Britain’s Hidden Champions: Uncovering the Social Impact of Family Mid-Sized Businesses
By Alfredo De Massis, Vittoria Magrelli, Bingbing Ge & Isotta Vazzoler
15 April 2026
Disclaimer: The views, thoughts, and opinions expressed in this blog post belong solely to the guest author and do not necessarily reflect the policies, position, or views of the Family Business Research Foundation.
Family businesses are everywhere in Britain. According to the Family Business Research Foundation's State of the Nation report (Cebr and FBRF, 2025), family businesses represent 93.2 per cent of all UK private sector businesses. They account for 90 per cent of firms in the primary sector, 81 per cent in construction, and 80 per cent in retail and administration — with family ownership particularly concentrated in sectors that form the backbone of local economies (DBT, 2024). Yet despite their economic ubiquity, a critical segment of this population remains poorly understood and almost entirely absent from the policy conversation: family mid-sized businesses (MSBs).
The UK Government's Mid-Sized Businesses Growth Review (BIS, 2012–14) defined MSBs primarily by turnover, ranging from £25 million to £500 million per year. For our purposes, we focus on the family-owned subset: firms with approximately 50–249 employees and a turnover in the £10–50 million range, in which one family holds at least 50 per cent of voting rights and at least one family member occupies a strategic governance or senior management role. These are not the small corner-shop family firms of popular imagination, nor the dynastic multinationals occasionally profiled in the business press. They occupy an intermediate and curiously invisible space: large enough to be significant employers and community anchors, yet small enough to remain off the radar of researchers, regulators, and policymakers alike. Crucially, they are often deeply embedded in their localities — sustaining stable employment, place-based investment, and long-term civic commitment in the communities where they operate.
This invisibility is a policy problem as much as a research problem. The UK Government has made economic growth a central ambition, and its Backing Your Business plan for small and medium-sized businesses (HM Government, 2025) signals growing recognition that firms in the missing middle may hold untapped growth potential. Yet family businesses receive scarcely a mention. This contrasts sharply with the experience of countries like Germany and Austria, where the Mittelstand — privately held, often family-owned mid-sized firms — occupies a prominent and celebrated place in economic policy and national identity.
In the UK, mid-sized businesses have long occupied what NatWest has called a 'critical middle' — sitting between SMEs and large corporates, but without the policy attention either group receives (NatWest, 2024). To address this gap, NatWest established the Mid-Market Growth Council in March 2025, backed by HM Treasury and the Department for Business and Trade (DBT), to provide a unified voice for mid-market firms and champion policies to unlock their growth potential (NatWest, 2025). Such institutional recognition is welcome, but it cannot substitute for a rigorous evidence base — one that specifically addresses the family ownership dimension.
The academic literature on family businesses has grown substantially in recent decades, but it has tended to treat MSBs as a subset of SMEs — grouping medium-sized firms together with their much smaller counterparts and overlooking the meaningful differences in how they operate, the relationships they sustain, and the contributions they make to the societies around them (De Massis & Foss, 2018). It is worth noting that the flagship academic journal in the field, Family Business Review, is a publication of the Family Firm Institute (FFI), the professional body for consultants and advisers to family businesses — an institutional alignment that may partly explain the field's tendency to focus on larger, more professionalised family firms rather than the messy, data-poor middle.
This is not merely a methodological oversight. It has real consequences. Family businesses, by virtue of their ownership structure and multi-generational outlook, are widely understood to embed themselves in their communities in distinctive ways: sustaining employment through downturns, maintaining long-term supplier relationships, and contributing to local civic and charitable life. The FBRF's research on how family businesses engage with their communities provides evidence of this, documenting the breadth and depth of place-based contributions that family firms make well beyond their immediate economic function (FBRF, 2022). From an embeddedness perspective (Granovetter, 1985), they participate in social and economic networks that extend well beyond the firm's formal boundaries, addressing broader social concerns, including unemployment, sustainability, and community cohesion.
And yet, the continuity that sustains family firms’ economic and social contributions to their communities across generations remains deeply fragile. Research has long documented the attrition: only around 30 per cent of family firms survive into the second generation, and just 10 per cent into the third (Ward, 1987; De Massis et al., 2008). It is worth noting that these figures, which derive primarily from North American studies, may not translate directly to the UK context; survival rates are likely to vary significantly by country, institutional environment, and firm size. Each ownership transition carries the potential to reshape, diminish, or altogether sever the ties between a firm and its communities.
Yet despite succession being one of the most studied topics in the family business literature (De Massis et al., 2008), we still know surprisingly little about what these transitions mean for the communities left behind — and what it costs when the thread between a family firm and its place is broken.
This is the gap our research project, Britain's Hidden Champions: The Social Effects of Family Mid-Sized Businesses, is designed to address. Supported by the Family Business Research Foundation (FBRF) and led by teams at Lancaster University, UK, and the Università G. d'Annunzio Chieti-Pescara, Italy, the project is guided by three interconnected research questions:
1. What is the distinctive social impact of mid-sized UK family firms on their communities, and how does this influence community resilience, identity, and local well-being over time?
2. How do the values, governance structures, and long-term outlook of family ownership shape the social roles and responsibilities of these firms?
3. How do ownership transitions — from family to non-family, or vice versa — affect the economic and social contributions of mid-sized firms to their communities?
These questions are empirically open and will be addressed using a mixed-methods approach. The purpose of this research is to build a rigorous, evidence-based picture of a phenomenon that has largely been taken for granted. Britain's family MSBs have been hiding in plain sight. It is time to take them seriously.
About the Authors
Vittoria Magrelli, Senior researcher, G.d'Annunzio University of Chieti Pescara
Bing Bing Ge, Lecturer, Lancaster University Management School
Alfredo De Massis, Full Professor, G.d'Annunzio University of Chieti Pescara & Lancaster University Management School
Isotta Vazzoler, Phd student, G.d'Annunzio University of Chieti Pescara
References
BIS (2012–14). Mid-sized businesses: Key facts. Department for Business, Innovation and Skills. https://www.gov.uk/government/statistics/msb-demographics
Cebr and FBRF (2025). State of the Nation: The UK Family Business Sector in 2023. Family Business Research Foundation. https://www.fbrf.org.uk/reports/state-of-the-nation-23
Department foor Business and Trade (2024). Business population estimates for the UK and regions. Department for Business and Trade.
De Massis, A., Chua, J. H., & Chrisman, J. J. (2008). “Factors preventing intra-family succession”, Family Business Review, 21(2), 183–199.
FBRF (2022). Family business and community engagement. Family Business Research Foundation. https://www.fbrf.org.uk/reports/family-business-community-engagement
Granovetter, M. (1985). “Economic action and social structure: The problem of embeddedness”. American Journal of Sociology, 91(3), 481–510.
HM Government (2025). Backing your business: Our plan for small and medium-sized businesses. https://www.gov.uk/government/publications/backing-your-business-our-plan-for-small-and-medium-sized-businesses/backing-your-business-our-plan-for-small-and-medium-sized-businesses-web-version
NatWest Group (2024). The Critical Middle Report.https://www.natwestgroup.com/news-and-insights/latest-stories/enterprise/2024/dec/mid-market-businesses-can-be-an-engine-of-growth-for-our-economy.html
NatWest Group (2025). Mid-Market Growth Council.https://www.natwestgroup.com/who-we-are/about-natwest-group/growing-together/championing-mid-sized-businesses.html
De Massis, A., & Foss, N. J. (2018). “Advancing family business research: The promise of microfoundations”, Family Business Review, 31(4), 386–396.
Ward, J. L. (1987). Keeping the family business healthy. Jossey-Bass.