3. How does financing a fami ly business differ from f&nancing a franchise or a new start-up? Outline the Lllique challenges in each of these situations. Family businesses are a prominent feature in many countries of the world. Most family businesses are small, but some are very large. In addition to the usual challenges facing business firms, family businesses often are threatened b y disagreements between family members about how the business should be run. Here are some classic examples.

The Irving Family The Irving family of New Brunswick Is one of the great success stories of Canadian business. The company o.vns scores of businesses in oil refining, forestry, shipbuilding, food processing, publishing, transportation, and home improvement. The business was started in the nineteenth century by J.D. Irving and was expanded by his son KC. The empire is now run by K.C.'s three sons, Arthur, J.K., and Jack, who are all in their seventies. Recently, it became clear that J.K.'s son Jim and Arthur's son Kenneth were competing for a chance to shape the company's fortunes, and they disagreed over the strategic direction the company should take. That disagreement drove a wedge between J.K. and his brothers.

This is a new situation for the Irving family, which has always presented a remarkably united front. The three brothers have a great deal of respect for each other, so when these succession tensions developed, they decided they would try to amicably divide the businesses.

The energy business will go to Arthur's family, and the forestry business to J.K.'s family. Their approach contrasts sharply with what happened to the McCain family, another New Brunswick business dynasty