How families influence entrepreneurs’ journey

Family influence can make or break entrepreneurial dreams, shaping whether youth pursue risky startups or safer, predictable careers.

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Onsongo grew up in a prolific farming family just outside Kisii town. The family’s patriarch was the chairman of the largest local agricultural cooperative, while the matriarch championed numerous social causes in the community.

Public service, helping others, really defined how the family viewed respectability and success. Both an uncle and an aunt of Osongo’s worked in the county government.

Family reunions championed stability and predictability.
When Osongo graduated from Kisii University, he wanted to start up an agribusiness venture like his friends. However, family members advised him against it due to the risks and uncertainties involved.

They were gently guided towards a more secure path to instead get employment in a local branch of a parastatal that would come with the hope of working their way up in the organisation.

While entrepreneurship seemed exciting to Osongo, he reluctantly followed his immediate and extended family’s advice to take a safer and more predictable path rather than the rollercoaster of potential ups and downs of entrepreneurship.

Across East Africa, similar situations play out in families as youth graduating from universities and technical vocational education and training institutes or finishing incubation programmes.

A new longitudinal study published this month by Francesco Chirico, Wei Wang, and Stephen Zhang, which is getting a lot of academic attention around the world, looks at how precisely an entrepreneur’s upbringing in various types of families can shape their business startup entry and journey.

The research looked at a staggering 17,000 individuals over eight years. During that time, one of the most interesting aspects discovered involved what the researchers called family political embeddedness and how it impacts a youth’s view of risk as they enter adulthood and decide on careers.

Interestingly, when close family members of the youth were employed by large stable organisations, especially local or national government entities or parastatals, then the likelihood of that youth venturing into entrepreneurship and starting a new business venture as their primary income-generating activity reduced dramatically.

Families embedded with safe career choices transmit their preferences for stability and safety onto their children and extended family, and then hold that entrepreneurship in anything other than a side hustle rather than a main line of work is too risky and can even carry negative social costs of low success perceptions.

Surprisingly, even these safely employed families often carried significant networking and valuable connections, but the feelings of preferring safe main career choices often suppress entrepreneurial dreams and ambitions.

But there exist some interesting caveats. If politically embedded families provide other benefits to their children besides the advice surrounding stability, such as consuming more politically important news and the kids learn who in their local areas really makes decisions and their pressure points and political influencers, then the youth growing up in such environments that are additionally coupled with family discussions around government initiatives, connections, reforms, and policies mature to be more aware of how to look and fill gaps in local and national government circles.

As one can imagine, such learning over time proves extremely valuable and reverses some of the aversion to risk implanted by the safety- obsessed family growing up.

Then those entrepreneurs from this background clearly hold a social capital advantage to identify opportunities aligned with pubic policy, funding programs, and potential governmental support.

So, instead of what most people assume is the pure value of political connections that alone only go so far, entrepreneurs also need political awareness, which shifts their perceptions of business feasibility and makes them more successful.

Additionally, how a family and indeed the wider community views the efficiency of their county or the national government’s delivery in their area can influence youth career choices in politically embedded families.

When public institutions are viewed as implementing policies more fairly and consistently without as much corruption or favouritism, then young entrepreneurs are less likely to feel overwhelmed with risk perceptions and more readily and effectively jump into starting businesses.

The same actually applies to investment decisions in counties as well. But obviously, when county government performance appears erratic or opaque, then the political learning growing up loses some of its practical value as administrations change and the unwritten and written rules shift, it discourages business startup venture creation, even though they are more aware.

As we in Kenya dream of and seek a nation of more inclusive, fair growth, we must also understand how family norms, knowledge, and nepotism intersect within political systems.

We all suspect it, but have we really studied it? Over time, we pray that stability, integrity, and innovation need not be in conflict with each other.

How can non-politically embedded families ensure their children grow up with the same knowledge and linkages? When political knowledge clearly informs our local and national opportunity recognition, can our universities, TVETs, and business incubators fill in the gaps successfully so that sustainable enterprises emerge as awareness replaces both privilege and fear? Informed citizens can better ensure that effort and ingenuity will find fair grounds on which to grow and thrive. 

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