Hiring and Working with Family Members: Benefits, Pitfalls & Rules

When I founded Coalition Technologies I did it with the express intent to hire only the best possible people and with a very strong aversion to hiring family or friends.  At the time, I believed it would be impossible to be run the business efficiently if I had a family member or friend working for me.  Now, I don’t see things the same way. I have 24 employees total and of those 4 are related to me in some way.

• Jordan, one of my three younger brothers, is my Sales Director.
• Josh, my youngest brother, is an intern.
• Tara, my girlfriend, is my accountant
• Jimmy, my cousin, is an entry level person in Sales.

Actually, my very first employee hired one year after I first founded the company was Tara.  She and I had been having a long distance relationship for the first year of my running the company and when she moved down she started doing my accounting for me.  Immediately afterwards I hired my second employee David to do SEO and basic web design work.  David is long since gone, but Tara is still working here two full years later.  About 6 months after hiring Tara, I hired Jordan as my first salesperson. Finally a month ago I hired Josh and Jimmy.

So why did I change my mind and decide to hire family members?

Benefits of hiring and working with family members:

• You understand their skills, abilities, and limitations well
• They can be more committed
• They are more likely to be honest with you
• You can build a stronger relationship with them if things go well
• They can be more accountable since they can’t just quit and disappear
• Keeps you more focused on the business

Pitfalls of hiring and working with family members:

• Work issues can become personal issues and vice versa
• They are more likely to argue with you as they are used to doing so in their personal lives
• It potentially could ruin your relationship with them
• If you need to fire them, it will be much more difficult and messy
• Other employees could see it as nepotism and become demotivated

Rules for hiring and working with family members:

• Pay them the same way you pay your other employees
• Set clear expectations of work duties and lines between personal and professional interaction
• Create controls that prevent any sort of malfeasance
• Be ready and willing to fire or reward them if necessary
• Separate work from personal time
• Give honest, regular feedback on their performance
• Require family members to follow processes and policies exactly like everyone else

I consider myself to have been pretty lucky in terms of the family members that I have hired.  At this point, I have not had to fire any of them although there have certainly been some difficult times.

Working with your significant other:

Tara and I especially have had some struggles since we live together and work together.  When you are around someone twenty-four hours a day, seven days a week working and living and even taking vacations together even the smallest things can rub you the wrong way.  We have had epic battles over very insignificant matters.

On the plus side of living and working with Tara, I have found that she is almost as committed to the business as I am.  Over the last two years I have averaged 70-80 hours of work per week and she has averaged 50-60.  Her advice has been invaluable to me and a lot of improvements to the company are thanks to her.

Tara is also not afraid at all of telling me when she thinks I am steering the business in the wrong direction (which can be good or bad depending on what that direction is). I find it generally to be helpful to always have a knowledgeable second opinion on decisions and business situations.

One very scary and unpleasant aspect of working and living with your significant other is when personal fights carry over into the workplace.  I have tried very hard to separate personal from professional, but sometimes a personal fight carries into the workplace and makes all of our employees extremely uncomfortable.  I think Tara and I both try to avoid this at all costs but when it happens its ugly and embarrassing.

In a personal relationship though, few things can bring you closer together than sharing the common struggle and burden of building a company.  Going through battles together and pushing through down periods tightens a relationship in pretty incredible ways.

Working with your brothers

Working with Jordan over the last year and a half has gone very well.  Jordan has helped to sell more for the company than we have ever sold before.

Our biggest difficulty has been in getting him to follow processes and policies.  This is no small matter as having everyone play together as a team is crucial for success. I have been working very hard with him to get this issue resolved.

Our personal relationship has grown. When we were young children, Jordan and I were best friends but as we grew up we grew apart. I only talked to him every couple of months before we went to work together.  Now we talk every day and are much closer as a result of having gone through the struggles and joys of building the business.

Josh just started working for me as a lowly intern before he leaves for college at Washington & Lee. Perhaps one day he will earn his way up the ranks if he chooses to work hard and be committed.

Side note: Owning a business is like having a new, very important, family member

In general owning a business is a lot like having a baby.  The amount of time, care, love, devotion, effort, and focus it pulls out of you is massive.  Early on the business is very immature and incapable of fending for itself.  You are confused at how to handle this strange new beast and have little emotional attachment.  Over time the business starts to take on a personality of its own and starts to crawl, then walk, then run.  One day you wake up and realize that you are deeply emotionally committed to it and that it has taken on a life all its own.