Family businesses can be quite successful,...but the managing and intermingling of blood and commerce, insiders and outsiders, requires a deft hand, planning and enormous amounts of trust.
You might say that a family business is more than the sum of its parts. Unfortunately, those “parts” do not always see things the same way, whether it’s the family part or it’s the business part. Family businesses that successfully pass from generation to generation tend to toe the line in more ways than one.
For one of those all-too-possible horror stories of succession and family business gone awry, consider the case of the Luray Caverns and the Graves family. The Washington Post recently recounted the story in an article titled “The rift — a family dynasty fights over the future of Luray Caverns.”
The business of the Graves family was really an empire of various tourist businesses surrounding the Luray Caverns – the largest privately held cave system and tourism hotspot since the late 1800s. The family business apparently had been on a downward slope for some time. To make matters worse, this four generation family business has been in and out of litigation for the last ten years. In the end, not only has this discord threatened the family fortune and the business that built it, but the entire town associated with the family and the business.
More than a sad tale, this case is an object lesson for other family businesses and the original article is worth reading. With business succession planning, it is best to get the help of competent legal professionals long before it is time to pass the torch of the family business down the family line.
Reference: The Washington Post (March 14, 2013) “The rift — a family dynasty fights over the future of Luray Caverns”