, it’s this: your personal identity isn’t tied to your business, even if it feels otherwise. The business world is only one sphere of life, with the other sphere containing everything else, including family. If your family is involved in or close to your venture’s failure, it could cause undue stress on your relationships, and will likely make it harder to move on. Further, if your company faces a bout of adversity, you want your family’s support, not their involvement.

Don’t move unnecessary mountains.

Family in the workplace inevitably comes with baggage that you don’t necessarily want to carry – especially when your mind has to be a million other places. In order to make the best decisions for your company, eliminate variables that might cloud your judgment and expertise. After all, if you have family on the brain then your business mind might become clouded, and like good weather, it’s best when clear.

Having been on both sides of the start-up investment scene—seeking investment for his ventures and as an angel investor himself—Alan Lobock recently launched Worthworm to solve one of the biggest challenges young companies and their prospective investors face: pre-money valuation. Alan co-founded SkyMall in 1990, the company whose shopping catalog is found in the seat-back pockets of almost all U.S. commercial aircraft.

Image Credit: yourbusinesssuccession.com 

About The Author

Matt Wilson

Matt Wilson is Co-Founder of Under30Experiences, a travel company for young people ages 21-35. He is the original Co-founder of Under30CEO (Acquired 2016). Matt is the Host of the Live Different Podcast and has 50+ Five Star iTunes Ratings on Health, Fitness, Business and Travel. He brings a unique, uncensored approach to his interviews and writing. His work is published on Under30CEO.com, Forbes, Inc. Magazine, Huffington Post, Reuters, and many others. Matt hosts yoga and fitness retreats in his free time and buys all his food from an organic farm in the jungle of Costa Rica where he lives. He is a shareholder of the Green Bay Packers.