What Not To Do: Lessons From 'The Wolf of Wall Street'
Much like love and hate, a fine line exists between great entrepreneurship and good old-fashioned con artistry.
It goes without saying that entrepreneurs have a magical way of building something out of nothing. The caveat? Well, unfortunately the many character traits that behoove an entrepreneur -- if not given a healthy dose of reflection and introspection -- can also raise red flags with the ones that matter most: partners, investors, employees and most importantly, customers.
Just look at Leonardo DiCaprio's portrayal of scam-artist stockbroker Jordan Belfort in "The Wolf of Wall Street." While he was certainly entrepreneurial in building his empire, he crossed many lines that catapulted him into the con category -- taking many others down with him.
Without self-awareness and reflection, it’s easy to end up engaging in behaviors that may negatively impact business, not to mention the people behind it.
So how can you avoid being a wolf in entrepreneur's clothing? I asked an array of prominent professionals their insight on being an ethical entrepreneur. Here their list of do’s and don’ts for staying on the “great entrepreneur” side of the line.
Don’t be shifty. I once sat in a room with a potential client and asked him how many users had downloaded his app to date. He said to me, “App users are so whack, they want everything for free. We are keeping our price at $1.99!”
Either he was deaf, dumb or just plain ridiculous, but I certainly wasn’t willing to find out which one (or combo of those) elicited such an inane response.
“Directly answer questions asked by others," says managing director at venture firm Inventus Capital Partners John Dougery. "Look people in the eye when you answer, don’t be ‘shifty’."
Prabhath Sirisena, co-founder of online-billing platform Hiveage added to this point when he stated, “Being honest and straightforward with communications is another important aspect here. For us, it’s a way of operating that builds trust.”
Do be empathetic. When entrepreneurs are in “sales” or “million things on my mind” or “I just raised $10 million and I’m the shit” mode, two things generally happen.
First, they develop tunnel vision and often become extremely forgetful about anything other than what they are focused on at the moment. Second, their type-A tendencies go into overdrive and they bulldoze their way through decisions -- forgetting that actual human beings with thoughts and feelings are on the other end.
This sort of behavior, according to Michael Coren, founder and CEO digital-publication platform Publet, can result in end-to-end business failure.
“Lack of empathy has recently been on cringe-worthy display among young tech CEOs and programmers. It's a deadly flaw for founders who want to build products that people actually buy," he says. "If you can't empathize with users and their problems, then others will -- to their success and your failure.”
Do take the blame first and the credit last. “Projecting blame on others or on external factors like markets or ‘luck’, and claiming most of the credit and the rewards [equity] that goes with it, can be fatal," Dougery says. "Great entrepreneurs accept the majority of the blame first, take the credit last, and make sure their team participates in the success and its rewards.”
Don’t have arms longer than your pockets are deep. Taking financial risk and money from people -- investors or customers -- when you are unsure if you can deliver on a promise is a temptation for entrepreneurs during early-stage growth.
Kevin McLaughlin successfully built his firm, Resound Marketing, by making it a habit not to over promise. Instead, he chose to set up realistic expectations upfront about services they could deliver.
“As an entrepreneur, sometimes your arms can be longer than your pockets are deep depending on what stage you are in -- the prospect of cashing in can be tempting," he says. "Ultimately, you'll always be able to trade on your reputation, no matter what your bank account may look like. Be cautious to not risk that reputation for an easy score: It just may cost you more in the end.”
Do dream big (just don’t lie). At some point your vision has to be met with reality. An ongoing trip to no-progress-land erodes trust both internally and externally. Your employees will bail or your customers will jump ship. And your investors? Don’t even get me started.
“Intellectual dishonesty can become systemic with even the entrepreneur believing their own rationalizations," says Dougery. "The bad habit of always sugar-coating bad news can lead to the extremes of cover ups and outright lies.”
Coren sums it up nicely, “Sell the vision. Dream big. Swing for the fences. But don't lie."
Related: How to Scam-Proof Your Business