The writing is on the wall, but will ExxonMobil read it this time?
I’ve talked about groupthink and its corrosive effect on the venture capital industry, but the recent “monumental” takeover at ExxonMobil by a tiny hedge fund is certainly in this same vein. Engine №1 — the plucky little hedge fund that could — now controls 0.02% of ExxonMobil because CEO Darren Woods dismissed the ample warnings until it was too late. …
“Do not pay attention to what people say, only to what they do, and to how much of their necks they are putting on the line” — Nassim Taleb, Skin in the Game.
Leadership is more than flying around on company-owned jets or prancing into a corner office wearing an expensive suit. Accepting a leadership position means accepting a social contract to gobble up the most risk, work the hardest and make the most sacrifices. Giddy up!
Own your choices
In 1981, a Harvard Law professor suggested a simple solution to handling the Presidential nuclear codes: storing them inside the…
Employers, employees — unite!
Blood and sand
An ancient Greek wrestling school required participants entering to ‘strip or retire’ because spectators weren’t welcome. You were in the ring or out the door. The person who risked nothing and owned no downside was perceived as shameless, dangerous and dishonorable. The absence of consequences stripped someone’s credibility to the point where they were generally laughing stocks whose opinions were ignored — I mean, come on — who’s going to take the guy full of hot air seriously? Certainly no one in ancient Greece or Rome.
Jack Bogle was known as the “Father of Passive Investing”, but upon his death in 2019, he lamented his creation, as it later swung deeply into ETF territory. In fact, his disdain for ETFs was such that he even referred to the folks who traded them as “fruitcakes, nut cases and lunatic fringe.” Tell us how you really feel, Jack!
The road to hell is paved with good intentions
When Bogle created index funds in 1975, he aspired to offer retail investors a cheaper option to get off the sidelines to join the pros in the game. His pioneering model…
I know this may sound like an oxymoron, but hear me out. Collaborating with competitors is the way of the future because it can often be a boon for all parties involved. Think about it: if two companies are working towards the same goal, wouldn’t it logically make sense for them to pool their resources and get there faster? Yes, and let’s find out why.
Uniting against a common enemy isn’t just for the military — companies do it too. Microsoft and Intel got their computing technologies into our homes by changing their competitive tactics to expand the pie and…
Being the default feels splendid because *gestures everywhere* life is tailored to your comfort, taste and priorities. Technology, cosmetics, professional industries, and even government structures are created with an ‘average’ consumer/user in mind. Now, don’t get me wrong. Being the norm while recovering from laser eye surgery, for example, is a gift; but not so much when it comes to radical innovation. Creativity and meaningful ingenuity stem from the outliers.
A royal rumble
Frank Sinatra and Prince were both cultural forces and came to be known as strong solo male singers, but Prince was a true artist. He played multiple…
As Gordon Ramsey has been known to say, “thank f*ck for that”
It’s a fluke that one of the richest companies on the planet happens to be headquartered in Seattle. Microsoft was founded in New Mexico and moved to Washington because of Paul Allen. Allen wanted to live closer to his family in Seattle, where Bill Gates also hailed from, so the pair packed up shop and headed back home to the Pacific Northwest. This decision changed the course of history and technology forever.
Everyday we navigate a sea of incentives in the form of sales commission, hourly wages, stock options, tax rebates, buy-one-get-one-free sales and so much more. When it comes to altering people’s behavior, logic can only get you so far. Incentives and punishment can promote social cooperation, protect the public and discourage ethically dubious actions within the marketplace. Good rules create a code of conduct that keeps systems running smoothly, but once humans are added into the mix, unintended consequences may arise.
The complexities of human nature
An example from Harvard Business Review, outlines a daycare with a persistent tardy parent…
The financial industry has been in flux since the pandemic shuttered small businesses and pushed millions of Americans into unemployment, during the spring of 2020. This instability has threatened venture capital’s dominance and shifted focus to broader and more benevolent sources of funding, such as equity crowdfunding.
Investors in this economy can’t necessarily afford to roll the dice on more expensive unicorns, which should dial down the so-called ‘disruption’, allowing creative entrepreneurs and truly radical innovations a place in the spotlight.
Crowdfunding offers an inclusive environment where entrepreneurs are judged by the merit of their ideas, as opposed to their…
Since humanity’s early days in Mesopotamia, managing risk has been a necessary part of life. As I wrote in this previous post, Hammurabi’s Code was the first set of comprehensive rules for finance, so the concept of skin-in-the-game is nothing new. Rather, this concept has been watered down, and the once-level equilibrium is off-kilter. Author of “The Black Swan,” Nassim Nicholas Taleb, has what may be the most egalitarian and pragmatic view on the often misunderstood concept. Taleb’s version of skin-in-the-game boils down to a simple equation: you own it if you break it. Achieving this means equal consequences whether…
Business Management & Financial Services Consultant Focused on Development Stage Companies & Microcap Markets