When Desmond Griffin and his sister-in-law Penny Green decided to join forces on mobile payments company Glance Technologies Inc. , it was to help expand the business with an eye to taking it public. About three years later, the family members are in a heated dispute – playing out in press releases and online – over the direction of the Vancouver-based financial technology company , a small cap that went public on the Canadian Securities Exchange in September, 2016.
Glance’s technology is used in restaurants and by other merchants and the company says it’s currently developing a rewards-based cryptocurrency to be integrated into its platform.
Ms. Green, the company’s largest shareholder with a slightly higher stake than Mr. Griffin, was fired as president and chief operating officer in February. Ms. Green is still a director and has called a shareholder meeting in June to remove three of the company’s five directors and replace them with her own picks.
It’s a small company that’s not a household name, but it offers lessons for other entrepreneurs. While there’s an old adage that says never go into business with family (or friends), experts say the corporate pairing of relatives can be powerful, if properly handled.
“When an entrepreneurial family gets together to work on something, they care so much more than someone who doesn’t have their name on the building or doesn’t have a stake in the community. To me, that’s a recipe for building a great business,” says David Simpson, head of the Business Families Centre at Western University’s Ivey School of Business. “However, when it goes poorly, it goes poorly doubled down because you’re losing your brother or sister or cousin.”
Family members in business together should also outline what happens if one person wants out, or there’s a disagreement in direction, Mr. Simpson says.
Most often, it’s money and corporate strategy – including how various family members are compensated and disagreement over the direction of the company – that lead to family business feuds, says Jane-Michèle Clark, an instructor who teaches the family enterprise course in the entrepreneurship program at York University’s Schulich School of Business. Ms. Clark recommends business families hold strategy sessions that cover topics such as their family values, how they want the business to work for them and vision for the company.
In an interview, Ms. Green said she would go into business with family again, but acknowledges that a public company may not be the ideal setting. “If you can work with the people that you love, I think that’s fantastic,” she says, but adds that in hindsight, having agreements on how to handle business disputes would have been a good idea.
Still, Ms. Green feels the current feud won’t damage her family relationships in the long run. “This is just a blip in our long-term relationship.”
Source: Bouw, Brenda, April 29, 2018, https://www.theglobeandmail.com/business/small-business/managing/article-when-family-business-gets-ugly/