The chapter focuses on how family-controlled firms respond to economic and financial crises. Because of their longer investment horizons, families are a category of controlling blockholder whose decisions potentially differ from those of other blockholders. We use both crisis and non-crisis periods to test the behaviour of family firms in booms and busts. We exploit two exogenous shocks (the dotcom bubble and the 2001 terrorist attacks (2001-2003), and the credit and sovereign debt crisis of 2008-2010) that hit European firms to examine the response of family firms to crisis, and compare it with that of non-family firms. Family firms generally outperform non-family firms. We also find some evidence of differences in performance between the two groups during economic crises. Concerning investment decisions, family firms tend to invest less and are more prone to downsize during economic crises. Our evidence suggests that family firms adjust their investment decisions to changes in the investment opportunity set more quickly than non-family firms. Overall, our results stress the necessity of broader access to outside capital for small and medium sized firms in Europe, in particular through the establishment of a small-cap corporate bond market.