Entrepreneurship in family businesses

There is growing recognition of the prevalence of family businesses and their importance to economies throughout the world. It is estimated that, in most countries, family businesses represent two thirds or more of all businesses (Howorth, Rose and Hamilton, 2006). People are sometimes surprised to learn that some of the largest corporations are family-owned businesses, firms such as IKEA, WalMart or Haribo. Other companies are more well-known for being family businesses because they stress their family roots and use them as a marketing tool; UK readers will be familiar with the Warburton family who make a virtue of their familiness in promoting their products. For many though, family business is associated with SMEs (small and medium sized enterprises) and if you look around any town, you will discover a proliferation of family-owned SMEs. The reality is that entrepreneurship is much less about the heroic individual seeking out opportunities that others cannot see (Ogbor, 2000) and more often about entrepreneurs founding and developing their enterprises along with other family members. A high percentage of entrepreneurs found their businesses in the form of family firms, and, for many more, families are an important source of resources, especially human capital (Aldrich and Cliff, 2003). Many smaller firms find it difficult to disentangle the firm from the family and there is an intertwining of family and business motivations, resources and dreams (Hamilton, 2006). Families can be crucial breeding grounds for enterprise and new businesses, very much the “oxygen that feeds the fire of entrepreneurship” (Rogoff & Heck, 2003). Indeed, any study of small enterprises that ignores the influence of family can only ever be a partial representation of reality: family firms are so prevalent throughout the world