Family Business Scale-ups: Breaking Barriers to Growth
Insight piece
Key insights
Family structures to manage longevity, growth and investment
in taking on Dad’s business. I can promise them that we will look after the business and keep all customers and staff as best we can - which is something investors or private equity can’t promise - and make their business become a part of something bigger.” The brand of a family business reflects the family name – meaning quality won’t be sacrificed for speed or the other usual pitfalls of scaling up. At Strathberry, Leeanne Hundleby notes that “up to 80 pattern pieces go into one bag and every product is handmade; you cannot lose that care as you scale up”. Long-term generational thinking allows firms to make investment decisions that a public company might struggle to justify. Macphie installed wind turbines with a ten-year payback period, prioritising generational sustainability over quick returns. It now generates 70% of its own power, an ambition justified by long-term independence rather than immediate profit. “You wouldn’t put up two turbines with a ten- year payback. It just wouldn’t happen in many businesses – we’re talking about ten years to generations,” Macphie says.
myself. With 100% ownership of our property and energy interests and a 60% stake in the food business, I recognised that my family shouldn’t always have to abide by my word alone. By appointing independent chairs, we’ve empowered our two businesses to operate with professional autonomy while encouraging maximum synergies between them.” Bettys & Taylors introduced a Family Constitution in 1996, designed to govern and balance the relationships between the family and the business. It now has a Family Assembly and an Owners Council to represent the views of the shareholders. “There’s considerable infrastructure in place to maintain family influence, which is particularly important as we currently have no family members on the Board,” says Antony Barnes, Chair of the Owners Council at Bettys & Taylors. “We needed to ensure that the family and the business maintain a close relationship. At the same time, we are fortunate that we have built an extremely capable Board and leadership team, who continue to deliver strong performance despite challenging external conditions.” Bennie’s acquisition strategy involves working with family firms with no succession plan. “We’ve bought five businesses so far, with a range of turnovers up to £10 million,” says Managing Director Matthew Ayres, “All were run by married men whose next generation were not interested
Multi-generational family firms tend to formalise the family’s influence.
Macphie implemented a structured family council in 2012, integrating the next generation into governance early. “Myself, my sister and five of the next generation are all part of the family council,” says Alastair Macphie. “To shore up governance, I transitioned away from chairing the family council “You wouldn’t put up two turbines with a ten-year payback. It just wouldn’t happen in many businesses – we’re talking about ten years to generations”
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