Complexity Is Quietly Destroying Enterprise Value | Founder’s Office™ Lunch & Learn

It's Wednesday and it's Lunch and Learn, and I'm so glad to be here. And joining me, of course, I'm Tom Powell. If you didn't know that, then I've been hiding underneath a rock in your world, and that's okay. Joining me also today is Candace Powell, sitting in the lovely library. Is this the— this is the location for the most recent WTF, I think?

It is.

Yeah.

Yeah.

My library.

I love that. And that show is doing exceptionally well.

Thank you.

Must be the advertisers, right?

It must be our sponsor and our two-time guest.

Twice. How many times till I get the green jacket?

Five. Five timer. Okay. All right.

Sorry.

All right.

And it's like a hoodie. It's WPF. You don't get a jacket.

I like it.

I like it.

And, uh, joining me is my newest producer in the area of, uh, the Powell Perspective that's coming out. You guys will not believe when you hire a doctor to put together a podcast studio for you what you end up getting, which is like the most amazing thing in the world with, uh, uh, Katie Powell. Dr. Katie Powell. Huh?

You get a dissertation.

Yeah, I mean, you get, you get told when and where to be. I mean, do you regret it? Not at all.

Not at all. When does the Powell Perspective start coming out? You said there's the first 5. What's the launch date?

Yeah, we're launching in just a couple of weeks. I think next week we'll be able to share with folks here and all around our networks when this super exciting podcast will be launched. I will do kind of a personal plug here as the producer, which I'm adding on my resume because this is a whole new world. But if you don't like it, it's not my fault. That's, you know, but—

No, it's definitely the talent on that for not liking it, right?

But I will say, like, there's, there's just a piece I often don't bridge into, like, the, the daughter anchor of the relationship here, especially publicly. But it has been a privilege to do this with you because most of the Powell Perspective is really extracting Your thoughts and your experience so people can learn from it. And I know Candace and I get that privilege from you, but even so, listening to these stories has just made me invigorated to do bigger and better things, inspired. And then I'm sitting here going, well, of course I'm completely biased.

But then even our editor is like, oh my God, that story!

I just never knew that about Tom. And so I think I think I share this one because I'm super grateful to be doing it. I never thought I'd get in the. production space, nor do I wish to be in it for too long. We need professionals. But it's also— it's— I'm just so excited for other people to get to see these— this side of you, get to hear those stories. So looking forward to it. Can't wait to share it with you all. And then now everyone will get kind of 2 flavors, right? You'll get the Jackie and Candace wonderfulness, and you'll get the Tom wonderfulness. And I think— Just like So, so, so exciting. So exciting things coming, but we'll have more details to share in the next week.

And we are going to get into real Lunch and Learn stuff, but thank you so much for that compliment. It has been fun. It's been exciting to watch because the whole team's come together and, and it, at the end of the day, we've got just a very nice podcast studio with multiple positions and everything. Although I'm going to miss my library down here tremendously, although they took about half my books from this library, which is one of my 3 libraries, and moved them upstairs. But it's great. It looks beautiful, and apparently the sound is amazing. So that's all. That's all cool stuff.

As a producer, I can create sound effects when so when Dad makes a bad joke, it can be like wah wah pew pew pew. It's very. We've leveled up. Yes, very cool.

This is the.

You have like the applause.

I do.

This is fantastic. This is what I got for saying I wanted to be like Jon Stewart, right? So, there we go. This is awesome. Anyway, I wanted to shout one more thing out there. This is the family office version, I think, that we're talking about today. And we see a lot of things that come up. And I had a good pleasure of meeting with one of our founders this morning that we have helped along the way with advice and committed that we would make an investment in his company. And he's giving me the update this morning. And I shared with him a LinkedIn that pissed me off earlier this week, and Candace knows which one it is. I think, Katie, you probably know as well. But it was a— it was not produced by the founder. It was not produced by the person who put the money in. But it was that a founder was dissing on an early-stage investor that put $5,000 into a company that later went on apparently to become a multimillion-dollar valuation. And he was like, this person's living on the heels of our success. And I don't know this founder. I don't know the rest of the story. It could have been all mock in there, but it just hit me so wrong because in the early stage— and I know a lot of people are on here looking at raising capital— at the early stage, every single one of those checks are critically important.

Wow.

And they usually take you— and Candice and I know this, right? I mean, from the early stage, Katie wasn't always with us at the times that we've done that. But when you're raising capital, it's sometimes just the confidence of the person That puts it in, that gets you to the next stage. And so, it's an amazing scenario. But so, this person said this $5,000, and they've put on there that they were a seed round for me, and that's just not right. And I just laid into it. And I'm like, that $5,000 might have been a month's salary for someone. It might have been the printer that you needed to be able to make something. And—

It got you to the next stage.

Mm-hmm.

Thing that you needed. I think it's so— we see it on both sides too. We see founders who don't want to talk about— they only want to talk about their big wins. And those little wins, those little hurdles that you had to overcome is what got you to that next big thing. That $5,000 was somebody betting $5,000 on you. Don't discount that. That is huge. That's huge.

No, I just, I, I just, I, you know, I oftentimes think about in the tithing circle that the church, you know, oftentimes just loves the people, of course, that writes the big checks. And we've definitely done that at different times. However, when we've written small checks, it's usually much more painful to me to write the small checks when we were in those positions, because it's like, well, this is all I got. So it's, it's going in there. Katie, you're reading a book right now by Catherine Ponder, right? Which I had said, which came out in what, in the '70s?

Yeah.

Yeah.

Yeah. So, and it's very much on that principle. I would also say too, there's a psychological component of sometimes even those small things are the wins, right? It's the momentum builder. Like there's, there's just, there's, there's such purpose to these things that I think we've all experienced it of like, I kind of, I just need a signal of a win.

Yeah.

And I think that that serves a good purpose.

Well, so this, I do have a kind of, we were talking through these different things and I've got a speech at Genius next week. And so we're talking through what that's going to be on. It's going to be on the Founder's Isolation Paradox, but it's really in our work, what we're helping founders do. Uh, and for a lot of the founders, again, that are early stage and raising the capital, or they're even mid-stage and raising the capital, they're not necessarily thinking about this, but it's the value multiplier, which is where founders are sitting there and we need to get them extracted out of the company's dependence on being a business. That does not mean getting the founder out of there as the creativity. And I think Steve Jobs is a great example of that. When you take his creativity out of Apple, you get this behemoth of a business, but it's not that creative. I really don't like the Apple products all that much anymore. Siri and I have a serious, serious dislike for each other. And they certainly, I don't know where that's ever gonna go. That's one side of it. But the second part of that was, and this was through conversations, we said, you know what? We also help really happen is we help the founder be less dependent on the company. And that, so a lot of times founders think they need to have an exit, that big win to be less dependent on, or their paychecks are so big that they also still are extremely dependent on the success of that company. So, they're doing all the various things that are going on along with that. piece that goes there. And so, The Founder's Isolation Paradox is about how we extract the company from the founder and how we extract the founder from the company. And so, that led me to one more story this weekend that I was just so proud of. And she's going to giggle about it. But Candace is a marvelous mom teaching these lessons all the time. And her and my grandchildren may not think so all the time.

Well, there's different moms. There's fun mom and there's There's Restaurant Mom. There's Restaurant Mom, not the fave.

Yeah, uh, those are the funny ones. So you gotta tell— I'm gonna jump to the end of the story, but just say Scout, a 9-year-old, wants now the teenager bed because she just went— I mean, she's all about being a teenager. She's a— what's it called? Tween? What's it called? Preteen. Preteen. Yeah.

Yes, she found out that 9 means you're a preteen, and so she wanted a new bed. And so, I—

What's that communication within that house? You know, like, I want a new bed.

Yeah, I don't— shockingly, I don't just jump and do all the—

get it done.

They live in a massive house. Why don't you just buy them what they want?

They do. Yeah, they have a pretty lovely life. And I do. I mean, they do end up getting a lot of the things that they want, but it has I don't want to say it has strings attached, but there's a lesson in it. I wonder where I got that from.

I don't know where you learned that scenario.

Anything without it being a lesson. But, I also struggle with— I love sustainability. I love projects. I really enjoy doing rehab projects on things.

So, But, you also love teaching them too.

I do. I do love teaching them. I don't love buying cheap— and you can spend a lot of money and still get cheap furniture. And so, yeah, it was funny because I had them doing the math this weekend.

This is a 5- and a 9-year-old?

Yeah, they were doing the math. We were doing kind of a cost-benefit analysis. What needs versus wants. And then, really looking at like, okay, I can buy a bed for several hundred dollars. It'll be made out of pretty cheap product.

Pressboard, shit.

Yeah, it's terrible. I can't do anything with that. I was like, once it's here, we put it together, it's probably not going to be great quality even though it costs a lot of money and shipping to get here. I can't modify that. I can't cut into it because it crumbles. It's terrible. So, I convinced her we should buy a wooden bed that I found on Facebook Marketplace for $100. And, I'm like, I can't even buy the lumber to build this, let alone my time to build this bed for $100. So, this is a good trade-off. And, she hated it. She was like, it's hideous. And, I'm like, I know, but we are creatives. We can make this magical. And so, it was great. I taught her how to use a sprayer. I love those types of projects. I love my Especially my daughters knowing that they can do anything, that they can be in the spaces, that they, they can walk into a hardware store and they belong there. And so it was just a really good, yeah. Yeah.

I think when you're a kid—

So you're gonna tie this all back. Let's see this. Let's see you work some magic on this.

Well, first of all, it is the fact that you not only get to be a founder and an entrepreneur and have the show and all the things, but you get to be able to do the things that you also want to do, which is spending your time. And you said that along the line, right? And so our founder's office and our parent company of what is our family office has allowed those kind of benefits to the family, which is— that's where the wealth and the opportunities and the creativity and even the back to the Catherine Ponder, how do you want to live the life? Trading time for money is a really bad outcome. Okay. Because it gets this kind of cyclical and all of us have had jobs, by the way. So, everybody, every one of us, and oftentimes, we've also had businesses that we just made no money at that was even worse than having a job.

Cost us money.

Cost us money. A lot of that.

I did a really good job losing money at jobs, at businesses.

Absolutely. Absolutely.

Like all good founders.

Yeah. Like all good founders. Well, Katie, Katie, we were recording one, right? And we're like, I'm leaving the bank and I think I'm the fair-haired, you know, golden child and I can't touch anything that's wrong. And I'm in my 20s. I've made a gazillion dollars early in the late '80s, early '90s. And so I can't do anything wrong. Everything I touch is gold, right? And I fail miserably to where I've got to make my mortgage payment and I'm working as a waiter. in a Thai food, right? So, I can start my next business. But I needed to make sure that your brother, your baby brother, Katie's bigger brother, older brother, was, you know, he needed diapers and he needed formula and he needed all those different things. And I can't remember what you were doing. You were like 4 or 5, I think, at the time. But—

I had my first business.

Yeah. She was starting her first business. Yeah. She wasn't adding any value to the economic side of the house yet. I was trying to figure out how to make that work.

You nailed it. Well, I think too, it's too easy for my kids to just ask and receive. And I think that's not nourishing that founder mindset of figuring out how— there's something about problem-solving. I love when we make a mistake and my kids see me make mistakes. I don't hide it from them. And I mean, if you ask them, they probably would say, Mom swears a lot during these projects because it's Super true. I, you know, they see me get frustrated, and then I have to sit there, and I have to, and it might to it's a small project, you know, relative. But those muscles that you're working are the founder muscles, right? And I hopefully am helping them develop those those skills because like you said, you just you you thought everything turned to gold, and then if it's not gold, if it turned to coal for a little bit there, and you don't have the muscles. to problem solve and work your way through these complexities, um, it doesn't— you can't turn it around. You can't steer that ship around if you don't have the skills.

I know I have a good tie-in for what you just said, Ken, for like, you're the founder of your family. Let's say you and my lovely brother-in-law Steve, but you are the founder. And I think when we think about complexity, right, what you're doing with the girls, um, who are The most amazing, sweetest ladies in the whole world, a very unbiased opinion here, is you're helping teach them how to think like a founder, even though they're not the founder of the family, right?

Mm-hmm.

Like, it could have been easier. So something that you triggered for me there is like, it was easier for both you in terms of time and them in terms of effort to go, Mom, I want this bed, give me the cash. And think about employees like that. Think about like, hey, I need this money, please. And what you're doing is teaching that resourcefulness. And I think when we think about founder complexity, often the complexity comes because it's, it's those decisions between, do I add complexity on myself to teach the team how to work like this and be more resourceful and scrappy and come to me with better refined solutions? Or am I just going to pay because I just, I'm so overwhelmed, right? Am I going to outsource that task? Am I going to add a new team member? Am I going to do all of these things? And sometimes the trade-off is additional complexity, right? That's unforeseen in the long term. And so, I just, I think what you said was so true of an employee parallel for me. We can't just have employees come. I think the imperative for founders is to help them Take that ownership as well.

Way to bring it home, Dr. Katie. For those of you that don't know, Dr. Katie is in the house.

Way to take Dad's total side journey and be like, "Let me bring this home for everyone." Here's the thing though: I feel like you guys are already there, and then it just takes me a while to catch up to be like, "Ah, this is why that matters." Because you guys are constantly thinking founder. And I oftentimes, I feel like, you know, a founder is someone who's passionate about something and they started it. And then sometimes business just kind of gets in the way of that.

I think there's 2 layers to that complexity, and we've seen both founders, okay? And I think it takes a person to internalize which founder they are, right? There's the founder who takes on the complexity for Not the right reasons. They don't trust anybody. They're doing something shady, and so they really can't have anybody else involved. They—

Well, we've had that one.

We've had that one. They think they're smarter than everyone.

They usually go together.

No one else could ever do this. I have to do this myself. So there's Multiple reasons. I don't think that's everyone. And I hope nobody on here is like, oh, God. I have been that person. I have taken it on because I'm just like, nobody else could possibly do this. Like, I must.

Or like, they don't— I have too much to lose. How could I possibly trust somebody to care?

Yes. Or they feel like, no, I must do it because that's what makes me the founder. I have to do all the things. I must know this whole process. So there's taking on that complexity because of pride.

Right?

Then there's taking on the complexity, like you said, of I'm taking on the extra job because I am taking on the job of educating now everyone on how to do this. It is like my, my, my kids did laundry starting at about 2, which I do— like, I want to say that's— they, they like moved things from— it took an hour. Okay, it took an hour for a 2-year-old because they are distracted. I could easily have done the laundry in that time, like multiple times over. It was so painful to watch a 2-year-old move every single tiny sock and then get distracted by the sock and like, oh my God, oh, it's a Bluey sock. I mean, and move it into the dryer.

That was a complexity. Katie does remember this of doing this with the dishwasher. Yes.

But that was a complexity I took on. Because now my kids can do it independently. They know I just say, start your laundry. They can do it. Did I have to start it too? Probably not. I probably made it way harder for myself. But there was a complexity I took with a long game in mind. And so there's layers to complexity. And sometimes we at the Founder's Office have to break through what those layers of complexity are. And it's not usually a one-size-fits-all. fits every situation. There are situations where it's like, I've been doing this so long, I can't possibly share, I can't possibly pass this on. There's complexity of trust, all in the same founder, right? And so, being able to identify those complexities and figuring out where you've now assigned yourself a whole bunch of jobs is a really important part of the process.

Well, it is. And, you know, I think it's one, I love watching it. So I love watching it as a dad. I also love watching it in, in what we do because I've said it for most of my life that I don't live a balanced life. I live an integrated life. And you guys have seen that. And sometimes it gets way too integrated and sometimes I make myself too busy. And, you know, I find out that just because I can doesn't mean I should, uh, type scenario. Or maybe I can't and I still do. And then that creates a big mess that we got to all clean up.

Um, I do have to get on board with whatever the hell your new hobby is.

Whatever that is. I was talking to your aunt today about my latest hobby, uh, taking on this mountain that, uh, I'm doing, and she's like, okay.

Remember when Dad was really into cycling and just started signing us up for, for races, Cates?

The best part is trying to wrap us in that. Like, I'm a homebody. No, thank you.

I wanna do this. Thanks, Dad. He like, we like literally, you just like bought us all really nice road bikes and I'm like, I don't even wanna do this, but okay.

Okay. Hey, your husband rode a Century with me.

My husband is game. I know. I don't know why you feel like you have to rope me in if you've got him.

Don't worry. That's why we gave you son-in-laws.

Yeah, that's exactly, that's right. I do have great son-in-laws, so they're, they're awesome, but I have great daughters. So, uh, which is awesome as well. But this does tie back around because Partly what makes our life so great is we have a lot of options. And that's the Founder Optionality Method. That's where it comes into that even through— I was in DC this last week, I get interviewed, talking to Bloomberg, I'm doing all these various things and it's great. I walk into the room and here's my picture at the center of the room as the big case against Powell v. SEC. And I had to really understand, people are like, how'd you have the tenacity to get through that? How'd you have the strength to get through that? And I said, well, part of it was, was, is work that I did even 6, 8, 10 years ago, both in failing— so 20 years ago— and being the waiter and saying, I'm not the successes and I'm not the failures. I'm getting through this process and going through these things. That's part of the story. But there's another part of the story that I really want people to understand out there, which is when we build the companies and I'm surrounded by amazing people, I, I am told so often how great my wife is, how great my kids are, how great my team is. And I think that they're always saying that in kind of a tongue-in-cheek way of like, how are you such a fucked-up mess? Because you've got all these great people around you. But no, it actually does lend me credit.

You've got all the resources, man.

You've got everything that's out there. And it's like, yeah, I know. I really am extremely fortunate because even when I start a new company, I still end up In the Founder's Isolation Paradox, cannot help it because it's that new birthing of that new idea. When you're the mother, you actually can't outsource the birth. You'd like to, right? So, you know, I don't know personal experience. I've only watched it a number of times. But, you know, it's like they can't. And as the parent, as the dad, I can't outsource that. You know, yes, I can hire nannies and other things, but it doesn't end up turning out the same way. You guys wouldn't have— if nannies had raised you, it wouldn't have turned out the same way of the impact. That doesn't mean I didn't have help. Because I had a whole friggin village, right? So, that's the getting out of the actual activity. But the part that also was integral in there is, one, I knew that if I had to start all the way over again, I could have, right? Fine. That happens. But the second thing was I'd learned enough that with the, you know, what we now call the Founder Optionality Method, we were able to get me off the chessboard. And so, even though I had to take, you know, some painful points, I didn't worry about my family not being able to eat or not being able to enjoy the things that we do.

That's one of the biggest pieces to complexity. And I'd say top line for our founders on this today, look at where your complexity is adding the layers of risk for you first.

Yeah.

Because you think you're doing the right thing. We see it way too often that oftentimes taking on those additional layers of complexity have put the founder in a position of risk, put their family, put their personal assets in a position of risk. And those are really, really key to kind of have a first pass, first assessment of what can you take off It does not all need to depend on you. It does not all need to ride on you. One of the very first ways that this happens for most business owners is an SBA loan.

Yeah.

I mean, that's one of the very first. So, you go and you get maybe a loan and you've now put your personal assets that are far exceeding probably what the loan You took out. Um, we see that often. Um, we see people using their, their personal— they are doing personal guarantees when their business really should be able to stand on its own at this point.

Well, if you're, if you're lending to the business— and this is a critical part— anybody out there having personal guarantees, please put them in the questions or ask questions about it. But if the entity is lending to the business, then the business needs to be able to stand on its own. If it's not, it's not lending to the business, it's lending to the person, and you're then putting that money in as your equity, and you need to make sure that you are getting paid for that. And that's a huge mindset difference. When you put the credit card in there and you draw— drew it off your personal credit card, that's your money. That's not the company's money, that's your money. The company may pay it back, but if it doesn't, you still are. Right.

And that's, that's when you talk about then the founder being dependent on the business. Now my livelihood is really wrapped up in this, right? And, and we know that mentally that constrains our ability to think expansively, creatively, regulate for the team. You know, we talk about this, um, there's this analogy that I really like about airline pilots. Okay. Which is I'm flying a plane. I'm the leader. I'm the leader.

I would get on that plane.

You would get on that plane every time. We're going somewhere fun and you know it.

Only if Dave's flying. If you're flying it, we're pretty serious.

Yeah, it's a very serious plane. I have learned this is a no-fun plane.

But you sit down. No, no peanuts for you. We have peanut allergies on this plane. There's no peanuts.

Exactly. You know what you're getting. Anywho, we're on the plane. And let's say we start hitting some turbulence and I left the intercom on, or like the door, right, is open to the cockpit and I start freaking out. Guess what happens to my team? The passengers, they go, well, this sucks. Get me off this plane.

Yeah.

Like, it's patently unhelpful. What is helpful is even if the pilot, right, does feel a little nervous, shit, we just hit a storm and we didn't really want to, or this was unforeseen, their ability to stay calm and regulated helps everybody else move in the same fashion. And so, when you think about complexity and risk, when it permeates into the personal life, it's such a contraction that doesn't just stay isolated to the founder. It does impact the company in turn. And that's why disentangling some of those bigger risk items It's such a critical first step.

Yeah.

It is. And so we've had, you know, over the last couple shows or a few shows ago, we had— OK, we had— sorry, Instagram is calling and needs my code, you know, type scenario, I guess, or something for my, for my ski code right in the middle of the show. It's awesome. So I don't even know where I was going with that, but we had—

I don't know.

I don't know.

You're an influencer.

You're so busy. Yeah.

I have questions for you, dud.

Questions? Okay.

For our founders listening. Okay? Where do you see our founders adding complexity, thinking they're solving it? And instead of actually solving these, like, deep underlying issues, I think we see it a lot where founders think they're solving the complexity issue. And really, they, they're just continuing to get themselves into bigger, bigger complexity challenges.

There's so many examples. So one of the things that founders are told by non-founders, or by elder founders that forget what it's actually like, Is boomers. Yeah, exactly. Throat punch them.

Dad.

So I'm not a fucking boomer.

Oh my gosh!

One of those things of the more you say it, the more you say you aren't, the more people think you are.

Nobody thinks I'm a boomer.

Proceed.

Keep going.

Keep going.

Stay on task.

So there's there's so many ways, and they become compounding. Little things like calling it my company, and yet you've set up an LLC, and then you've set up a trust, and then you and I get into this right? I go through a deposition, and it's like da da da. It's like I have to actually be accurate in my language.

How about signing documents?

Signing documents and signing them as, you know, CEO or whatever type scenario or founder and all these other things because it's the ego that gets into there. So, the ego, my hubris has just clobbered me in most cases, right? In many cases, that's where it is. But the system is also set up because when they're looking across the eye from you and they're going to lend you money, so it's the bank and they're going to lend you money. They're not lending me money. They're lending my company Or they're lending the company, the business, the idea. And even myself, I have a hard time saying, well, they're lending my company. No, no, no. Hang on a second. Stop for just a second. I'm an owner and I'm a president or I'm a CEO. The one is a job, the CEO, and it has protections. The owner has only limited risk, and that limited risk should be, only the amount of money that you've put into it. And if you keep those separate, that is a very, very, uh, safe, secure place to be. But the entire system, including the SBA, is purged around getting you back on the board as the founder. And then the other side is your income, the way we're taxed, the dual taxation. If you're a, just a, you know, a what, a sole proprietor, you get double taxed on this. People don't understand that. Or if you're an S corp or however it is, the legislatures have continued to put these risks within there and the banks do it as well. And so what we do at the Founder's Office is really, really take that apart. And here's where I was going with the insurance. So there are so many ways you can use insurance to help get those risks out. And I heard one the other day and I sent it off to Katie. I said, this is an amazing insurance and it was called core It's out of San Francisco. We have no affiliation with them. We don't know them. I can't even speak for them. But I'm like, this is an amazing little policy. They think it's going to be about $8 billion in premiums they'll write this year. And it's for founders, well, for small businesses, that if your agents go rogue and do some harm to somebody, you're insured against the harm that those agents do. Now, obviously, you can't create— and I'm talking about AI, but all these little things. But you could create an agent that goes in, it crawls around somebody and What happens if it just took down an entire competitor's company? You've got insurance for that. And I'm like, see, this is another idea of where you can use insurance, right? You should have litigation insurance and other things. That's not our space. It's— but what I'm talking about is those type of safety things give the founder— and one of the main things you can look at is how do you get a policy that allows you to extract some of the capital off the business earlier? And that's what we brought the last couple guests on. I think we had Garnett on. I don't remember who else we had on. Nathan, I think it was. Was it Nathan or who else do we have on? I'm sorry. Oh, Kim. Kim. Yeah, that's right. Sorry, Kim. Yes, we had Kim on. And, you know, they help people understand that. But here's another risk that came to me when Katie and I were recording yesterday, walking through it, was years ago, I go meet with a financial planner because I've got this money and it's like, what do I do with it? And yes, I'm in finance and yes, I know how to invest that, but maybe Maybe I should have a pool of money over here and there's some other strategies which you do. And they put me into a strategy that was designed for like a medical doctor about making about the same money as, you know, maybe an anesthesiologist at that point, probably making like $2 million a year that I'm paying taxes on. But the difference between an anesthesiologist making $2 million a year and a founder making $2 million a year and the kind of businesses we've done is my $2 million is not consistent. My $2 million was not a salary that I was taking off at different times. And so, when I then did an expense that was an investment and I didn't look at that and they didn't understand my business, then down the road, what I need to look at is I actually need to borrow now to make that investment in there, which is now a bad plan because now I've got the pressure of the borrowing once again. So, picking the financial advisors, and even when you are a financial person, they say a lawyer should never handle their own case, having somebody else be able to sit in there. You've got to look at it as a founder, right? And you've got to be able to use the right products and look at it. So that's where— I know we didn't get any real questions specifically on this, but that's where being a founder's advocate, where we've gotten to. So we've got this family office. We came up with the founder's office. We're like, well, people want to raise capital. But what we've actually found out Is the founder's advocacy is what founders lack in the world. So, when they're launching the company, they don't have somebody that's sitting on their shoulder saying, when you take this money, this is what happens to your equity share. This is where you get crushed down. When you take that money from the bank, this is where the personal guarantee— and so, you need to at least get the reward for the risk you're taking in this scenario. When you've got this capital going on and you're paying all these wonderful things out for your team members to retain them and stuff, Yeah. We need to make sure you're also on that exit plan just in case the business doesn't work. And when it does work and you're paid fabulously well, it's all great, except there's a lot of wear and tear on that as well. This is why you need to have indemnifications within there as the employee. As the owner, as long as you stay off the board as the owner, then you don't have any of that risk. But if you write it up incorrectly and your attorneys don't think about it, They're not your attorney. They're your company's attorney in most cases. So look at that. And they've also never gone through that. The, you know, we— the other one we use a lot is the ham and egg story. The chicken's involved in a ham and egg breakfast, but the pig, you know, they're committed.

Committed.

And so the founder— the whole world's always trying to get the founder to be the pig in the ham and egg breakfast. And so, yeah.

I mean, and it does start in those early days, and some of those things you don't learn till several business iterations down the road because they didn't go so well, uh, or they went really well, but, but you, you finally learned the lesson. Dad, which decisions do we see, or which, um, areas of the chessboard do we see that's still unnecessarily Make the founder feel required. I'm not saying they require the founder. I'm saying the founder feels for whatever reason that they have to stay involved.

Well, a lot of times it's it's it's it's it's what do they call it success guilt survivor guilt. Hmm. So you stay involved. The investors— we've had deals that the deal just didn't work. And they weren't investing. And we'd be told by investors, but I invested in you. It's like, no, you didn't invest in us. You invested in this over here. We weren't even the founders on the deal. It's like, no, you invested with us in there. By the way, we lost a lot of money too. And they're like, well, but you need to work for free to get it to work. And for many, many years, we did that.

Yeah.

Right. At many different times and put years into certain things to come back around to and get people to break even or some level in there. Nobody else would do that type scenario. So, that was a scenario in there. And I see it with founders.

You see that a lot with founders.

Yeah. You see it a lot with founders. Like, they're like, I'm going to make this work because I've got to pay my investors back. And it's like, that is actually really admirable in one way, but it's also You're going to make bad decisions, like Katie said, right? So you went and you don't get there to get a little bit more maturity. And usually it means you've taken— you've been slaughtered. The other part, and this is a funny one, I meant to use this one with Katie when we were recording yesterday. There's a great— he's since passed away, but there's a great judge who also was a boxing referee in a very famous fight. His name is Mills Lane. And Mills Lane after Judge Wapner got put on and they created a show about Mills Lane as a judge. And so, he's doing the Mills Lane, and I don't know who the famous judges are now on TV, but it's one of these things.

Judge Judy.

Judge Judy, okay. I didn't think she's still around. I don't know. I don't know what it is. So, the judge was really a hard, tough Marine-type judge scenario back, you know, he's just that hard-driving guy. So, he's on this TV show and it's coming up for the second season and now they're going to put all these constraints around him And he's like, no, I'm not going to do that. And they go, well, we've got a contract. And he goes, I have fuck you money. And they go, what's fuck you money? He said, fuck you. And he walked out the door. He goes, I don't need to do this job. Right? So one of the most important things about having as a founder is that optionality and understanding that when you're sitting across the bank, when they've got the fuck you money, you are going to get fucked most likely. Right.

We need to put a rating on this episode.

Yeah, explicit.

My apologies to the audience.

Can I make a distinction? Because I do think there's something I— as I'm just listening and continuing to learn and, and all of these things, I think that you have a complex system, Dad. Your organizational structure is complex, but how I would distinguish it is It's complex in service of options and protection, like, so, de-risking and optionality. But it doesn't mean that you just strip everything down bare bones and think that that's all good. Like, it's a structure to create that optionality.

Talk to my team about it. Oh my God, it's a huge structure.

Yeah.

And part of it is because you didn't used to have to have that by any means, but our laws and especially our administrative law and agencies and then at the states, have come back around so much that they do hold that founder to an unbelievable level that nobody else is held to that scenario. And you're like, oh, well, whoa, they get rich. And yes, absolutely, the rewards are phenomenal, but not everybody gets those rewards, and most actually get damaged somewhere along the line. Yeah.

Right?

And it's been very interesting because we've had judges and other people on the other side say, Well, clearly you set up all these systems so that you could just avoid risk. Yes, that would be correct. Yes, you are absolutely right. And there's like, you could avoid responsibility. I'm like, nope, that's actually not why the responsibility is here, but I don't take excess responsibility. And so that's what they've always asked. So the banker's sitting across the table and they'd say, Katie, Of course you believe this business is going to succeed. You'll put everything into it, right?

No.

And you guys have learned that.

Of course I would.

Yeah.

Yeah, of course. Yeah. You're like, this is— this is— I'm so—

well, they play right to your ego. The whole system's designed to play to your ego.

It is.

And we have another one that— and it's interesting because in certain parts they've made Rumpelstiltskin, the character of Rumpelstiltskin, into a more Jewish, which is known for being the banker scenario. Which is this whole tie back around. But it's that scenario. Of course you want this so bad, you're going to go all in.

Yeah.

And they take your soul, they take your money, they take your life, they take your firstborn, whatever it is. That scenario is because it goes on and on and on and on. And what is great, why I'm— one of the reasons I'm a constitutional scholar is because of how brilliant the founders were when they were putting this stuff together and what they put into that article. One scenario was the right for business founders to start over again. And the government even still tries to write around that to not let them do that. It's crazy. So, we got no questions?

Well, I have one closing question for you because I think there's a big difference. You know, Katie's hearing some of these stories from you for the first time. I probably could use a refresh, but some of them I lived through. And so, I've got a different like experience with them than than even Katie did. But something I've seen you build over your career as a founder, as your life of a founder. When I was little, I— so I'm asking you to think to the business you owned when we were kids versus what we do now. If you were to leave your business, disappear from your business for 30 days, Hmm. What would break?

Everything would have broken at that time.

Everything. I remember—

In multiple, multiple businesses. I couldn't walk out.

Couldn't walk out the door.

When we had a company that was in 50 states, so that's 6 time zones. Most people don't think that, right? So, you start— I'd start my morning at 5:00 AM and I had presidents of those regions, right? So, from Virginia to Alaska and Hawaii. So, there's presidents of those regions. And I'd wake up at 5:00 AM to go do my workout. It's already 8:00 AM in Virginia, and one of the presidents or something would be coming up, and there would've been a problem, and they want to jump me on the phone because I didn't have the skill sets. I didn't— I put the people in there. I had the theory of, oh, you hire great people, and they were great people, but we still had systems that it was still through my creativity and the different pieces. That we're in there, right? So it's five a.m. there, or it's five a.m. here. It's eight a.m. there. I'm trying to get home because we were really consistent. I hope you guys remember it. I at least remember this way. We're very consistent of having dinner at six p.m.

Yes.

No matter what sports you guys were doing, no matter where it was, still very rigid about dinner time in my house. And Reva is not.

I'm like, I eat at this time.

I know.

It just kills me. So, but you know, we so at six p.m., I'm trying to roll in and get there, and even if I had to work later at night. night, it didn't matter. Dinner was just sacred to me to be able to catch up with all you guys, figure out what's going on the day, share the wins, share the losses, whatever scenario. I'm trying to get in there and it's 6, but it's still 3 in Alaska and Hawaii, and I get stuck. I don't know how many times I'm parked in the garage, I'm trying to get off the freaking phone.

Well, that was when you had a cell phone. I remember you like racing home. We lived across the street basically from your office, so you would race home to like Get to your home office.

Yeah, yeah, yeah, yeah, yeah. No, so, so, and you remember another time when we're going on vacation, and boy, that was a— we had a regulator walk into the office, and it was all fine, except it wasn't. Because, you know, they're like, what, you know, what do we do? What do we do? And I think, uh, I can't remember who was running the office. I think it was Shelley at the time or whatever. They had something going on, and, and so all of a sudden they're asking me questions and I'm stuck. Yeah. I don't, you know, yeah.

So. Versus now, versus today.

I went skiing and I don't hardly talk to anybody, you know, or I don't.

Well, and we all, we all get really excited.

We're like, we're all a little more productive.

I think Kelly and Angela are all like, see you later.

Don't call.

Don't use our number. Actually get something in. Did we turn his phone off?

Yeah.

Does he have cell phone service? Sorry, your plan doesn't work there.

I don't think they like when I took the Elon down with me to Chile, right? I know. Yeah.

He got a Starlink and we're all like, dang it. So, I say that hoping to close this out for all of our founders listening, the evolution of a founder and the complexity, you do get better over time. If you're learning the lessons and you're applying the lessons, ideally, you're removing your involvement in that complexity and not having it be so dependent on you so that you can Live this great life of a founder. Now, it took you 40-something years to get here. And—

I still do it horribly. I still am bad at it.

Can you not talk about that? You still are a work in progress.

But that's life. You'll get another pass around. It's okay. So, but look at how far you've come. Like, where a lot of times we can take a first pass, the team can take a first pass at the complexity Oh, yeah. Removing you from the board. And some of that's because we've got an evolved team as well too. We have a team that's been—

Well, you guys don't even let me make investments hardly anymore. It's so funny, this type scenario. It's like, I got to go ask permission.

Yeah. I know. Now, you don't get to do anything without asking. So, I hope that closes this level, this conversation about complexity out for our founders listening that You're not stuck in this. You might be stuck on the phone right now dealing with the things that you don't want to deal with, but eventually you can get to this place.

How do I have a Sunny here, Katie?

Oh yeah, my dog is visiting you today. Tell him hi for me. He's running in. Yep.

If you don't know, Katie's up at Tahoe. I know that. Right now, and I'm not.

No, my lovely husband dropped in so that way he can go work, and he's at your house playing with your babysitting dad. Yeah, that's what your job is now. Sorry, I didn't tell you about dog.

I'm dog sitting, I guess, because you told me you were coming down tomorrow night. So that was yes.

So nope.

Anyway, this is the one. This is the fun of working with a family. Into that light. Tell me about WTF, Angela. Pop it up on the screen. WTF Women Talk Finance and what the fudge.

Oh my gosh, Dad, this is a rated R episode today. My apologies. Yeah, actually, we—

we're—

by the way, I just want to tell you this because literally, I don't know, an hour ago we had a call with one of our attorneys and we're dealing with a problem on something that is, you know, ages and ages and ages ago. Kirsten goes, I don't want to book that call there because you'll be grumpy for Lunch and Learn. And I said, I won't be grumpy. And sure enough, I get off the call and I'm like, I'm fucking grumpy.

So That explains why you owe so much to the swear jar today.

So, Kirsten gets a great bonus.

10 minutes before, 10 minutes when I'm supposed to be getting on for prep, I get a call from the mayor to tell me we're on for getting the extension of the lease for the nonprofit that I'm raising a ton of money on, right? And that's really where I spend a lot of my time. So, I'm on the—

it is that total picture of, I believe we've got a new episode coming out. They come out every week, and yeah, it's it's going very well.

And it's sponsored by the Founder's Office.

It's sponsored by the Founder's Office.

Yeah. And you know, I'm so so for those that don't know, I'm so friggin amazed and and surrounded by such amazing women. And it still does take though. It's not just okay to just have amazing women. They also do have to have the support and backing and be around. You know, men that allow all of this to come together because of course we're the creators of the universe. I'm kidding. I'm going to take a punishment now from everybody that's on my team.

Man, you're fired.

Your boss is fired.

That is my—

yeah.

Oh yeah, you need your sound machine.

Kelly just texted, close his ass out. All right.

This is the deal.

So, this is how you get Women Talk Finance. Uh, Dr. Katie, where do people go to find out more about what we're doing with the Powell Perspective? And you've got some amazing things happening with the Founder's Office, by the way. She's systemized and structured a number of different things that we're working on to give you guys better tools as founders, because that's what she did with her doctorate. So truly, Dr. Katie Powell in this space, um, which is great because Candace and I sit here and talk about it, and now she's actually getting it implemented to share these tools.

So, Kate, you know, our system is talk and teach with people and then give folks a place to land. So we've got actually a couple of really exciting things coming. But I think what's most pertinent for today's discussion is really that founder's risk assessment. We'll drop the link in the show notes as well, but it's also on our website, foundersoffice.com. What I would offer in that is it's just a really easy tool for busy founders. I mean, it's like built by founders. So, you know, oh, I would never take that long of an assessment. But it's at the crux of helping you find those core complexities and risks that Candice spoke to earlier, just to help you get started. Right. I think our mission here is to help people learn from the things that we've learned from in maybe more painful ways and make sure that it's a little bit less painful of a path for others. So foundersoffice.com has that tool as well as others, but it's really the Founder's Risk Assessment I would invite you to, to explore. And then next week we'll talk a little bit more about kind of our wonderful platform and some other tools, as well as other ways that we're really trying to make sure we reach founders. So more to come next week.

Awesome. Well, thank you both for joining us on Lunch and Learn, letting me join you guys and, and get harassed throughout this. And to our team, Angela, as producer and engineer on this case. Thank you so much. And, uh, that's it for Lunch and Learn. Everyone have a great day.

Thanks for sticking with us.

Bye.