Back in 2022, when my research partner and I first interviewed Hu, a native of China’s eastern Zhejiang province, he had placed his passion for writing music on the back burner to take over the family water cup business. This year on Father’s Day, however, the nearly 30-year-old uploaded a video onto Xiaohongshu — known globally as RedNote — of him performing a song he wrote for his father on the guitar. In essence, he had taken a more prominent role in the family business, but had done it his own way: integrating his love of music into online promotions to attract new customers while launching an upgraded product line.

Since China’s first generation of private enterprises entered a critical succession stage in the mid-2010s, the question of whether or not to take over the family businesses like Hu is rocking the fate of countless private enterprises in China, which accounted for 96.4% of all businesses just last year. Zhejiang, a major business hub where we focused our research, had 2.5 million small enterprises in 2020 alone, most of which were privately owned. With roughly a decade to go until the next generation takes over, only time will tell how many enterprises stay in the family.

As the question of succession looms large, so do the reasons factoring into family inheritance. A 2014 survey indicated that only 40% of the second generation sampled across the country were willing to carry on the business.

What drives the decision to keep the business in the family? To take a closer look, we conducted interviews with Zhejiang’s chang’erdai, or “second-generation factory owners,” across several industries to see how the children of factory founders viewed the family business. We discovered that regardless of whether chang’erdai decided to take on the business or refuse it outright, intergenerational dynamics played a massive role in a difficult, sometimes fraught, choice.

“I want to be my own mountain”

Hu’s enthusiasm for taking on the family business largely comes from a healthy relationship with his parents. Though he received an international education and studied business management at university, his parents never forced him to choose between music and business. If anything, they encouraged his passion, posting his new singles to their WeChat messaging app feeds. Since taking over the family business, Hu has gained a deeper appreciation for his parents’ sacrifices as he seeks to both preserve and update the business.

However, another Zhejiang chang’erdai, Fei, developed her business awareness even earlier. From a young age, she joined her parents in various networking events organized by friends and relatives, as well as hometown and local trade associations. Like her two older brothers, she was sent abroad when she was in middle school.

“My parents believe that children should experience challenges at a young age,” Fei said. “They let me get involved in (the family business) from a young age — not to force me to take over someday, but to let me know that no matter what I did in life, it would not be easy.”

Although her parents did not explicitly ask Fei to take over the family business, she has taken an interest in business nonetheless, positioning herself as a reformer. She hopes to update family businesses, calling some of the events she joined with her parents “ineffective networking” and voicing criticism about traditional organizational methods. “I want to shape my own corporate culture myself,” she said.

What’s striking about Hu and Fei’s succession stories is how their parents went out of their way to give them nontraditional educations, pursue their own paths, and experience new environments, yet the two still reverted to the traditional model of inheriting the family business. If anything, their upbringing helped their children appreciate their devotion to the enterprise and seek to surpass what they built.

“I used to think the relationship between parent and child was like a relay race, but it’s not,” Hu said. “My dad is not my predecessor, and I am not his successor. He is not the mountain I lean upon. I want to be my own mountain.”

“I won’t be your baton”

However, not all chang’erdai see eye to eye with their parents. Some merely recall how their parents were buried in work and even accuse the family business of robbing them of their parents’ love and care.

For as long as Zhan can remember, his father was always away. He doesn’t have any fond memories of sharing a meal or going on vacation with his father, though he understands that his father’s business journey was not easy and recognizes that the business supported the family’s affluent lifestyle. He is also keenly aware of the high hopes placed on him as the eldest son.

He told us that his life revolved around trying to meet his parents’ expectations — until the summer of his sophomore year in university, when he suddenly realized he needed to live for himself. And so, upon graduating, Zhan took an exam to work at a public institution as a compliance officer in a neighboring city, extricating himself from the family network entirely.

Deciding to work “within the system” of the public sector may seem like a stable or even conservative choice, but for Zhan it was significant for many reasons. Crucially, finding this job was a way to break from his predetermined path and begin living for himself.

“(My father) thought I should follow in his footsteps and use his connections and resources to continue this line of business, make even more money, and achieve the affluent social class they wanted,” Zhan said. “I said no, I am not interested in (your) stuff whatsoever.”

Working in a respectable role also relieved Zhan’s pressure to hustle and prove himself as a high-achieving son of an entrepreneur, as is often expected of chang’erdai. If anything, Zhan was relieved to work at a more relaxed pace and avoid his father’s hectic lifestyle.

“I feel much more confident now that I’ve entered the system,” Zhan said. “I can be a proud working stiff (without any higher goals).”

The system has also alleviated Zhan’s dissatisfaction with relationship-based management. He prefers the transparency of public institutions — especially compliance — where rules and mechanisms take precedence over personal connections and can offer him what he calls “an impenetrable wall” of defense against his parents’ potential emotional or moral manipulation.

Within Zhan’s narrative on intergenerational conflict and career, we also discovered his reflections on gender. Although Zhan is considered the traditional inheritor as the eldest son, he does not identify as the eldest child because of his older sister, whom his parents sent away to be fostered until she was 3. In his opinion, the very same tradition that favors sons over daughters also burdened him with business inheritance. He did not want to be valued by his parents simply because of his gender.

In China, the baton in track and field is often used as a metaphor to represent career inheritance, but as far as Zhan is concerned, this sort of language overlooks the crux of family love. What he wants is total acceptance, not because of his ability to be a successor but “because of who I am.”

“It’s just a career option”

In our study of chang’erdai, some of our interviewees were less affected by the label — neither outright rejecting nor actively embracing the family business. This group had no obvious aversion to the family business, yet maintained a relatively healthy family dynamic. For these families, leading a healthy and happy life was more important than carrying on the business, which they saw as one option among many.

Shan comes from an affluent family that runs a construction materials business. Her elder sister has no interest in business and is now a full-time homemaker, while her younger brother is studying martial arts and aspires to become a student athlete. When we first interviewed Shan, she was doing management and design in her family’s business; by the time we returned for another interview, she had already started working elsewhere.

According to Shan, her parents never pressured her, nor did they ask any of their three children to take over the business. She takes a more pragmatic view on the family business: “Doing business or running a factory is just a career option. It’s just like finding a job in a company, or any other job: you work and then you retire.”

Zhang, who has a younger brother and sister, takes a similar stance. She told us that she did not experience much pressure as the eldest and that her parents were willing to let her do whatever best suited her, so long as she was happy. For her and her family, achieving happiness and a greater purpose in life was far more important than maintaining a profitable family business.

“Life doesn’t necessarily have to be solely about the pursuit of wealth; there are many other things to strive for,” Zhang said. “In my own family, there isn’t any particularly grand legacy. It’s just a small profitable factory, which actually frees us to pursue what we truly want to do or what genuinely suits us.”

Studies have shown that around the world, Gen Z is displaying an increasingly strong sense of self, but they also place much greater significance on family, valuing positive social feedback and the sense of spiritual fulfillment of family life. Chinese scholars have likewise observed what they call “neo-familism.”

We have noticed a similar trend in our study of chang’erdai. The younger generation has increasing self-awareness and a stronger desire for freedom and self-expression than their parents’ generation. However, no matter the response, family looms large in decisions about succession. Even those in fierce conflict with their parents, like Zhan, are still defining what “family” means to them and placing their ideal family dynamic at the core of the struggle.

It begs the question of what it would actually take to achieve true family inheritance. Perhaps if business owners abandoned the notion that their children must inherit the family business and instead paid more attention to fostering a strong emotional communication with them, the businesses might just stay in the family.

To protect the identities of my research participants, I have given them all pseudonyms.

Dong Xiaoyu, a graduate student at the School of Sociology and Political Science at Shanghai University, made an equal contribution to this article.

Translator: Hannah Lund; portrait artist: Zhou Zhen.

(Header image: Shijue/VCG)