Ties that Bind, Lessons Learned
Johnson MBAs share their perspectives on the value of growing up in a family business at Entrepreneurship at Cornell Celebration 2017.
by Jay Wrolstad
What do you do if you are next in line for joining your family business? Will you choose that route, and if so, when and how? Will you walk away to pursue something entirely different? People faced with that choice say they learned valuable lessons as they decided whether to accept the legacy left by their parents and other close relatives, launch a new business of their own, or gain experience elsewhere and then return to the fold.
Four Johnson MBAs — three Johnson students and an alumnus — shared their personal experiences of growing up in family businesses in a panel discussion of “Entrepreneurs, Intrapreneurs, and Extrapreneurs: Pathways Into and Out of the Family Business,” held April 27, moderated by Steven Benjamin '80, MEng '81, MBA '82, who is a managing partner at Stromiga, a family business. The panel was sponsored by the Smith Family Business Initiative and the Cornell Entrepreneur Network during Entrepreneurship at Cornell Celebration 2017.
Key lessons they learned include:
- Working hard and persevering through challenges while establishing a business
- Cultivating teamwork and cooperation, and
- Taking risks to reap potential rewards.
Andrew Brady, MBA ’10, president and CEO — that’s chief evolutionary officer — of XLR8, the leadership development consultancy founded by his parents, learned to accept uncertainty early on. “My father worked at a hospital when I was a child and decided to leave his job without another one lined up. It was a defining moment for me, because he told me work should be about what you like to do. You have to be willing to take a chance and follow your passion to create something new,” he said.
Natalia Solano Gutierrez, MBA ’17, echoed those remarks, noting that being raised, and participating, in a successful family business gave her the confidence and knowledge to pursue her own dreams. While she did serve as general manager of the industrial supply company her father launched in Colombia, she has set her sights on a career in venture capital and consulting — a choice supported by her family.
Andrew Davoodian, MBA ’17, made a similar decision, ultimately deciding to leave the formal gown retail business his family had launched following their relocation to the U.S. from Iran. Although he now plans to pursue a career in medicine, being immersed in the business throughout his life left a lasting impression, he said.
“Creating a business was the best option for us as a family in a new country,” said Davoodian, whose roles in the business ranged from creating store displays to developing an online storefront. “My grandmother, a seamstress, was a powerful, driven woman, and I learned so much from her. Everyone in our family contributes to the business, which brings us closer together and helps with decision making.”
Xenia Wang, MBA ’17, credits her father’s influence as an entrepreneur for the impetus to launch her own business. “He was my first teacher,” she said of her father, who created a stem cell research company in China. “He knew how to run a business and took me with him to meetings, where I met executives and attended business negotiations.” In addition to learning the importance of networking, Wang came to understand that entrepreneurship can be difficult, with tasks ranging from fundraising and marketing to working with scientists, all of which was instrumental in her decision to start X-Squared Health Sciences, an anti-aging biomedical research business.
Recognizing that many family businesses are plagued by personal conflicts and ownership issues, discussion participants noted that it is critical to have partnership agreements that define the shares of ownership and responsibility.
“Our business is about personal and professional relationships,” Brady said. “You need one-on-one conversations so there is no fragmentation in decision making. You need a clear ownership outline, and you have to be okay with disagreements as part of operating a company.”
A focus on clear job descriptions helps reduce harmful disagreements in family businesses, Gutierrez suggested. “Everyone must know their role in the business and the expectations for each position,” she said, “so that when there are conflicts, you can explain different proposals and actions to be taken and keep personal feelings out of the decisions.”