The Tyranny of Shareholder Returns

When Hillary Clinton recently took aim at hit-and-run activist investors, hedge-funder Donald Drapkin retorted that “Management forgets that shareholders own the company.” This is legally true, but conceptually problematic. Short term investors really own an abstract object, which I’ll call a chit. They think the chit will go up or down, and they either invest… Continue reading

Playdoh and Silly Putty

Why do we like working with our hands so much? What is it about making something tactile, that gets the brain engaged? Whenever there is a complex decision to be made, and usually nothing is more hairy than prioritization debates, I like writing things out on index cards (one item per card, bonus if I… Continue reading

Upside and Downside

Heidi Roizen has yet another great post this week: “How to Build a Unicorn from Scratch – and Walk Away With Nothing.” Every budding entrepreneur should read it. Her post isn’t just about valuations and terms. It is also about thinking through downside. In frothy times, especially when equity starts to feel more valuable than cash… Continue reading

Slack’s Success and Silos vs Teams

(Note: I’m going to leave the original post as-is, but I don’t think I wrote it very well, so see the addendums to prevent misunderstandings. Maybe. This is the Internet after all.) I read a blog post today that shocked me. A design agency taking credit for their client’s success. Which was surprising unto itself… Continue reading

The challenge of a hedging model

A couple days ago, I wrote about entrepreneurship and some level of partial hedging. Actually solving that challenge is, of course, enormously difficult. So much so, that I think it might only really be doable when companies are just starting out, and the equity is worthless. I can see it working in a startup studio… Continue reading

The Stupidity of Entrepreneurs

I was hanging out tonight with a bright young man who said, “A great entrepreneur always bets on themselves.” Context: we were talking about hedging. I asked the question: what if founders could hedge themselves against other startups so that if your company failed, you still had a chance for upside? He disagreed. He felt… Continue reading