There are two predominant family business models in operation today. The first is the custodian model. In this model, the focus is on transferring the business intact from generation to generation. The key principle on which the business operates is long-term sustainability and perpetuity from one generation to the next. There is a constant emphasis on retaining capital within the business and there is no guaranteed exit from the company.

The second model for a family business is the partnership model. In this model, the focus is on maintaining the business interests for the current generation only. There is no eye on long-term sustainability, and transferring the business to the next generation is not a concern to family members in the business. Finally, capital can be withdrawn from the business and exit is possible from the company.

Every family business needs to carefully evaluate the merits and disadvantages of both these models so that they can choose the business model that works best for their situation. Choosing either a custodian or partnership model has specific implications on the running and working of the business, which the family must carefully consider. Additionally, different generations of the family may be inclined towards operating within one of these two models. To choose a model that is best for the family, there needs to be unanimous consensus between generations in order to ensure perpetuity of the family business.