Did you know that family-owned businesses account for 33 percent of the S&P 500 firms, 64 percent of the nation’s gross domestic product, 80 percent of the U.S. workforce, 65 percent of wages paid and 86 percent of jobs created in the past decade?
In fact, the Family Firm Institute claims the family business is the world’s dominant form of business organization.
Small? Not at all. Challenging? Complicated? Well, yes. Family businesses face tests and threats uniquely their own.
Consider that the business system, the ownership/governance system and the family itself overlap. Roles often overlap as well. Grandparents, parents and sons and daughters are also CEOs, founders, owners, presidents and “the next generation.”
Family conflicts can spill over into work and work problems can carry to the dinner table. Inadequate estate and/or succession planning can also lead to downfall.
That’s probably why only an estimated 40 percent of family owned businesses survive to the second generation, 12 percent make it to the third and a mere three percent last to the fourth generation,
a mark some of our award winners have a chance to make.
Family businesses, however, can also be the bright spots in an otherwise dark and cloudy economic environment. Numerous studies have provided empirical support to the notion that family-owned companies do better because their owners think long term.
Whatever you think of family businesses, they are going through some historic changes. Robert Avery of Cornell University claims that by 2050, virtually all closely held and family owned businesses in the country will lose their primary owner to death or retirement.
We don’t want to get too far ahead of ourselves, though, because we have some family owned businesses we would like to tell you about today, the winners—and all eight finalists—of the Minnesota Family Business Awards.
Some are stereotypical multi-generational businesses, and others are not. Accordingly, the members of the selection committee were careful not to impose their own individual views of what a family business should look like on the process.
These enterprises come from different areas of the state and from a variety of business sectors. We trust, however, that you will find value in all of their stories and enjoy getting to know them, just as we did.
To the winners, finalists and all of our worthy applicants, congratulations, and our thanks for the contributions you make