What we talk about when we talk about money
Welcome entrepreneurs. I’m so glad you’re here.
Couple bits of news this week:
On Deck, the parent company of On Deck Scale, where I coach a few dozen high performing founders on scaling themselves as leaders, just closed a $20mm financing round led by Founder’s Fund and others. Details here on this exciting, and very appropriate, event. Really honored to help launch the OD Scale program, and we’re very much just getting started.
Also, if you didn’t catch it, I just released the second piece in my series on mindful leadership with Mindful Magazine this week, “How leaning into fear enabled me to make better decisions.” This piece explores how fear dictates our decisions more than we’d like to think, and walks through the most straightforward way I’ve found to neutralize this fear and make more conscious decisions.
Related, I wanted to talk this week about a topic that is often loaded with fear and emotional decisions: money. Specifically, how knowing “what we always say” about money can actually be the foundation to working with it skillfully.
Photo by Rainer Puster on Scopio.
What we talk about when we talk about money
I've always been scared I'm going to run out of money.
No matter how much I have or how quickly it comes in, when I think about money it always seems scarce, and there's always fear attached to its loss. For years, my response was to hustle and to avoid spending whenever I could. This served me well when I was stretching a $20K investment from TechStars to get my business off the ground, so I didn’t question it. My way was just how smart people dealt with money.
Then I got married, Laura and I decided to share a bank account, and I learned that my hold-on-with-a-death-grip approach was only one of many possible ways of relating to money (and a poorly adapted one in many cases). Where I saw scarcity, Laura saw abundance. I’d say “that vacation house is pretty expensive,” thinking we’d be just fine in a place half the price, and she’d reply, “that’s why we have jobs.” Her nonchalance stressed me out (and my neuroticism her), but I have to admit I’m usually glad she wins those discussions.
The same pattern played out at work. My relationship with money, well suited for bootstrapping, was a liability in scale-up mode. Just after closing our $3M Series A, we set to work on the gargantuan task of hiring 50 salespeople in six months. I spent dozens of hours trying to talk our executive team into doing all the recruiting themselves, blind to the risks of such a strategy due to my lack of experience and my fear of overspending. Thankfully, I listened to my team and we hired a full-time recruiter against my better judgement. Even though I resisted what I thought of as an extravagance at the time, once I saw the amount of effort our team put into post-hire training and onboarding I realized we probably would have hired 50 underperformers had I insisted on doing it the thrifty way. Turns out pinching pennies can have a profoundly negative impact on a team's ability to chase dollars.
Since then, I still get scared when I deal with money, but I’ve realized that my fear has more to do with my worldview than the situation itself. Over time I came to understand that my beliefs around money were simply beliefs, as opposed to being capital-T Truths, and I could see how those beliefs impacted my decisions in the moment. The fear would come, and if I reacted to it, I tended to make conservative, risk-averse decisions, regardless of the circumstances. But if I could observe it dispassionately and let myself be scared until I wasn’t anymore, my decisions afterward better reflected the person and the leader I wanted to be.
What we believe about money says much more about us than it does about money
Money doesn't grow on trees. Money is the root of all evil. Money stifles creativity. Money enables creativity. Money determines my worth.
The truth is that money is none of these things. Without all our commentary, money is mana. It's pure potential, like wizard fuel.
Money is a wonderful creation that, more than virtually anything else, gives life to our passions, our ideas, and the changes we want to make in the world. For good or ill. Without all our judgments, money is simply value. Anything more than that is on our end of the relationship. Anything else isn’t money; it’s a story we're telling ourselves.
I didn’t think about my story around money until it became a problem, but it doesn’t have to be that way. Want to learn more about your relationship to money right now? Answer the questions below (excerpted from Julia Cameron’s The Artist’s Way) as quickly as you can. Don't think, just write down the first thing that comes to mind.
People with money are...
Money makes people...
I’d have more money if I...
My dad thought money was...
My mom always thought money would...
In my family, money caused...
Money equals...
If I had money, I’d...
If I could afford it, I’d...
If I had some money, I’d...
I’m afraid that if I had money I...
Money is inherently...
Money causes people to...
Having money is not...
In order to have more money, I’d...
When I have money, I...
I think money is...
If I weren’t so cheap I’d...
People think money...
Being broke tells me...
We all bring baggage into any relationship. Your answers to these questions are the baggage that you're bringing into your relationship with money.
Noticing this is the first step. Seeing how much meaning and emotion you attach to money, and recognizing that none of it is real. The second step is becoming familiar with your own particular patterns. By analyzing the specific ways you relate to money you can begin to become familiar with the story you add to it, so that it’s easier to spot when your brain triggers it in the moment (in the same way you notice your car everywhere without trying, the moment you buy a new Volkswagen).
And then all there is to do is pay attention. If you’ve become familiar with your specific story around money, you’ll begin to notice it each time money comes up, and you can recognize it for what it is. Feeling of dread when your controller says he needs to talk with you? It’s not your cash flow making you feel that way. It’s just a story you’re telling yourself. A story that will trigger emotional decisions if you’re not paying attention.
It’s mental machinery. Once you notice it as such, then you can practice letting it run its course. Let it be there, let it be ok. Let it be ok that you’re scared of running out of money. Feel what that feels like, to be scared. And then watch how quickly those feelings subside, your neocortex comes back online, and you can choose consciously how to proceed.
Founders must make important money-related decisions every day. Making them well requires evaluating the money-related situation itself, rather than the story we’re telling ourselves about it. The key is knowing the difference.
(HT: Julie, Soma, John, Sterling, Blake, Sonnie, Shreedhar, Mindy and Compound for editing!)
FIVE THINGS I READ THIS WEEK
One: Sports meant so much to me. Why wouldn’t my son play? (NYT)
As the father to two boys and a lifelong fanatical athlete, this is exactly the issue I’m wrestling with right now. I lived and breathed sports, and my son would rather build forts. It’s easy to look at this as a problem to solve, even though I know that’s not what’s best for him. The author of this piece was vulnerable, and after reading it I feel very seen.
Two: Why sleep is the mate of death (Astral Codex Ten)
TIL that clinically depressed people feel better as the day goes on, up to and including pulling all-nighters. Then they go to sleep and feel bad again. This article examines the latest research as to how our brain’s self-regulation functions use sleep to perpetuate our “normal” mood. Really interesting.
Three: Psychological safety and the critical role of leadership development (McKinsey)
Research continues to trickle into the business world about the benefits of psychological safety to team performance, this article being the latest in a long list. If you’re in a leadership position and psychological safety isn’t near the top of your list of priorities, you’re doing it wrong.
Four: The parable of the Sadhu (HBR)
On a 60day journey through the Himalayas, two hikers “helped” a nearly-naked Sadhu they found lying in the snow. “I feel that what happened with the sadhu is a good example of the breakdown between the individual ethic and the corporate ethic. No one person was willing to assume ultimate responsibility for the sadhu. Each was willing to do his bit just so long as it was not too inconvenient. When it got to be a bother, everyone just passed the buck to someone else and took off.”
Five: Hamnet (Maggie O’Farrell)
I’m currently reading this historical-fictional account of the life of Shakespeare’s eldest son as a part of my decade-running book club. Maybe because we’ve been reading non-fiction for about a year and I was jonesing for a good story, or maybe simply because of the electric prose, I find that the world disappears every time I sit down to read this book. (Important note: Hamnet and Hamlet were like Bob and Rob in Shakespeare’s day.)
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