Building Your Team #1: Should I Hire My Friend? (Classic)

What's up, everyone. This is Alex Lieberman, co-founder and Executive Chairman of Morning Brew. Welcome back to Founder’s Journal, my personal audio diary where I give you, the business builder, the tools you need to think better in order to build better, whether that's building a business, a team, or a new product, It is time for our second-ever miniseries of Founder’s Journal. Here's how it works. This week, we are focused on one crucial topic in business that is important to builders, founders, and honestly all professionals. And we'll be serving you double the content to make the topic stick.

That means two episodes today, two episodes Wednesday, and two episodes Friday. The topic of this miniseries is Building Your Team. And today's episode is about whether you should work with friends or family in business. Let's hop into it. 

Don't do business with friends or family. Period. End of story. That is the first thing I wrote down when prepping for this episode. It is such a visceral reaction at this point for me. Maybe it's because my family has always given this advice to me growing up and I trust what my family says, or maybe I've simply watched and experienced too many personal relationships impacted as a result of hiring a friend or a family member, and I'm now jaded. But it's not the case that every personal-turned-work relationship is doomed. There are success stories to prove it. You have Stripe, the nearly $100 billion payments company that was started by the Collison brothers, John and Patrick. You have Eventbrite, the publicly traded event management and ticketing platform, which was started by Julia and Kevin Hartz, who were fiances when founding the business. 

The Exception to the Rule

And there's also another interesting nuance to think about here is personal-turned-work relationships also depend on the context in business. Is it your co-founder? Is it someone you're managing? Is it a friend or a family member that's in a different division of a very large company? That context really matters, but in my experience, friends or family working together has not worked out well. What I will say is be careful working with friends, period. End of story. And if you do indulge, make sure you understand how to set yourself up for success on Day One. Let's start with my own experience at Morning Brew. Since we're leading with success stories, I'll start with mine, Stacy Lieberman, or Stacy Whitman as she calls herself when on the job. That's my mom.

As some Founder’s Journal listeners know my mom is also my chief of staff. For the last two years, she has been organizing my inbox and managing my calendar. We've never had an argument about work and she has saved me one-to-two hours a day since she started. What is it about this relationship that has allowed it to work when so many other personal relationships end up failing? Two words: trust and expectation. When I was thinking about hiring an executive assistant to help manage my inbox and my calendar, I was looking for someone that had good attention to detail and someone that I could trust implicitly with sensitive information.

Now, while you can find a ton of people that have attention to detail, you can't find a ton of people that you trust with employee documentation and confidential numbers on Day One. Lucky for me, I had been building trust with my mom for the previous 28 years of life. Obviously trust was important for this role, but equally as important was expectation-setting, I made one thing very clear to my mom before she started the job: This was a job, not a hobby. If she did not do a satisfactory job and save me time, I would find someone else that could. Doing a satisfactory job meant responding to emails in my voice promptly, organizing my inbox so I never had to declare email bankruptcy, and managing my calendar so I always had one source of truth with my time. Now you're probably thinking to yourself, what sort of son says that to his mom? And the answer is, the type of son that doesn't want his personal relationship to be ruined by his work relationship, so he communicates upfront the distinction between the two. That's the one and only success story I have at Morning Brew. Now I want to talk about the other side of the coin, but first, a quick break. 

Now, back to the show, let's talk about failures in working with family and friends in business, While the circumstances have all been different, the reasons for failure have consistently been the same. It's always one of two things. First, the person isn't the perfect person for the job. Simply put, if we went out to the job market to fill that person seat, we'd be able to find someone more qualified to do the job. Or second expectations weren't set properly with the family member or friend. Now, this is a tricky one. In some cases, Morning Brew didn't set expectations properly with the person. In other cases, the person expected something different than had been communicated to them because they were a family member or friend. So basically what I'm saying is while unintentional, family and friends were treated differently than other employees. Crazy idea, right?

Nuances to Consider

It's almost like when you hire someone that you have a personal relationship with the personal relationship impacts your ability to establish an authentic work relationship. I mean, just think about how hard it would be to manage a close friend. I literally can't think of an example where that could work really well. Now, if I was a listener of my own show right now, I would a hundred percent reach out to me and be like, Alex, you can control everything you're talking about. You can set the right expectations and you can determine if someone is the right person for the job based on merit. And I would respond to them: Sure, in theory, but the distinction between making decisions with your brain and your heart is often indistinguishable.

Let me give you a few examples. Let's say you're working a full-time job in finance. You're getting paid well, but you know you want to be more creative and be your own boss. Over beers one day, your best friends from college and you are talking about some problem you both share. One thing leads to another, and you guys have a brilliant idea to solve the problem, and you get a little side hustle going. You start your side hustle and things are going great. Fast forward two years and the side hustle is starting to accelerate, you're starting to make some real money, and your best friend and yourself decided to go all in. Business is taking off, but you realize your friend just doesn't want it as badly as you do and they're working way less than you. 

This is the nuance that I'm talking about. By year two, it is evident that the co-founders and best friends aren't the right fit for one another, but when they were discussing their side hustle over beers after work, they definitely never dreamt of taking the leap and going full-time with this project. It would have never made sense in the beginning for them to say, let's not just try this random idea together. And this example that I give you, it's so specific because it's basically the story of Austin and I starting Morning Brew, had it gone wrong. We are two people that became friends, that were talking about this side hustle, this hobby to make business better for people.

Luckily we both shared very similar values. We both spent all of our time on the business, but just as easily things could have gone south and that is the example of what I just told you. 

Shortchanging Your Search Efforts

Here's one other: Let's say you're scaling a company that you already have, and you're looking to level-up your design and your branding. You have a one-off project that needs to get done, which is a brand refresh and a redesign to your website. Your sister happens to be a really talented product designer and wants to take the work on in a freelance capacity. While it gives you a little pause, you don't worry about it because it's a one-off project, so they're a freelancer and worst case scenario, if you're unhappy with it, you can always hire another designer.

Your sister works through the project and absolutely crushes it. The team is blown away by the new branding and website and see so much potential to level-up the rest of the business’s design. You end up having a full-time design position that you just started hiring for prior to working on this project with your sister, but you don't have any sort of pipeline of candidates. Your sister says she's really excited about working full-time on the brand, but she has another offer she needs to get back to in less than four days. You decide to hire her because she's proven her worth and you don't want to lose her because of timing. Did you make the right decision? I'd argue that the answer is no.

While your sister did a great job, you had just begun a hiring process, which was rushed because of your sister's timeline. You had no idea though, if there were better candidates out there that you just didn't take the time to meet. As you can see in both of these examples, family-and-friend work decisions are oftentimes complex, nuanced, and make sense in the moment but not in the future. So to bring it back to the first thing I said, I'm not going to tell you not to work with a spouse, a sibling, or a best friend. What I am going to tell you is if you end up doing so, there should be three criteria that you relentlessly consider before taking the plunge. 

Three Criteria for Working with Friends and Family

The first: Set expectations properly. They are not your friend, they are your co-founder. They are not your mother, they are your employee. It sounds inhumane, but by creating delineation of a relationship, it ensures that you are on the same page and a strong working relationship is built on a foundation of clarity and mutual respect. Number two: Ensure they are the perfect person for the role. Ask yourself: If I had three months to hire for this role, whether it's a co-founder, a first employee, or a lead engineer, could I find someone better suited for it? Unless you feel settled that the answer is a definitive no, you should take the time to see what's out there and validate your suspicions one way or another.

Third and final: Make sure that there is value alignment. Every business has values. Morning Brew has four values: curiosity, empathy, purpose, and challenger mentality. Every employee is tested on these values before they are hired into the business. A friend or family member must, and I mean must be held to the same standard. Don't just assume that the way they act in your personal life will be the way that they carry themselves in work. 

So to tie this up, here's my view: I've been burned enough times by working with friends and family that, if given the choice, I would choose not to go down that path, but that doesn't mean it's not the right path. It's just not the right path for me right now. Turning personal relationships into work relationships has proven successful for many people and it could very well prove successful for you. Just don't take this type of decision lightly, understand the risks and rewards when going into business with family and friends, and create the space for yourself to make the decision clearly and methodically. 

If you had the choice to work with your best friend, would you do it? I actually want to hear from you, so send an email to alex@morningbrew.com or DM me on Twitter @BusinessBarista with your thoughts on if you would work with a friend or family member, whether they're a co-founder, someone you're managing, or an employee in a larger business that you're both working at.

Also just remember, this is our second miniseries ever on building your team. And if you liked this episode, we have five more coming your way just like it. Finally, if you enjoyed the episode, please leave a review for Founder’s Journal on Apple Podcasts. It is the number one way to grow the show. So I'd love for you to help me and this community get to 750 reviews for the pod. Thanks so much for listening and I'll catch you next episode.