Principled Entrepreneurship with Andreas Widmer: Lessons in Leadership and Humanity

Hi there, I'm Kevin Gentry, and welcome to the Going Big Podcast, where we explore the strategies and stories behind transforming your effectiveness by 10x-ing your fundraising and marketing. Each week, I'll be sitting down with some of the most influential business leaders, CEOs, and nonprofit visionaries to talk about leadership, the power of giving, and how to make a real impact. If you're ready to go big, And to elevate your organization to new heights, you're in the right place. You can find the Going Big Podcast on Spotify, iTunes, Amazon, iHeartRadio, Pandora, and YouTube. And don't forget to follow us on social media and visit our website, tenxstrategies.com, T-E-N-X strategies dot com, for some great free resources. Let's dive in. Well, welcome ladies and gentlemen to another Going Big Today's subject is about principled entrepreneurship and how that can really help you go big in a very meaningful way. And I'm so excited to have my guest today, who I think you will agree is one of the most fascinating and important people to speak on the subject of— by the conclusion of today's conversation, I think you'll agree. is a subject of extraordinary importance as well. So I'm very pleased to have with me Andreas Widmer. Andreas is an associate professor of practice and entrepreneurship at the Catholic University of America's Busch School of Business in Washington, D.C., and he's also the founder and director of the Art and Carlise Sciocca Center for Principled Entrepreneurship, Well, Andreas, welcome. Help us get started. What is principled entrepreneurship and why should we be interested in this subject?

Kevin, thanks so much for having me. It's an honor that you would invite me. I'm glad to be here. Principled entrepreneurship is actually a term that was coined by Charles Koch. And he coined that term in connection to what at the time was called MBM, market-based management. And he called it an approach of people to create more value for others, create, starting an effort to create value for others, which is increase in GDP in a sense, creating more value, more profit for others. And he never, so he started to talk about it and he keeps touching on it during his book, great book called Good Profit. And eventually I asked him if I could, and in the book, by the way, he says, I invite others to continue to develop this term and this concept. And I asked him if he would allow me to jump in and in the spirit of MBM and Good Profit to continue to develop it. And he said yes. And so we not only started the Center for Principled Entrepreneurship, but I wrote a book on the matter. And with the help of a good friend of both of ours, Art Sioka, actually took a step and developed principled entrepreneurship, which to answer your question, Kevin, has to do with creating, using your talents and creating value for others, create value for others through the skills and talents that you bring to the table in a sense, according to some principles. principle-based approach to business. And we set out 5 pillars of principled entrepreneurship and they would be loosely based on those 5 is the definition.

Oh, great. Well, I want to dig into those 5 because each one of them is really, I think, highly meaningful and consequential. But let's lay the table, set the table a little bit more for this. Andreas, first of all, even before I ask the question, who is Art Sioka and why is he important in this? I have another question first. I don't think you're an academic. You have a fascinating background as an entrepreneur, a Swiss Guard at the Vatican, which I hope we can get into as well. But if you're not an academic, how have you been a professor of principled entrepreneurship?

That's a good question. No, I'm not an academic. I don't have a PhD or a doctorate. I have a master's degree, and my master's degree is actually not, not even in business. It's in ministry. And, but my, my story is that I, as you said, I was in the Swiss Guards. I'm Swiss. I was born in a small village in Switzerland, but I came to America. I met a girl in Rome when I was, when I was serving in, in the Vatican, and I came to America for love. And I did fall in love both, you know, my wife now, 35 years, but also I love America. I really fell in love with the whole Yeah, the whole American situation. And by the grace of God, fell in with some entrepreneurs up in Boston when I went to college. And from the beginning of my career here in the United States, was able to participate in some really big inventions in technology and software and became a software entrepreneur, if you wish. of about 4 times over, either going public or selling the company. And then, of course, you know, all along collecting my experiences. Eventually, I moved into business strategy. I ran a business strategy firm. Then I did some philanthropy myself with Sir John Templeton. And then I wrote a book about my overall experience. specifically addressing— I'm a believing Christian, I'm a Catholic, and I'm a believing capitalist. I believe in the free market very much so, in the American founding. And I put the whole— I asked myself, how is one— how can one be a capitalist Christian? And the answer of that is in my first book. And I wanted to sort of answer that question for myself, and then I just share it with you all.

And well, this is how— this is great, Andreas, but I'm going to hold you on that point because I want to leave something, some more excitement for the end. I promised that you were going to be a fascinating and important speaker today, and we're just beginning to scratch the surface. So this is great. I want to hold that just for, uh, for more at the end. Let's dig in more to Art Sioka. You mentioned, uh, I got to know Art Sioka through Charles Koch, the businessman Charles Koch. You met him a different way, but who, who was he and why is he important? And then why are you at a center named for him and his wife?

Yeah, so I met Art Sioka about 15 years ago when I ran, uh, my— the consulting firm I'm— I, I, I ran back then. And a friend of ours introduced us because, because Art was frustrated that the that academia was so negative about business and was looking for ideas to change the mind of academia, of academics about business. And this friend introduced us and Art and I hit it off right away. And we came up with this idea. I'm an ideas person and practically driven, let's say. I immediately came up with an idea to create a seminar for academics to show them that business is a force for good and what it comes out of. And he loved it. And the 2 of us put a seminar together for several years for academics there in the Boston area to show them what we, why we love business and why we think it's a force for good and for excellence, human excellence. It didn't work. But what worked, we couldn't convince the academics, but we convinced each other that we became friends. And years later, I was through this book I wrote, I was approached by a university, by Catholic University of America to help them build a business school, found a business school. And I immediately started to talk to my business students about this friend of mine, Art Sioka, who I think is one of the greatest entrepreneurs of the last 70, 80 years. People don't know Most people have been affected by one of his innovations and the way he innovated in the marketplace. But most people don't know his name or even his company name, but they know brands that he promoted. So Art is, of course, the person who made Franzia, the wine company, what it is today. That brand is the second largest wine brand in the world. He's the one who made boxed wine successful. He was also in, in the '80s into wine spritzers and wine coolers, all this stuff Art had a lot to do with. And he did that. And that's really, you know, the innovations with the products is one thing. The innovation with the company, he built the 2nd largest wine company in the world by going against every convention in the industry. I can give you some examples just so that you see the key things and we can talk about his theory behind this. The key things are, Arteoka built a behemoth of a retail company because wine is, of course, a retail business by taking all sales incentives away, by having no sales quota and giving no sales incentives to his salespeople. And he was the only company in his industry who did that. And he became the 2nd largest company in the world doing this.

This is This is radical.

And I'm so— when I met him, I was so fascinated by this guy. I'm like, and, you know, I ran a strategy firm. I didn't just run any strategy firm. My strategy firm was— the Harvard Business School has a strategy firm called the Monitor Group, and they had a subsidiary that focused on uncertain markets. So we did business strategy in uncertain markets, and that was the company I ran, and I spun it out of Monitor Group, but Michael Porter was a board member in our company and shareholder and all the big Harvard professors. And, you know, I know a thing or two about business strategy. When I met Art Sioka, I kid you not, Kevin, he would run circles around these people in terms of him as a strategist. And there's no substitute for experience. And he I just, I was, became a, you know, as radical as he was, I became a radical fan once I met him.

Well, let's dig into that, Andreas. And, you know, the book that you wrote with his help, The Art of Principled Entrepreneurship, what a great title, and how to create long-term value in society. I mean, you've already said some things which are individually all radical. know, how can capitalism be a force for good? How can your Christian beliefs coincide effectively with capitalism? I thought capitalism was, uh, a situation where one party always lost and one party gained. I'm, I'm being facetious here, but you're really getting to the heart of some very important principles. But it was through somebody who, uh, approached things in just a very different way. In fact, You and I know that he wrote even a little book for his employees that was Thinking Outside the Box, which was a play on the fact that he developed boxed wine out of necessity. Hopefully we can get into that as well. But in the process, he was such a transformational figure in so many ways because more than anything, not just even developing boxed wine, but he really democratized wine consumption in the United States. He helped take it to the masses because at the time, And really, when he was getting started, it was really more attainable or accessible to people at the upper ends of the economic strata. It was not consumed as widely. So, there's so much here, but let's dive in a little bit more to the book because I think that helps us understand art and it shows an application to these principles. You mentioned 5 pillars. What's the first pillar?

Sure.

That is, I think it's something like the economy is there for the people. The people are not there to serve the economy. What in the world does that mean?

See, the core, and this goes back to Charles Koch's MBM, and sorry, they name it differently now, but I'm gonna use MBM because I started with that also in the book. Person-centered business, start with the customer in mind. end with the employee. So business is, how may I help you? So there's you and me in it. These are 2 individuals who help each other in a sense, right? And we should never forget that at the end of the day, there's a person at the center of what we're doing, not the economy, which is an abstract, right? And that's why I love this term that Art also stressed so much, that how may I help you? Because that's the core sentence that animates business and that has 2 people in it, you and me. And so we should never forget, or how do you say in English, never to miss the tree for the forest for the trees.

Yes.

That at the end of the day, you are, no matter how large your company is, you do well to remember that the individual customer who's buying your product is really the the focus of your company and the person in your company or persons in a company who create that value for them are your chief concern. And that is how Art treated business in general.

Well, that's, you know, it's amazing and a little ironic that you're teaching this in business schools because this is not taught in business school. And that's what makes Principled Entrepreneurship so special. So I think the second pillar is To work is to create and to create is to be human. All right, discuss that one.

So that's where a bit of my faith comes in and art's faith. We were all, did you ever think about that animals can't work yet animals are pretty much like us biologically, genetically? You know, a gorilla is 99.9% of my DNA. What I mean to say is that they can't work and we can work means that work has to be something above biology because we're the same biologically. The reason why the gorilla can't work and I can work is because I'm made in the image and likeness of the Creator. And my image and likeness of the Creator isn't physical because that's the image and likeness more like the gorilla, but it's spiritual. We have the Creator spirit in us. Our stewardship mandate means that we get— when we get to continue creation, we get to continue God's work, and we call that work, right? When we work, we imitate God. That's the stewardship mandate, that we continue to create the world, whether it is to clean up a room, to bring order. This is the same as God bringing order into chaos. whether it's to create a room or invent the boxed table wine, this is a godly thing that we're doing here. And when we imitate God like that, we don't just make more, we become more, because when you imitate somebody, you become more like them. And therefore, a deep Christian conviction and deep deep Christian teaching is that work is a path to holiness.

Well, this is— I said this was going to be very meaningful and very important, and you've proved me. I think you're exceeding expectations already. That's beautiful, Andreas. Well, let's take a little diversion before we get into the 3rd pillar because of what you just shared. You mentioned you were a member of the Swiss Guard. You're teaching at the Catholic University of America. You've mentioned your faith. I thought the Swiss Guard were the guys that hung out at the Vatican with the weird uniforms and the pointy shoes and things like that. How did you end up at the Vatican? And you wrote a book, I believe, even about your relationship with the Pope. Could you just share a little bit about that and how that perhaps even has some influence in this conversation?

Yeah, I, as I said, I grew up in a small village in Switzerland. I wasn't very academically gifted, let's say. I was an outdoors boy. I have 4 older brothers. The best thing I knew how to do was to fight, right? And the first thing I excelled at was the military. We have a militia in Switzerland, so everybody has to go mandatory. And there is the first time I excelled at anything. And when I learned from there that I could become a bodyguard, I felt like that's what I'm gonna do. And so I wasn't particularly religious or Catholic or anything. I mean, I mean, I was cradle Catholic, but more culturally, let's say culturally Christian. And, but I, but to the extent that I didn't mind when they told me that I would protect the Pope, I have nothing against that man. And I didn't really know much about him. But then I met him.

And which Pope was this?

John Paul II. Polish one?

Yes.

And he changed my life. Not in the way that he started to— well, he started to notice in me that I was a searching, an insecure young man, and was searching. And he started to reach out to me in a sort of individual way of just in the beginning saying things like that he appreciated that I was around, that he liked the work I did, because he was my boss. Remember, this is not he is the Pope. This is like, you know, he's the subject that I'm protecting. And so you're 24 hours around this person, you check what they do, what they eat, what they sleep, and, you know, everybody that goes there. So you get, you're close, but it's a work relationship. And he started to just say that he enjoyed working with me and that he hopes that I would grow and like, because he knew that I didn't like to be there once I figured out how hard it was and how much he appreciated to work with me, checked in with me on a regular basis, you know, whenever I was around and eventually earned my admiration through just being the most authentic human being I've ever met in my life. The man has never told me what to do ever. It is always that he was so—

what he—

how he was, was so attractive to me. that I said, I want that. But he would not take my accolades. He would, in a way, say that what I was looking for is not him, but is Christ. And he taught me how to pray. And I had, I mean, there's no two ways to say it, I had a profound experience of God through my prayer, which of course then made me— see, I wasn't an atheist, I was agnostic. It's easy to be agnostic. You're on the fence. But once you say maybe there is, maybe there isn't. Through this experience, I had to say, well, God exists, I know. And if God exists, there has to be a consequence. Like, what does this mean for me? And so I worked with him on this. By the way, his, his approach to me was always to say, you get to decide. And I cannot want for you. Like, he would never You know, this whole time that I worked with him, he's never, especially in the faith part, he's never told me what to do. He always said, you get to decide. And when I pushed, he would say, look, I cannot want for you. You have to want yourself. And he left me a changed man. Also, with my relationship to myself, of course, I was changed, of course, because he introduced me to a relationship with Jesus Christ. And when I left, he took me aside and he said, look, I know that you found Christ here. Now I need you to go and bring him where you go because I can't go there. And if you don't bring him there, then nobody else is going to bring him there. So kind of commissioned me a second time, and it took me, let's say, like 15 years to realize that I— how to do that, because I struggled with it because I was a Sunday Christian and during the week I was successful in entrepreneurship and business. And it wasn't until about the year 2000 that I started to understand how to do this. And that is when I wrote a book called The Pope and the CEO, which is why I studied ministry, by the way, because I wanted to understand the Bible better to see if I could actually reconcile my faith, Christianity, and my praxis, capitalism. And that's my— that was my answer.

Wow. Well, now we're seeing how this all comes together and what an extraordinary opportunity you had to be brought to Christ by the Pope himself. And then you're doing this work in business, in entrepreneurship, in a way that coincides with your values. It's an extension of it. So let's continue with these principles. So these pillars, the first pillar, that the economy exists for the people, not that the people exist for the economy. The second one, to create is to be human. That is what we do. Work is to create and to create is to be human. This is really coming together now. So the third pillar, how does it fit in? I think this is a Peter Drucker line, and that is strategy— excuse me, culture eats strategy for breakfast. The culture of a company is far more important than the business strategy. Okay, where does this come from and how does this fit in and how does it go back to Art Sioka and his company, the Wine Group, and the principle, the entrepreneurship approach? Yeah.

Kevin, we both, I read, I'm a devoted reader of your newsletter. And one of the things we share is that we share the admiration of some of the classic marketing and management people. And you do a brilliant job to embody them in your newsletter. And Drucker is one of those people, right? You do it with others as well, with the Four Horsemen and all that kind of stuff. But I know that many people look at this as a cliché, but that doesn't mean it's wrong. And in today's world, we don't focus on culture enough in a company. And culture is what you're doing when push comes to shove, namely when you're not purposeful and you just— nobody's looking. That's when you do what really matters to you. Art had this saying that many business people say one thing and do something else. And the doing something else speaks louder than what they're saying. And that's why there's this influx of what companies say and what they do. And underneath it all, it's actually the culture of the company is a wink wink, nod nod. We have a an HR and a policy manual that this is this thick, but the management is doing this. So we're following that. I'll give you a quick example. And he was very strongly against that. He wanted, he told me, I wrote a manual, an HR manual once when he first took over the company and it was, I don't know how thick. And he says at the end, I just threw it away. And I said, let me do this. Let me just focus on a key, few key activities of what I'm doing. There's a famous story of how You know, this is a winery and how they made vermouth as one of the side products. And 2 guys were working on boiling and on simmering and on creating the vermouth, which you have to mix some herbs and oils and stuff in it. And they spoiled a huge batch of them. I think 250,000 bottles of vermouth at a time where Art's company was 26 to 1 in debt, like he couldn't, the water was so high, one wave and he, you know, he would take in water. And so suddenly they faced this huge loss of 250,000 bottles, I think it was. And it was serious for a company to take that kind of loss. And so the team told Art, look, the vermouth isn't isn't bad. It doesn't taste that much different. It's just a bit cloudy and we could still sell it and nobody would notice. And some other people said, well, we could sell it white label and then you sell it back out the back door and at least we recover our cost. And Art turned around and says, no, destroy it. We didn't, we are artisans in this company. We do not, we say we create the best value for our customers. And that is not the best value. You know, we want to have a good price for the greatest product. This is not the greatest product.

He had— By the way, let me jump in here a minute because you do highlight this in the book, The Art of Principled Entrepreneurship. And just to be clear, as you said, he had been at Coca-Cola Bottling of New York, which owned the Franzia wine business. He was the CEO of the Franzia wine division, and Coca-Cola Bottling of New York was going to sell it. to meet the quarterly earnings profits as a public company and didn't even tell Art. And Art came to them and said, this is ridiculous. This is a— I think he said, this is a damn good company. And if you don't want it, I'll buy it. And then as he said, gee, I've got to figure out how to buy it. And he leveraged himself personally and with friends 26 to 1. He's starting this new company. He's taking it over. He faces immediately one huge critical challenge, and that is he didn't realize that as part of Coca-Cola Bottling of New York, they were getting a special discounted deal from Corning Glass on the bottles. And without that discount, he wouldn't be able to be even competitive with others. And so that's why he was forced into coming up with the concept of boxed wine, because he had to compete in the marketplace against the other big companies. So he's already in this mix of survival. And yet they come up to him, 250,000 bottles, say, look, it'll work, get it out there in the marketplace, it's okay, no one will really notice. And he says no and says these have got to be destroyed. You talk about this in the book. I've talked about this with many others, this particular story. Uh, what happened when he did that?

So see, the way he did it, and this goes to the core of who Art Sioka was that I admire so much. He says, no, dump it. So they destroy this. And the 2 guys who did this, you know, and he says, you do it, right? And so they do this. And, you know, this is in a kind of a winery, like everybody's seeing this. There's a lot of people around. And they start to work on this and they see how Art is telling them to do this. Everybody goes like, 3, 2, 1, you're fired. This is a big loss. Art said, and one more thing. You destroyed and then one more thing. The 2 of you are the only 2 people now who know what happened here. I need you to turn around and analyze what happened and come up with a solution that this never happens again. How much time do you need for this? They're like, I don't know, 2 months. He said, okay, you fix it because you now have the perspective that is unique because the others haven't seen it, how it goes bad. So instead of firing them, he put them in charge of figuring a way to say they come back to Art and promise him this will never happen again. They invented within 2 months a way to make vermouth, which is still made today with everybody else is using it today. His method which actually had to do with putting the liquid, liquefying this stuff first and then putting it in, which is, I mean, you don't need to be Albert Einstein to figure this out, but nobody ever did. And then Art sees this and instead of seeing the people as the problem, he saw those 2 guys as his solution. That takes a deep faith in humanity. To him, his employees were always a part of the solution.

Well, that, that's a great illustration of culture eating strategy. And, and, and we're gonna touch on some other things in a minute about how all of this is focused on long-term value creation, which is very difficult for most people to, to really comprehend and understand, much less apply. But it's very important to this discussion today and to our audience. And that's a great segue into the 4th pillar. And the 4th pillar is essentially that principal business creates win-win situations.

Yeah.

What? How can that be? I thought, you know, in every business deal, I'm being facetious again, tongue in cheek, that, you know, there was one winner and one loser. The person selling me, they're ripping me off. How can it be a win-win? How could it have been a win-win for the wine group to destroy the vermouth? How could it be a win-win for them to engage in these long-term partnerships? How could it be a win-win for a salesman not to get a sales commission? What— tell what's going on here, Andreas.

I tell my students all the time that one of the biggest lies that they're being told, that our society tells about capitalism, is that it is a win-lose situation, that nothing could be further from the truth in the free market. Business is a simple proposition. How may I help you? I use my talents to create value for you. In a free market, the value is measured by what you're willing to give me for the product or service that I provide to you. The difference between what it costs me to provide, to create the product, make the wine, and for you to buy it, that it's— you find it worth a certain amount. If that worth is above what I paid for it, what it cost me to make it. The difference we can call profit, but I call the difference new money because it's newly created value. Money is the transfer value that we have. We could have, you know, we would have traded chickens or something like that a few hundred years ago. But the transfer value that we have is money. And we call the difference of the transfer value, the gain in transfer value, profitability. In a free market, profitability only happens if you have a freedom to sell and a freedom to buy. And if these 2 buy— the buyer and the seller come together and they create— they have a transaction at a profit, then we can genuinely say that new profit, new value in the world has been created. And I would say new money in the world has been created. Because the amount of money in the world in a free market is never the same, not for a second. As long as people create profit by selling and buying at a value add, it constantly increases the amount of money. Along with that comes this false perception. Out of this comes this false perception that there is a certain amount of money in the world, which means the The wealth of the world is like a pizza, and the more people we have, the more slices we need to make. That is a fundamental misunderstanding of the economy. The economy is not a pizza. The economy is a pizza shop. And by having more people be able to do more business and have access, free access to do business in a free market, we can make more and more pizza. And so this whole notion of redistribution is a fallacy at the core of understanding what our system is meant to do. And that is to create win-win situations, which only happen under freedom, and thus create more and more wealth for more and more people. And I think that's the only— I've done a lot of work in emerging markets and in poverty, in prosperity creation. And that is the only way out of poverty. is to create prosperity through the free market.

All right. This is great, Andreas. So the last of the 5 pillars is always think like an entrepreneur.

Yeah, that was Art's favorite.

Well, what does that mean? I, of course, let me share with everyone. I had the tremendous opportunity and honor to work with Art. in his role as a philanthropist, especially later in life. He was very focused on ways to create value for society through initiatives in education, particularly innovative initiatives where people would find greater meaning in life. And that became a very important part of his life. But all of us who got to work with him, he would say, you know, he was big into taking risks and making bets and constant innovation. He, his favorite thing was more, better, faster, that he would say to us.

Yeah.

More, better, faster. More, better, faster. What, why did he like that? And what did he mean by always think like an entrepreneur?

He, you know, it's during the last 2 years of his life that I worked with him on this. And I feel very fraternal with you, Kevin, about this because I think you and I were the most constant, save his wife, you and I were the most constant communicators with him during his last 2 years of his life. Because he often told me about how much he talked with you. And I talked with him a lot. I recorded our conversations because he was constantly saying, I'm not gonna make it, you know, I'm at the end of my life. He was ill and he wanted me to record things so I could always finish the book without him. And he took me aside and he said at the end, one thing I want people to understand, I've met 2 kinds of people in all things I do in life, but in business, in philanthropy and everything. And he says the world is split between harvesters and creators. And to take the analogy of his— of the vineyard, he would say if I would approach the wine group or Franzia, our vineyard, as a harvester, I would ruin it in one ag cycle of 7 years. But the good wine Vineyard owner doesn't do that. The good vineyard owner doesn't focus on the harvesting. They focus actually on, on the grooming, on the creating of the vineyard, of looking at the soil and clipping and pruning and making sure that there's water. And, you know, and you get the analogy to everything, the conditions for growth and the condition for, for profit. And he says, it's deep, it's a culture, it's deep down, deep set in people that they look at the world from a creator perspective or from a harvester's perspective. And he says the key in doing good in the world and doing well in the world is to always remain a creator. And he equates the creator as we start with principle 1 as the entrepreneur.

Well, Andreas, I want to bring this to a close. This is great. And ladies and gentlemen, if you want to go big in your life with your nonprofit organization, whatever you're doing, principled entrepreneurship is a key. And I would strongly recommend Andreas's book about the art of principled entrepreneurship, which largely focuses on the work of Art Siocca. Siocca is C-I-O-C-C-A if you want to look it up.

Yeah.

father of boxed wine, but in many, many other ways, many other innovations, many other consequential actions. But Andreas, you said something earlier, and I think it's one of the most challenging of many challenging concepts to really comprehend. And that is much like a vineyard owner would look at creating long-term value because Wine, grapes are not a 1-year proposition, right? And wines are not a 1-year proposition. But he was always focused on long-term value creation, even to the point of not paying salespeople a commission for what they had earned this year. And for those involved in nonprofit fundraising, we all know at the heart you want to be focused on the long term, the long-term value creation. But it's hard to do that. And you can sometimes be focused on the immediacy of a gift right now, which slips you into a very uncomfortable place of even risking being transactional.

Yeah.

Go into this piece about how in the world did he pursue successfully this radical approach of telling his salespeople, I'm not going to pay a sales commission. I'm gonna reward you on your long-term value creation.

So I do a lot of coaching on this now with different CEOs. And this is, of course, I'm gonna go a little bit more into the abstract so that you can see how this applies to your company, be it fundraising or whatever. And the gist of what he did is this, that he says, if you know what the long— so define what long-term value creation is. Uh, with him, it was the act cycle was 7 years. So it would be somewhere out 14, 21 years that he was interested in so that there could be this, these, these life cycles, if you wish. And he would define what the, what helps that and what hinders it. And short-termism hinders it. So because you make dumb mistakes, dumb decisions, you know, and what he says is that identify the main obstacles. I'm not, for example, saying, and he wouldn't either, that everybody needs to get rid of sales quotas or something like that. It's something you have to think about. Here's the abstract I'll give you to sort of instigate your thinking. What he said, identify the key obstacles and the signal posts. It's like, you know, who was it, Cortés, who landed with the ships and the men would not leave the beach because the ship was there just in case somebody attacked, they would run back. And he says, identify the ship and then burn it. So take the one, the big cultural value that is there, that is the obstacle to your progress towards your goal of long-term value creation, and then burn it. And so what he wanted to do is to say, look, you're not here for a quarter, you're not here for a year. If you want to make money here, you have to stay here for 10 years or more. And I won't compromise on that. I would say, Art, you're gonna lose the best salespeople. And he says, not my best salespeople. Hang your values high on the flagpole and show them to everybody so clearly that you actually burn the other ship. And then you will attract the talent that will make you successful.

Well, Andreas, I'm gonna suggest something as a conclusion of all that you've shared, but it's something I also, I learned not only from Art Sioka, but from Charles Koch and working for the Koch family for many, many years, was that focus on long-term value creation. It's key to the success of Koch Industries. It's key to the success of the Wine Group. I would suggest that it is key to the success of any nonprofit organization that is working to make a difference in society. It's unlikely that you're going to solve the problem in the next couple of years. But it's easy to keep focused on the immediate things at hand, the year, raising more money this year than you did last year. And it is so clear to me that that focus on long-term value creation is what creates a win-win partnership in philanthropy.

Yeah.

Because it's not the gift, it is ultimately the partnership with the donor where you're creating true meaningful change, really getting to the root causes of problem, making a big difference. And in the process, that philanthropic partner is also finding deeper purpose and meaning in their life. You know, we have these terms sometimes in fundraising, like, well, I'm going to go shake them down or twist their arm or hit them up for a contribution. That's terrible. It's horrible. Yeah, that's, that's the win-lose proposition that we sometimes associate falsely with capitalism. It is a win-win. It's a partnership. And I'll just let you comment on that. And in doing so, perhaps also give your parting words to those that are listening and watching today. From all of this, what would you suggest to us all so that we can enjoy this creative aspect of our human condition?

Art would love these challenges of saying, and I'm enamored with this myself, I believe in creative destruction in my own organization, in my own life, to say you have to burn a few ships along the way because otherwise you might always go backwards, right? The ship was the metaphorical way to go back, to retreat and go backwards. Sometimes that's the right thing to do, but more often than not, it's just a safety blanket that makes you not move forward. Even in philanthropy, I would encourage everybody listening to say, where's that ship that you need to burn and have a debate and a discussion about it. And then I know it looks just symbolic, but you have to burn that bridge. It looked first symbolic when Art did the thing about the sales incentives and the sales quotas, but it became very real once he did burn the ship. And so once you take a position like that, yes, that is a risk. but it is also the promise of the creator, right? That you do the creation before the harvest, and the harvest is always a risk. But that's true creator behavior, is if you identify that ship and say, okay, we're not going there. Sometimes you have to put the pull versus the push, you know, and you can do that. But you get the idea of what I'm saying. What I want to say just as a parting word is there's so many things you can appreciate and follow in terms of what I Learned from Art. I have a website called andreas-widmer.com. On it, I have the first chapter of the book is there for free. And there's, I do a video about every pillar and there's all kinds of material on there. I'd be elated if you would be in touch with me to talk about this. This is what, as you can see, one of my favorite things to do. And I teach this here at the Catholic University of America at the Siocca Center, which Art and Carlise have so generously helped me fund. And yeah, and I'm also available, like I'm on social media, I engage, I love a good challenge. So if you guys have questions, you can send me something either through Kevin or also with social media, and I'd love to get engaged.

Well, Andreas, and really to our audience, you can see that Andreas and I are both very passionate about this subject because we I just truly see the win-win nature of it and the extraordinary value and the meaning that comes from it in leading in this, this way. So if you also want to check out, uh, the 10X Strategies website, my website, uh, 10xstrategies.com, I'll have this podcast there. I'll have the resources to reach Andreas. Uh, you can sign up for the free fundraising tips that Andreas referenced. We're both in this because we have such a passion for it and such a belief in it. Andreas Widmer, thank you so much for joining us. And again, I can't recommend enough, this is one of the great books, uh, The Art of Principled Entrepreneurship. You brought it out, was it last year or the year before? But recently, it's just fantastic in so many ways. And thank you for all that you're doing.

Thanks for giving me this opportunity. I really appreciate it, Ken.

Thanks for listening to the Going Big Podcast. I hope today's conversation inspired you to take your fundraising and marketing strategies to a whole new level. If you enjoyed this episode, be sure to subscribe and leave us a review on Spotify, iTunes, Amazon, iHeartRadio, Pandora, or wherever you listen to podcasts. You can also watch all of our episodes on YouTube. And don't forget to follow us on social media and visit our website, tenxstrategies.com. That's tenxstrategies.com for more great content and for free resources to help you go big with your leadership and with your giving. I'll see you on the next episode of the Going Big Podcast.