It’s times like these that I am most glad I read more than just business books. In fact, as I was running the other night, I found myself thinking about a question I’ve been asked a number of times recently. What’s the one piece of advice I have for other founders in tough times? I thought about this for a few seconds and found that the answer was easy. Read great books. Not great business books. Great literature.
You see, great literature almost always follows the arc of human struggle. In those stories lies the essence of humanity, and continued exposure to this will teach you the humility and perseverance to weather tough times and help you make the kinds of decisions that you will be proud of 30 years from now.
Whether it is obvious examples like Atticus Finch in obvious books like To Kill A Mockingbird, or Samwise Gamgee in books that don’t get their due as literature like the Lord of the Rings, or Captain Yossarian in towering classics like Catch-22 that might take 2 or 3 readings as you age into understanding them, the guidance we seek is there waiting for us. And the more of it you accumulate over the course of a lifetime, the better prepared you will be for your moment of crisis.
As soon as COVID-19 exploded onto the Western world, markets collapsed. Within days I was getting five to ten “Guides to How to Respond in a Crisis” from pretty much any venture firm, consultancy, or investment bank I’d ever spoken with: “Cut fast and cut deep.” “You can never cut too much.” “Don’t let a good crisis go to waste.” “Cut all non-essential services.” “Now is the time to cut any underperforming resources.” “Cash is king.” “No one will get fired for weathering the storm with too much cash as protection.” These recommendations were taken to heart by many in the US, and, within three weeks, 16 million people had been laid off.
As I read and processed all of this, my first reaction was to think how odd it was that everyone had the exact same advice. I’ve usually found that when everyone has the same advice, it’s probably wrong. But then it hit me what felt so off about this. It only made sense if the sole purpose of a company was to protect its shareholders. What happened to the rise of stakeholder capitalism? It was only a few months ago that the New York Times was writing articles about how the Business Roundtable was revising the definition of corporate purpose to include constituents beyond just shareholders. Could it really be that this change was so weak that it would be thrown away two days into the first hint of a crisis?
So I sat down and thought about two things. One, if VidMob truly is a stakeholder driven company (hint: we are), how should that impact our response? And two, if I thought about some of the characters whose various moral codes had impacted me so greatly over the past few decades, how would I envision them responding? Here’s what I came up with:
An Alternative Guide to Crisis Response:
How can you keep all of your people?
With the dual shocks of a life-threatening global pandemic and the greatest unemployment since the Great Depression, individual anxiety levels are at all time highs. Now is exactly the time to be caring for the most vulnerable members in your company. Instead of letting them go, find out how to get more from them. If business realities demand cost reduction, use temporary pay cuts—accelerated for executives and lower for entry-level—to bring the same savings.
How do you ensure the mental health of your team?
While remote working remains necessary (or even just generally advisable) for non-essential companies, we will all be alone far more than we are used to. Couple this with the anxiety mentioned above, and you have a lot of people in mental frames that they are not used to. If you were transparent before, be twice as transparent now. Uncertainty will lead people to assume the worst. Remove that uncertainty so that they can understand exactly what you are doing and why.
How can you positively impact the communities you serve?
We’re all in this together. And keep in mind how money flows around a community. Your dollar that used to buy a coffee in the morning would then be spent on lunch for the barista and later on dinner for the deli worker and later on home supplies for the server in the restaurant. Every dollar rattles around a community and has far more impact than you can imagine. So when you remove that dollar, the impact is far greater than you understand at first. Think about your community, and try to figure out how to keep that money moving. Maybe your local restaurant can prepare a bag of ingredients for you to cook at home? If they can, buy it…and tip them!
When you need to make cuts, how can you prioritize the ones with less human impact?
The easiest places to cut are the ones that have the least power. People who clean your office. Certain part-time contractors. While these decisions might be easiest contractually, try to put yourself in their shoes and imagine that every company they work for is probably thinking the exact same thing. If you can, look for savings from people with the means to handle it better.
- What would the best version of my company do?
- What response will we be most proud of five years from now?
The best books I’ve ever read taught me that great characters do great things. And great companies should aim to be no different. When things looked their darkest, deep in Mordor with literally no hope to be found anywhere, did Sam Gamgee look to see what weight he could cut in order to make the trip easier? No. He put a weakened and near dead Frodo on his back and fucking carried him up the mountain.
Yossarian’s singular goal in life was to live. This is my goal in these troubled times with VidMob also. But we will survive according to our own moral code, in full recognition of the fact that there is an ocean of difference between surviving and living. We will live according to the new code of many of tomorrow’s best businesses. A time of crisis is not the time to retreat from your commitment to stakeholder capitalism, it’s the time to double down. Even as businesses start to reopen in the months ahead, the ramifications of COVID-19 will go on for many months thereafter.
A great mountain still looms ahead of us. But we are strong enough to carry more than we can imagine. I look forward to the challenge, and I have no doubt that sticking to our commitment to all stakeholders, especially when it’s hard, will end up rewarding our shareholders even more than if we took the shortcut proffered by the conventional wisdom of a bunch of people who read nothing but business books.