Feb 21, 2020

All In The Family

By Ed Goldman

We’re like family here!” is the second most popular cliché I hear when writing about a company’s culture.  (The all-time champion remains, “We believe in giving back to the community.” This always sounds to me as though the company is admitting to having burglarized something from the community at one time.)  

But what if the employees weren’t being hyperbolic about that ”we’re like family” characterization (or baloney, depending on your point of view and workplace experience)? What happens if they were actually related by blood or marriage to the people they worked around all day?  

Family businesses come with some wondrous elements and some troublesome ones.  In my column of 12-20-19, I lamented the fact that my own family had no family business for me to go into. I mentioned a longtime friend of mine, Robert Rivinius, who founded the Family Business Association of California nine years ago and has been its only executive director. He’s the star of today’s column.

For 30 years, Rivinius was the chief executive officer of the California Building Association, which is how I met him. He was my late wife Jane’s boss for the five years she served as the group‘s vice president for communications—a job she left after delivering our baby, who turns 34 at the end of March.

“Thirty percent of family-owned businesses make it to the second generation and about 15 percent make it to the third generation,” he says. “But only 3 to 4 percent make it to the fourth generation”

Rivinius is now 75 years old but you would be hard-pressed to guess that. He has a lively walk, full head of hair and a reassuring radio-ready voice. Over lunch at the historic Sutter Club in downtown Sacramento, he arrives brimming with facts and figures about family businesses—“There are 1.4 million in California, accounting for seven million employees,” he dutifully reports—but then throws me a curveball when I ask him why a guy with his executive background would have aligned himself with family businesses.

“Well, hell, I grew up in a family business,” he says, with a slightly elevated eyebrow I infer to mean I should have known that. In fact, Rivinius’s grandfather was a North Dakota homesteader and wheat farmer who also had a car repair business (I guess wheat growing comes with some off hours while you’re waiting for it to, you know, grow). He moved to Lodi in the hope of gradually becoming what Rivinius calls a “vineyardist” (a charming term that may have been coined as far back as 1848, two years before California became a state). “He found three properties in Escalon and planted 22 acres of walnuts,” he recalls, “and started Rivinius & Sons, Growers and Shippers.”

Bob grew up helping out in the business  but found his way to Sacramento State, which he still supports as a distinguished alum. He holds a degree in business administration.

The need for a group like the Family Business Association of California is evident. “Thirty percent of family-owned businesses make it to the second generation and about 15 percent make it to the third generation,” he says. “But only 3 to 4 percent of family businesses make it to the fourth generation.

“We want to improve that statistic,” he continues, “so we recruit members and lobby elected leaders to make sure succeeding generations aren’t penalized in inheritance taxes and so forth.” He says the association “knows it won’t be growing by leaps and bounds, but we’re very happy to grow steadily.” One way Rivinius makes membership attractive, certainly to my mind, is that his board of directors meets monthly “mainly by phone” and each meeting lasts no longer than 45 minutes.” He grins.  “I mean, these people have a business to get back to running.”

Members of the association, a 501(c)(6) not-for-profit California corporation, pay annual dues based on size, ranging from  $250 per year for a small business to $5,000 for a company with more than $100 million in annual revenue. The group also has a sponsorship program for people and companies that aren’t family businesses but want to work with them. The details are at the association’s website.

FBA’s membership runs both the gamut and the state: from the prolifically successful AKT Development, Inc., in Sacramento, to Shubert’s Ice Cream and Candy in Chico; from Pini Hardware in Novato to Shepard Bros., Inc. in La Habra; and from Lloyd Pest Control in San Diego to Pacific Coast Building Products in Rancho Cordova; from—

Well, you get the idea. The businesses are varied and spread out, united by the common corporate (and nonprofit) need for succession planning, though in the case of a family business, the insider fights have more potential for lingering resentments. 

In one case I’m familiar with, the seemingly less-likely successor to the company’s president, who was in turn the son of its founder, was his daughter, who bypassed siblings and cousins to assume the reins of a company, Nor-Cal Beverage Co., that has grown almost exponentially since Shannon Deary-Bell, now 53, succeeded her dad, the late Don Deary. I recently asked her if, after more than eight years at the helm, she encounters any hard feelings from her relatives. “Of course not,” she says. “Everyone’s pulled together fabulously.” As families can.

Ed Goldman's column appears almost every Monday, Wednesday and Friday. A former daily columnist for the Sacramento Business Journal, as well as monthly columnist for Sacramento Magazine and Comstock’s Business Magazine, he’s the author of five books, two plays and one musical (so far).