ABSTRACT
This chapter examines the implications of dispersed shareholding for the financial strategies that family owners might adopt, including the implications of pruning the family ownership tree. It also examines the supply and demand of finance and provides an insight into some of the theories that help us to understand the issues and financial strategies for family businesses. The chapter assumes that the reader has a knowledge of common types of finance. The shareholders are the owners and primary investors of finance into the family business and therefore it is important to understand their rights and responsibilities in order to understand the financing of family businesses. Many of advantages of a public listing are the same for family and non-family firms, including the financial investment itself providing cash to invest in further growth and an increased profile for the business. As family businesses grow, dispersion of shareholdings can lead to increased emphasis on financial returns and weaker emotional attachment to the business.
