CEO.COM
May 8, 2015
4 Reasons Starting A Business With Your Family Isn’t A Bad Idea

If fast-growing technology companies have one challenge in common, it’s finding the talent necessary to maintain that trajectory. For mine – which specializes in VoIP and other cloud communications – that quest sometimes means having more than a dozen recruiting firms simultaneously scouring for developers and other experts.

But when it comes to management, we’ve never had difficulty finding the right people. That’s because my dad, my two brothers and I have been working together since founding Voxox (then Telcentris) in 2006. Along the way, we’ve learned a few things that every entrepreneur should consider when deciding whether and how to bring family into a business.

1. Greater trust

For starters, there’s often a deeper level of trust with a sibling or parent versus someone who isn’t blood. That trust enables a work-life balance because there’s almost always a trusted family member at the office to oversee things. I can go on vacation, for example, with the peace of mind that my brothers or dad are there to make the tough calls and call me in when necessary.

2. More honest communication

Another advantage is that we’re free to be more direct and honest with one another than most non-family executives probably are. Worries about hurt feelings don’t stand in the way of the serious conversations that every successful startup needs to have. We get straight to the point, and we know there’s no hidden agenda.

For example, when we initially launched the first iteration of our desktop consumer app in November 2008, a handful of popular blogs picked up the story. This prompted a download frenzy that we hadn’t anticipated. The previously closed beta desktop app was getting a download per second during the launch and at a slightly slower but still rapid rate for weeks afterwards. The overnight success overwhelmed our technical team with sign-ups and downloads.

My father, brothers and I worked around the clock with our technical team to come up with solutions to these challenges. Our conversations touched on sensitive topics that could have been more difficult to broach with non-family members. Granted, unrelated executives have these kinds of discussions at other companies, but there’s a comfort level that’s difficult to emulate outside of the family circle. Our family bond was very effective in keeping us focused in a stressful situation, and our honesty and openness have helped us build a stronger, more competitive company.

3. Strong support system

Another benefit of the family business dynamic is that we also have one another’s backs, and it’s not because we’re looking for a place to stick the knife. Long before Voxox was even an idea, my father owned a company in the e-commerce space. Some health issues put him in a coma, which his business partners used as an opportunity to steal his portion of the company. My father is a brilliant computer scientist, so my brother, Kevin, and I, thinking opportunistically, brought him into our company.

The moral of the story: When executives can focus on their job instead of worrying about power plays, everyone benefits: their employees, their customers and their investors.

4. Greater control

Our family bond also gave us more control over our destiny. Most of our initial capital came from family and angel investors, so we were able to avoid VCs and the downsides that come with them, such as board members who lack extensive tech experience and shareholders who want to drive a company in the wrong direction.

As a result, we’ve achieved the kind of market share and mind share that have enabled us to attract more substantial capital from large institutional investors – and on much better terms than we would have in the beginning.

Sure, there are a few downsides to working with family. For example, the overlap between our business and personal lives means we don’t have much news left to share when we get together outside the office. It’s also easy to overwork because the conversations are all about business even when it’s a birthday party or wedding reception. But the benefits far outweigh those drawbacks.

author:
Bryan Hertz
bio:
Bryan Hertz, CEO and co-founder of Voxox, is a successful entrepreneur, bringing more than 20 years of experience in building companies and management teams, raising capital and driving technology innovation for Fortune 500 banks, insurance companies and data processing facilities. Bryan entered the telecom industry in 2006 and created Voxox to fulfill his vision to unify personal and business communications on a global basis. Today award-winning Voxox solutions are used in over 200 countries by consumers and businesses.