Sparkle Collection: A Rising Generation’s Entrepreneurial Dilemma

Karen Chan was a Hong Kong second-generation leader in her family business, German Pool Hong Kong Limited (German Pool), a home appliance and furniture company founded by Karen’s father, Edward Chan. By July 2022, Karen had developed the family business and founded her own high-fashion brand, Sparkle Collection, amid ongoing disruptions in Hong Kong. Karen was an innovator of products and ideas for the family business, but her niche venture Sparkle Collection gave her an understanding of the hardship her father faced starting a new business from scratch. Social unrest in Hong Kong in 2019 and the outbreak of the COVID-19 pandemic in March 2020 had a strong impact on the economy, drastically affecting sales of premium products. Karen pivoted to make her venture survive. She also created a new strategic plan for the enterprise’s portfolio. Sparkle Collection targeted a niche artistic and cultural sector. In contrast, German Pool’s appliance and furniture business, along with its Happy Kitchen Cafe, catered to the mass market. Karen knew that it could take years of continued investment in Sparkle Collection to make it a “star” in the portfolio. She wondered if she could balance her roles as steward of the family business, while pursuing her passion as the entrepreneurial founder of Sparkle Collection. Should she continue to invest in her venture despite uncertainties in the economy and in her own future? Or should she give up on Sparkle Collection and refocus her efforts on steering German Pool’s existing business through the pandemic?

This case covers the entrepreneurial career of an accomplished second-generation leader who serves both as steward in her family’s home appliance brand and founder of her own high-fashion brand. The case traces the leader’s struggle to balance the two roles and manage change and adversity. It also highlights the importance of transgenerational entrepreneurship amid ongoing waves of disruption facing a family-owned medium-sized enterprise. As the career of a next- or rising-generation leader in a family business becomes more dynamic or boundaryless, succession is reframed in two ways. The first is to nurture both the founder’s and the successor’s identities to understand family succession in disruptive times. The second is to promote the new business venture and increase empathy among the first-generation leader and his children during the transition process. After completion of this case, students will be able to accomplish the following objectives:<br><br><ul><li>Discuss the dynamic entrepreneurial career of rising-generation members, with a focus on how they can find their own niche in the family business and how they negotiate a balance between their successor and founder identities.</li><li>Evaluate a new venture under a family business group, considering both financial and non-financial costs and benefits, emphasizing how venturing can help engage the rising-generation member to experience the hardship of the founding generation, and renew the family legacy.</li><li>Discuss the importance of perseverance when facing challenges in an ongoing disruption such as the COVID-19 pandemic.</li><li>Assess the transgenerational potential of an entrepreneurial family.</li></ul>

• Family Business
• Entrepreneurship
• Venturing
• Career