In widely held firms, managers often make acquisitions to create empires and maximize their utility. What does it change, when the firm is family run and the managers are members of the controlling family? Stemming from Upper Echelons theory, the aim of this paper is to understand whether and how family managers influence M&A decisions and, in turn, family firms’ performance, by considering the moderating role of past performance (objective situation). We test our hypotheses on a sample of 111 German family firms through a moderated mediation analysis. The main findings suggest that to an increasing presence of family members in TMT is related a higher propensity towards merger and acquisition activities and, in turn, better performance, especially when past performance are negative. Implications for theory and practice are also discussed.