You can make a family as a Parent or as a Baby and request other users to join your family.
You can start a family by clicking the orange parent and baby icon at the bottom left of the right sidebar menu on your screen.
This will bring up the family menu, prompting you to start a family. Once you're ready, press the blue "Create Family" button. 
This menu allows you to control all aspects of a family. At first, your family menu will be empty until another user joins your family.
To invite someone to your family, click on their avatar to bring up the interaction menu, and then select "Invite to family."
Once the user accepts your invite, they'll become part of your family. You'll be able to see them in your family menu. You'll spot a green "Go" button, which means you can teleport to them as needed. This is handy, as usual, to teleport to players, you would need to have them added as a friend through the friend menu; however, with this, you don't need to add anyone.
You can even change your family name to whatever you think suits your family!
Although you were the user to set up a family, there is no level of authority in a family. Therefore, you cannot kick out anyone or disband the family; your only option is to leave it. You can do this by pressing the blue "Leave Family" icon at the bottom of your family menu. This will bring up a prompt to ensure you're certain you want to leave the family. You cannot rejoin the family unless someone else invites you.