<p>This study examines how family involvement shapes entrepreneurial capability development and facilitates the transition to autonomous venture creation within a developing economy context. Focusing on family businesses in Ethiopia, the research investigates why children and extended family members initially engage in family enterprises and how they subsequently mobilize family capital to establish independent entrepreneurial ventures. Drawing on a qualitative research design, the study is based on in-depth, face-to-face interviews with twelve individuals from seven family businesses, including founders, next-generation members, and family members who exited to launch their own ventures. The findings show that early participation in family businesses serves as a critical learning context through which individuals develop entrepreneurial capabilities, business experience, and access to social and financial capital. These capabilities, combined with parental support mechanisms, culturally embedded practices such as <i>Gojjo Mewecha</i>, and resources from extended family networks, enable the transition to autonomous entrepreneurship. <i>Gojjo Mewecha</i>, a culturally embedded Ethiopian practice through which family business owners transfer assets, resources, and operational support to children and trusted extended family members, emerges as a distinctive mechanism of family capital mobilization that facilitates entrepreneurial capability deployment and venture creation. Based on these insights, the study proposes a process model that explicates key factors shaping initial family business engagement, capability development, family support mechanisms, and network mobilization in fostering independent entrepreneurial activity in a developing economy. The study contributes to entrepreneurship research by proposing a contextually informed framework explaining how entrepreneurship emerges and evolves from a family business in resource-constrained environments.</p>