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Starting a Business

My family and I want to start a business together, but I’m worried about conflict. What are the common threats to a family business?

How to start a business with family members.




Family run business can be a very rewarding experience, but as anyone knows, families have a tendency to come with issues that can harm the success of a business.

Before you launch your family business there are four main threats to be aware of. Below we discuss them and tips for managing them.

1. Family feuding

Remember that time your sister stole your favourite top, or that annoying name your brother calls you, or your dad constantly telling you to clean your room?

Family dynamics are complex things that need to be taken into account because if they’re not, personal life will creep into business life and affect decision making. Sometimes conflict is caused by different interests, personal egos or rivalries.

Make sure you communicate openly about everyone’s roles in the business, that there is a common goal, and that there is a distinct line between business time and personal time.

2. Nepotism

There is a delicate balance to strike when running a family business, especially if there are non-family members employed too. Be very aware of hiring, promoting and giving financial rewards based on family relationships rather than merit and ability.

You’re going to upset people, non-family employees will lose motivation and employee retention will become a problem. On the flip side, family members can become complacent, resulting in non-performance. Both of these will cause your bottom line to suffer.

3. Emotions running the business

In family run businesses it’s difficult to say, “it’s not personal, it’s business,” especially if you are directly managing family members. It’s never a pleasant experience receiving critical feedback, but it can feel even more sensitive when coming from someone they love.

Be aware that emotions interfere with business and they can influence your ability to make sound business decisions. Strike a balance between being sensitive enough to not cause problems at home, but be detached enough to keep the business’s wellbeing in mind.

4. Succession planning

Just as important as defining roles for family members in the business is planning for the future.

A successful business needs to be able to function without you or certain family members, for example when someone retires, passes away, or decides it’s not their scene anymore.

Passing a business down generations is a tricky process and its essential to ensure that the people it’s being handed to both want the opportunity and have the skills to continue running the business.

Imagine the pressure on Richard Branson’s son when his elder daughter decided she wanted to study medicine instead of run an empire. Be sure to plan for the future long before you ever need to address the issue as trauma and grief can result in poor business decisions.

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Starting a Business

What are the do’s and don’ts of securing an online domain name?

We asked founder, Wayne Diamond, what the do’s and don’ts are when it comes to entrepreneurs registering domain names for their start-ups…

Wayne Diamond



There’s that L-word again:

“Location, location, location”. It’s the make or break decision. Every estate agent and business owner cannot overemphasise the importance of this Critical Business Decision Number 2 (Number 1, of course, has to do with what you’re going to sell!).

Related: As a start-up, what are the most important areas I should be looking at?


Whatever business you’re in, being close to customers and convenient to business partners and suppliers is essential. That bricks-and-mortar wisdom is equally true in the world of online commerce. Having the right domain name and the right support for your online presence has emerged as a real driver of success.

Some figures put the scale of the opportunity into perspective: US e-commerce is predicted to reach $440 billion by 2017, showing a compound annual growth of 13.8%[1]. While the Internet economy is in its infancy in South Africa and Africa, it is growing strongly: research by World Wide Worx showed that consumers, small and medium businesses and government were already purchasing products and services worth R59 billion on the web three years ago.[2]

So how to secure the best and most profitable Internet real estate to make sure your business can ride the e-commerce wave?

It’s all in the name:

The first decision is what domain to use. One of the exciting developments is the launch of new Internet domain names, so it’s definitely no longer a choice of .com or The proposed dotAfrica (.africa) geoTLD (geographic Top Level Domain) is one option that’s set to come online around the first quarter of next year, but what about the ZAdotCities domains of .joburg, .capetown or .durban? Domain names within these additional geoTLDs will be able to be snapped up by the public around November this year.

While .com remains a good choice for truly international businesses, choosing a domain name with some local flavour is probably going to work well for many companies.

The greater range of domain names also makes it more possible that you will be able to choose the right name for your business. When it comes to the more established domains, like .com or, chances are higher that the name you want has already been taken.

When it comes to that all-important name, received wisdom used to be that short was best, but the trend nowadays seems to have reversed—even phrases are now used. The key is to choose a name that is easily recognisable, that will stick in peoples’ minds and that describes the business well.

Perhaps a good example is the domain used by the writer of this article: is both a brand name and a name that perfectly describes the nature of the business. At just seven characters in length, “domains” is also an easy to spell, easy to remember word – keeping names under ten characters is guaranteed to help audience recall.

Something people will remember easily is absolutely vital.

Some companies use specific names for individual campaigns, but always make sure the business as a whole has its own web address.

Experience has shown that it’s probably worthwhile to register similar domain names to the one you choose, just to keep competitors from taking them in an effort to sow confusion.

My final advice: it’s always a good idea to use an ISPA (Internet Service Providers’ Association of SA) member to help you register the chosen address of your start-up. That way you’ll be sure that all the formalities are correct, and that the company you’re dealing with abides by ISPA’s code of conduct.

Finally, as there are already almost 950 000 domains registered, it’s a good idea to surf to and perform searches to see if the domain you would like is indeed available.

Related: Does the South African government award grants to franchisees?

[1] Chuck Jones, “Ecommerce is growing nicely while mcommerce is on a tear”, Forbes, 2 October 2013, available at

[2] “Internet 2% of SA economy”, 29 May 2012, available at

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Starting a Business

How to protect your business idea when sending them to financial instituitons?

Signing an NDA, is it necessary?

Anton Ressel



How can I protect my business idea before I submit my business plan to financial institutions and other agencies for help?

You have a few options:

Firstly, you can include a disclaimer as an introductory clause, saying that any and all information contained in the business plan and related documents remain the Intellectual Property of xxx (your name) and may not be reproduced, copied or used in any manner without express written consent. This is not legally binding, but usually enough.

Secondly, you could ask them to sign a non-disclosure agreement, which is more binding from a legal perspective. The downside of this is that it can come across as arrogant, especially from someone who is approaching us for help. Personally I refuse to sign any NDA from clients who approach me for help, it just smacks of mistrust and arrogance.

On a final note, good ideas always get copied. If you are that worried that your idea will be stolen, you may need to re-look at it and find ways to make it difficult to replicate, or better yet, make sure you are first to market.

Related: As a start-up, what are the most important areas I should be looking at?

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Starting a Business

Does the South African government award grants to franchisees?

In my experience, unless you as the entrepreneur have some ‘skin in the game’ and a reason to get up and make the business work every morning, it seldom will.

Anton Ressel



I am considering purchasing a children’s education franchise and wanted to know if the government offers grants. The cost of the franchise is R 86 000. If so what are the criteria to qualify and how does one go about it?

Accessing grant funding for a franchise may prove challenging, unless that franchise is registered and accredited, in which case there is a fund that may consider it – see CNBC for more info.

Otherwise, you could look at and see if any of those sources of financing are of interest. It naturally depends on your own PDI (previously disadvantaged individual) status as many of these funds are focused on youth, women and PDI’s.

Finally, on an emotional level I would caution against going all out for grant funding and not loan finance. In my experience, unless you as the entrepreneur have some ‘skin in the game’ and a reason to get up and make the business work every morning, it seldom will.


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