The Shady Test
Knowing what your firm stands for is a liberating experience
When Matthew and I created Benevolent, we set down our founding principles as the entirety of the minutes for our first official board meeting.
This is what we wrote:
No shady shit.
No helping assholes.
That’s it. We hopped online, registered a new LLC with the state of Florida, and wrapped the meeting.
Sorry about the language if you’re squeamish, but we feel very strongly about both points.
The first is mostly a reminder of what our company stands for. We use it occasionally between ourselves to make sure we aren’t thinking of something that we wouldn’t be proud to post on a billboard near our favorite coffee shop. We don’t consider shady shit often, but “the shady test” has proven useful a couple of times in the past eighteen months.
For instance: should the two of us take an equity stake in a portfolio company, get it in shape, and then involve our mentor-investors, thus asking them to buy in at a higher valuation? We work our tails off coaching these founders and their key employees, so that’s something we considered at one point.
But not very seriously.
But you know what? Screw it. We decided to have the investors start with the companies we bring on from the very beginning. By choosing and then nurturing founders of rock-solid, eminently scalable businesses, we’ll all prosper. Why split hairs? Our investors trust us – that’s why they signed on, at least this first batch – so we’d better never do anything we even need to hold up to “the shady test.”
The second principle, No helping assholes? That’s vitally important, too. We’ve turned away several business founders and several investors because they didn’t feel right.
We know our Wealth Engine system is going to make some people significant money, and money is power. We really don’t want to help psychopaths be more effective psychopaths. Sorry, Elon.
It’s hard to say no, I suppose. Or, I used to think so. But you know what? I’ve seen too much to be sorry about doing the right thing, even if that thing loses me a friend I don’t want to have anyway.
My mom is proud of my, my wife and kids are proud of me… yeah. I have no one left to impress.
Meanwhile, because I’m surrounding myself with people I admire, I have a richer life. Even before we talk about the returns the Benevolent funds are going to bring.
How bout you? Are you building something that can pass “the shady test?” Are you doing it with people you’d choose to spend time with even if you weren’t making each other a dime?
If not, maybe it’s time to rethink that.
In the meantime, have a great week – and if you read anything you liked, please, share this post with a person you admire.
- Ted
PS I owe you a another post or two about building your own sales engine. More on that topic soon.