I lost $25 million and couldn't be prouder. Here's what it taught me about following my values.
Courtesy of Marco Greenberg
- Marco Greenberg is the president of communications boutique Thunder11 and author of "Primitive: Tapping the Primal Drive Powering the World's Most Successful People," published by Hachette and available April 2020.
- He was an initial advisor for a friend's internet company - and agreed to a lock-up period of his stocks when his friend called and asked.
- That phone call ended up costing him $25 million when the stock price tumbled.
- But, to this day, he still doesn't regret it - he focuses on using his money in values-based ways, such as supporting a friend.
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We eat too much, drink too much, and spend too much. Such are the indulgences of life.
But rather than regret and atone with stricter goal setting, I want to argue the opposite: Loosen the reins and be even more generous with time and money. Let go of the Protestant ethic of "work, work, work" and "save, save, save." Instead, start putting principles over profits.
Twenty years ago, I faced a major test of placing loyalty and friendship over dollars and cents. One of my best friends cofounded a booming internet company fueled by a huge IPO. I was fortunate to be an initial advisor. But when he called me to ask me to agree to an additional six-month lock-up period and hold onto my stock to send an upbeat message to Wall Street, even I had to think about it. I pride myself on being devoted, but unlike the other early shareholders, I was running a small business and had a big mortgage and a kid on the way.
My accountant's advice was swift and to the point: I must not agree. I had a "get-out-of-jail card," meaning I was no longer legally "locked up" and obligated to keep my shares. If I sold, I could instead give a few million to the founder's favorite charity. From a financial point of view, it was a total no-brainer that I should immediately sell, my accountant said. He issued no rulings on friendship or ethical considerations.
The next day, I called my friend and told him that I would not have had any of this financial windfall without him. I would honor his request and send over the signed paperwork.
On January 3rd, 2000, the stock price of Akamai Technologies reached an all-time high of $345.50 - and I had 180,000 shares. In April 2000, a few weeks after my fateful conversation, Internet 1.0 came crashing down. I checked Yahoo Finance several times a day and watched as the stock price tumbled. By October, it was down to $45 dollars. I eventually sold at a fraction of the high. I lost an estimated $25 million from that one phone call alone.
Many of my friends shook their heads in disbelief, and, to this day, some still vehemently disagree with my decision. But I have no regrets and still marvel at my luck - especially as my friend, Danny Lewin, was murdered a year and a half later on 9/11.
Such defining moments have become guideposts for me on how I live my life.
I draw inspiration from people like Aaron Feuerstein, who saw beyond the dollar. He was the CEO of Malden Mills, the first to manufacture Polartec polar fleece. After his New England factory burned down in 1995, he continued to pay the salaries of his 3,000 workers while the plant was being rebuilt - an act of nobility.
I don't lay off good employees or talented freelancers even when we're having a tough year.
In both my personal and professional lives, I've targeted areas where I use money (even when I can ill afford it) in values-based ways:
- Education: Great public schools exist, but my three kids mostly went to private school. The experience has offered many advantages - including small class sizes and highly engaged teachers - that most students unfortunately don't receive. If I could, I'd do more to improve public education.
- Charity: A friend once said people give for only three reasons: out of guilt, for the ego, or because it's worthwhile. I've tried to do the latter with causes like DonorsChoose.
- Home: How I wish I had the money back for building that stone fence or the office next to the garage at my house in Connecticut, sold long ago. Your contractor will tell you that you'll increase the resale value. Don't believe him. Judicious improvements that are focused on family are another story: turning that basement into a family room or buying that jumbo swing set will have exponential returns on fun, family bonding and unforgettable memories.
- Travel: Other couples get divorced; my wife and I move around. Of course, with the kids in tow - sometimes to their annoyance. We fall in love with new neighborhoods and cities, and sometimes end up moving there. Make a point to go abroad, take that safari in Tanzania, tour Angkor Wat in Cambodia, float in the Blue Lagoon in Iceland. Been there and done that - it's worth it.
- Entrepreneurship: I will probably never be interviewed by my favorite podcast, "How I Built This," featuring the most successful startup founders, but I haven't been shy about turning a crazy idea into a business. One or two have been successful. Another, a pre-YouTube web video company, was a financial disaster. Obviously, that's the one that taught me the most. The first lesson I learned was that if you don't know how to do the work that your business is based on, such as video production, you probably shouldn't be running that business. The second is, as my friend Scott Tobin, a successful venture capitalist, once told me, "Don't believe your own publicity." We were getting press left, right, and center for a novel idea, but novel ideas don't always make good business models.
All of this reflects research which shows that true happiness is built on experiences - not material possessions.
This journey hasn't been easy. For some it might serve mostly as a cautionary tale about how people blow their money. I'm comfortable, but not nearly in the way I'd be if I had turned down the request of 20 years ago and invested the principal. But I've had much joy along the way, and the photo albums have infinitely more worth than financial statements.
Sure, I've doubted myself a little about my handling and mishandling of money. I joke about my financially savvy son suing me one day for financial malpractice after combing through the records of our nest egg whittled down.
But if my regrets are limited to the financial (even the best investors have a few of those) then I'm in good company. I still have the ability to fight my way out of the jam and eat what I kill - by getting more clients, or even writing a book that honors the above principles.
Frugality can become stinginess with deceptive speed. And that attaches not only to your bank account - it affects your state of mind. And, as my friend Anthony reminds me, giving it away creates good karma. We could all use more of that.
There's more to life than adding up the possessions - or even the career accomplishments. Give yourself permission to bestow gifts on others in 2020 - and most importantly on yourself.