Finance Starting a business for the entire clan can be messy

Alexandoy

VIP Contributor
A friend’s grandfather has given him money for capital of a business that will be registered in the name of the estate which means it is like a corporation that is owned by the clan (all the children of the grandfather that includes all the grandchildren). The business is a vegetable farm to raise fresh vegetables and to supply the market in their locality.

My friend is hesitant not because of the pandemic but with the setup. He will be paid to manage and maybe his position is president of the company. The capital is a big one that can afford to buy 5 hectares of land in the rural area. My friend loves gardening but his problem is the ownership. Until now the project is pending and he is asking for suggestions on the matter.
 

Jasmine

VIP Contributor
Community business or cooperative as it is popularly called is a business model where the business is created by community investment and the business will have a lot of owners instead of just one or two. The benefit of this type of business is that people work together to make it success.
 

Phabbyfundz

Active member
This type of business venture is a cooperate enterprise that is owned and affairs around the business are managed by a group be a clan as you mention or group of individuals with an agreement. This kind of business doesn't actually have to go bad if there is proper measures put in place to make sure that the collective interest of everyone is always checked.
 

btaliat

VIP Contributor
That is one problem that is associated with joint business. There won't be innovation of new things because most time, there may not be unity while making decision for the progress of the business. I will only advise your friends to take the ideas among others and convince them why they must do the idea.
 

Abigael

Valued Contributor
This is a great challenge that faces many joint or cooperative business. Having many owners in a company can cause conflicts at some point. I think your friend should just ensure that the clan members know that they own the business too. But he should go own with the management responsibilities that he was given.
 

Chibson

VIP Contributor
Sometimes such businesses may succeed but a lot of problems will arise in the future which will make the business to crumble. It is better I start up a business myself and manage it and then to setup a joint business buy a clan not even a family. I wouldn't advise him to put much effort on such business.
 

AaqilFaraj

New member
A community business, or cooperative as it is commonly known, is a business model in which a firm is established by community investment and has many owners rather than just one or two. The advantage of this form of business is that everyone contributes to its success. Dubai is an advantageous location for launching a new business. Many individuals aspire to start a company there.
 
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