Sloan Alum Talks Perks and Perils of Family Biz
Crane Currency CEO Stephen DeFalco, SB ’83, SM ’88, recently spoke at the MIT Sloan Family Business Club about the perks and perils of joining yours or any family-run business.
Crane Currency, the centuries-old supplier of the “secret sauce” that makes up U.S. bank notes (“a blue jeans-like cotton and linen mix”), recruited DeFalco in 2011 from global life sciences company MDS, Inc. to help position the company as a major player on the global stage.
DeFalco offered a few useful pointers for anyone brave enough to get mixed up in family-style shenanigans – post business school, of course.
First things first, take note of how deep the family roots are in the business. In other words, the fewer generations tied up in the operation, the better your odds at getting involved. “When you get into third- and fourth-generations, and there are multiple cousins involved … things get complicated exponentially.”
Secondly, get your CEO sea legs elsewhere. “I think I would have failed miserably if [working at Crane] had been my first CEO experience. Learning to be a president is definitely an apprenticeship. Work yourself up to a general management role. The big consulting firms offer good development experiences and top company leadership rotations are also great.”
DeFalco elaborates on his early days at Crane Currency in which he characterized himself as a blunt and forceful presence in the boardroom. He offered an anecdote – faux pas – about pushing the board to quickly decide on an analysis he presented.
“After that meeting, the private equity guys [told me] ‘Don’t ever rush a family member into a decision that they are not ready to make. It will backfire on you.’ It was great advice, because I probably wouldn’t have gotten a unanimous board vote that day … and over time it’s really important to get unanimous board votes.”
Finally, DeFalco tells prospective students to check their egos at the door. “Don’t think that you’ve got this great MBA and now you are done.”
About the Author
Jonathan Pfeffer
Jonathan Pfeffer joined the Clear Admit and MetroMBA teams in 2015 after spending several years as an arts/culture writer, editor, and radio producer. In addition to his role as contributing writer at MetroMBA and contributing editor at Clear Admit, he is co-founder and lead producer of the Clear Admit MBA Admissions Podcast. He holds a BA in Film/Video, Ethnomusicology, and Media Studies from Oberlin College.
