Siblings as business partners: Trust and commitment among top benefits

Special Report: Family Business

Dave and Ed Michalski of Pro Engineering

Last updated on July 3rd, 2019 at 01:34 pm

Dave Michalski was a senior in high school when his brother Ed started Milwaukee-based Pro Engineering & Manufacturing Inc. in 1977. As soon as he graduated, Dave joined Ed in the metal fabrication business, working together from a pickup truck with welding equipment in the back.

“He was the entrepreneur and I was the full labor force,” said Dave, now vice president of the company.

Ed, president of Pro Engineering, said the two were always close growing up, which made the transition to business easier.

“Working together wasn’t a big jump for us,” he said. “We weren’t rivals in our youth; we were complementary.”

The chemistry and relationship the pair built in the early days helped as the company grew to dozens of employees and sales across the country and around the world.

Those who work with their family members on a regular basis say there are a couple keys to staying in business together, including keeping disagreements from becoming personal and setting boundaries. The benefits of working with a brother or sister include a built-in level of commitment and willingness to work toward a common goal. 

“In the best sense, you know you can really trust each other,” said Frank Keppler, co-owner of Milwaukee-based Brew City Brand Apparel, noting an employee or high-level manager would be more likely to leave for more pay or a better opportunity. “When you really need to land something, there’s a high degree of commitment between the owners.”

Brew City Brand employee Sue Ullenberg on the production floor at the company’s Third Ward facility.

Like the Michalskis, brothers Frank and George Keppler started at Brew City Brand Apparel early in life, helping their father with his stand at The Shops of Grand Avenue mall. At the time, it was more of a summer job, but the duo would grow into roles leading the sales and creative sides of the business.

Mike and Paul Ryan of Brookfield-based contract manufacturer RSP Inc. came to work together later in life. A variety of circumstances lined up as Mike left a consulting job in Chicago in 2005 to join the company where Paul was already working.

The Ryans said initially they spent a lot of time poring over the details of a quote together before developing an idea of what the other was thinking. Now, the trust they have developed is a main benefit of working together.

“I have absolute trust that he’s here and looking out for the business and can make easy or tough decisions while I’m gone,” Mike Ryan, RSP’s chief executive officer, said of his brother.

Sisters Cassie Erato, Amanda Baltz and Katie Wessel watched their father Randy Spaulding take the entrepreneurial plunge in starting West Bend-based Spaulding Clinical Research LLC in 2007. For a time, all three siblings worked in the business. Today, Erato is chief operating officer at Spaulding Clinical, while Baltz leads Spaulding Medical, a spinoff business.

Erato and Baltz spent several years working through how to spin off Spaulding Medical. It required weekly meetings to talk through the details and a focus on non-business issues.

“The same way you would in a marriage or a friendship, instead of burying those things you have to bring them to the surface and talk though them,” Erato said.

Being willing to talk about their relationship was not enough. Baltz, Erato and their father found they needed to set time aside to avoid business issues dominating their conversations. In the beginning, they relied on a business coach to facilitate those conversations.

“Having a mediator in that situation is priceless,” Erato said.

“I think you have to be extremely intentional about working the relationship,” Baltz added.

Wessel, who started Milwaukee Pretzel Co. LLC with her husband Matt in 2014, pointed out that whether the partner is a sibling or a spouse, it is easy for the business to dominate the conversation.

“It should. It’s your whole life. It’s everything,” she said. “Of course you’re going to talk about it all the time and of course it’s going to dominate, but to be healthy you have to set boundaries.”

The division of labor can sometimes be obvious, depending on the siblings involved. At RSP, the Ryans share a lot of overlap when it comes to account management. Mike’s skills skew toward the sales side while Paul, the company’s president, leans toward operations and production.

“When a decision falls in his skillset, I’m like, ‘You make the decision,’” Mike said. “I’ll agree and we’ll discuss it. If something falls in more of my skillset, I think he feels likewise.”

The brothers said the company’s guiding principles give them a common goal so when they disagree it is likely more about how to reach that goal.

“We’ve had our missteps, but I think part of it is when you do misstep, not holding a grudge and hanging on to it,” Mike said. “It’s just like, ‘Hey, we’re both in this together. I didn’t like your decision but we did it and now we’re here and let’s move on and make the next decision.’”

For the Kepplers, the division of labor emerged organically, with George taking the lead on sales and Frank focused on product development. Over time, however, Frank said more of the workload, travel and interactions with customers fell on George, creating some tension between the two.

“We’ve tried to not lower expectations but divert them from being personal,” Frank said, noting that the first reaction is often to question why the other person did or did not do something. “We try to phrase it more about what can we do to fix that instead of going back to the past and blaming.”

Paul and Mike Ryan use giant scissors to cut the ribbon for a new facility for RSP Inc. in Brookfield in 2017.

Dave Michalski said he appreciated the fact that his brother did most of the traveling as the company grew, allowing him to stay home with his family, while Ed took his family on some trips.

“I’d come back with some harebrained ideas,” Ed said. “Dave would either go, ‘That seems pretty neat, let’s try it’ or, ‘Ed, are you out of your mind?’”

“I always felt that we had a real good balance,” Dave added. “Ed was kind of a dreamer and I was a pessimist. I think I tried to keep us grounded and moving in a common direction.”

Their relationship has evolved over the years, but there is one key to their disagreements.

“We don’t let it go personal; we don’t go there,” Dave said.

At West Allis Blue, Mark Naber, vice president, and Kari Conradt, controller, took over daily operations in 2014 from their parents after convincing their dad the company needed to invest in equipment to move into graphics and environmental branding.

Naber takes a big picture approach to things, while Conradt is detail-oriented and handles many of the business’ administrative functions.

“What’s great about our relationship is we can say what we need to say honestly and openly and it never gets brought home,” Conradt said.

Having a sibling looking after the company’s books gives Naber a level of confidence he would not have with a non-family member.

“Running a business is a stressful deal,” he said. “It gives me great comfort to be able to do it as a team with someone I trust. If I had to do it myself, I don’t know if I could do it.”

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Arthur covers banking and finance and the economy at BizTimes while also leading special projects as an associate editor. He also spent five years covering manufacturing at BizTimes. He previously was managing editor at The Waukesha Freeman. He is a graduate of Carroll University and did graduate coursework at Marquette. A native of southeastern Wisconsin, he is also a nationally certified gymnastics judge and enjoys golf on the weekends.

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