Entrepreneurship and ethics

Ethical shortcuts get you to the grave.

A few core principles, strongly enforced

I am not a big fan of binary opinions, the always or never rules, but when it comes to business, you have more chances to go bankrupt than to succeed. I prefer to avoid taking some probably useless shots than betting against my very few core, foundational principles. What’s my main point here:

• Do not load your mind with a mountain of codes you will not follow, keep it simple and actionable.

• Please find a few of them and make sure they are significant to you.

• Try and stick to them when you are sure they help you go in the right direction. This is why you have to choose them carefully.

Exercise patience. Life isn't a mathematical equation where you can easily compute the likelihood of future occurrences. Validate your ideas through your experiences and adapt swiftly. It's acceptable to make a mistake once. It's unfortunate to fail again for the same reasons due to a flawed feedback loop. You will need to face the proof of time and be patient. I am sharing here my main principles.

Not for life, not for one day

A common mistake that founders make, including those who are not first-time founders, is believing they can navigate temporary bad situations and thrive in a toxic environment with toxic people just long enough to make a quick profit. Entrepreneurship is a 24/7 job, not because you will work around the clock—indeed, you should avoid that—but because you will likely think about your venture constantly.

Here is a critical point: if you can't work with someone for the rest of your life, don't work with that person for even a day. I am convinced this piece of wisdom comes from Naval for a reason, but many successful entrepreneurs follow similar principles. You would be better off doing a few terrific deals with fewer than five people for the rest of your life than entering a hundred average businesses with a hundred different people you disagree with on foundational principles regarding how to run a business and approach life.

Particularly, first-time founders often struggle to build good judgment about what constitutes an excellent opportunity and a good business partner. When I partnered with people thinking short-term, not only did it inevitably fail, but I also had a nagging feeling I chose to ignore, which led to catastrophic outcomes. Trust your gut.

A personal story

A couple of years ago, a CEO called me to offer the role of CTO at his promising e-commerce start-up. They were raising funds and had closed a few tickets with good investors, offering a solid equity package along with a competitive salary once the round was completed. There were two significant problems: the CEO had some good ideas and aimed to solve a substantial issue, but I was convinced he was taking shortcuts. More importantly, I felt uneasy about his personality during the few times we met. He showed great interest in my background but never listened to me; it was all about him and his next unicorn. I also ignored a major red flag: he was addicted to booby prizes and spent all his time chasing meaningless accolades. I still believed his idea was promising and thought I could make some money in the short term. It was an opportunistic move, contrary to all my values, yet I accepted the position of part-time CTO at his start-up. Needless to say, I couldn't care less about his e-commerce venture, but at that stage, it felt like a drop in the ocean. I was making a short-term decision against all my core principles.

And then boom.

After a few days of work, he called me at 4 AM on a Sunday to address an urgent matter that turned out to be a random development detail. When I expressed my discontent with this behavior, he replied, "I had the best grades in high school and was a very competitive athlete; I don't tolerate mediocrity." That was it. As CTO, my opinion was dismissed, and the developers and I were forced to follow his irrational, misguided roadmap. Do you know what happened next? I resigned after a month, and our dear dollar-city Steve Jobs was so offended that he wanted to sue me. I finally extricated myself from that project; it never took off, and they ended up clashing with some of their investors.

I learned a valuable lesson: you never win by cutting corners, and whatever you gain in the short term, you'll lose twice—whether in your wallet or your mental health.

Believe in business karma

Short-term thinking is not just about finding a co-founder. In my experience, the project was legitimate, and they did not intend to scam anyone. It may seem obvious, but please never get involved in Ponzi schemes or other scams. If it sounds like a scam, or if you have any doubts, walk away. Not all scams are the same; you can work for a company or create a business selling a legitimate product while cutting legal corners and deceiving consumers. Sometimes, you may find yourself on the verge of a scam, selling something overpriced and exploiting someone's naivety. Unethical, shark-like mindsets may seem attractive and alpha, but let's face it: they're pathetic. Believe in business karma, no matter how foolish it may sound: if you gain an unfair advantage over someone, it's often only a matter of time before you pay for it, either with that same client or someone else.

Sign fair deals, give more than you ask for, and you will attract givers who will consider you when they have legit, good money to make. Kindness and fairness are underrated, and I am not talking about giving dollars away, but don't be too greedy on people who have been fair to you. Some founders make people pay for their fairness and kindness and view themselves as the real deal. That's pure short-term thinking, and they will just tunnel themselves with the rest of the short-term sharks and eventually end up being eaten. Treat people well, tell them the truth, and sign fair deals.

A widespread example is over-selling. You are a young start-up founder with an MVP product and solid capabilities in developing and shipping new features. A potential client approaches you and asks for a part you are about to deploy. In this case, the only reasonable solution is to tell the plain truth: it will take a few more weeks to get the beta version deployed, and you might be a crash-test client, paying the early technical debt that every quick deployment generates. That is fine. My main tip as a technical founder is that clients will never dislike you for deploying something imperfect— or just a little bit— if you tell them the truth before selling it to them. By doing so, you gain their trust and place yourself in a very comfortable position. You may even gain a paying product manager providing you with feedback while subscribing to your service. Honesty and transparency in business are underrated. Tell the truth, be transparent, and you will become addicted to it.

Don’t get involved in Ponzi schemes, and if you do, don’t tell me.