Own the Money Business, Never the Factory

““Because Winston wants to create Churchill cigars, and he wants Sidney to be his partner." The Haitians would have to wait, again. I was on the next flight to Nassau, and then on to New York. Winston wanted to pimp out his grandfather's image and family name by developing Winston Churchill brand cigars. He was seeking Sidney's sage wisdom and marketing advice, and a little venture capital between new chums never hurt. After all, Sidney’s Midas touch could turn shit into gold, and he had the sterling to float a risky venture with a fancy British socialite. Winston was nobody’s fool, and he knew the most important business lesson. Never use your own money if you don’t have to. I walked into SFIC boardroom and scanned the occupants. Sidney had assembled his executive dream team, primed and ready to heap praise and adoration on whatever plan he concocted. They looked unanimously agitated when I walked into the meeting and sat down at the table. I was intruding on their sacred sales domain. I was feeding from their trough and diluting their pie. They had no clue that I was responsible for getting Winston and Sidney in bed in the first place, but I wasn’t about to give them the satisfaction. The executives enlisted the expertise of an eager Davidoff sales representative who was ready to pounce on what must have sounded like a dream come true. The Churchill name was almost synonymous with the image of a cigar, and the Churchill family had never considered licensing their name or Sir Winston’s distinctive image to something as vulgar and mundane as a tobacco venture. Winston waltzed in looking the dapper English gent, draped in a bespoke suite and handmade loafers. He worked the room, pressing the flesh and sharing a chuckle with most of the executives. Sidney was wheeled in last and rolled to the head of the table, cigar in his mouth and his eyes barely open. The London trip had taken a toll on him, and he was still recovering his energy. He was sitting fairly still, and I was not entirely sure he was awake. We sat through Mr. Davidoff’s tediously well-heeled pitch. We feigned interest in his colorful charts and graphs, market research, metrics and forecasts. They would source tobacco from the finest plantations in Nicaragua, and the marketing campaign would be exponential. Churchill cigars would be the biggest thing to come out of England in years. Bigger than the Beatles. Davidoff had gone all out on this sucker. They even prepared branded cigar boxes and mock-up labels with tiny pictures of Sir Winston on the cigar rings. First class. Top shelf. The Davidoff show finally ended, and it was the rep's finest hour. He was prepared to accept Winston’s and Sidney’s undying gratitude and signatures on the exclusive licensing agreement conveniently stashed in his expensive leather attaché. He primed his Monte Blanc fountain pen out and prepared to bask in mega deal afterglow.”

“Lil Jon and his posse were returning to their limo after a successful business meeting with Sidney, and they'd decided to spark a spleef to seal the deal. And it was a sweet deal for Jon. He was offered the opportunity to be the face of Crunk!, Sidney's new energy drink. Sidney would pay him one dollar for every case sold. That was the deal, and it didn’t get much better. Jon didn’t have to contribute a penny to the venture, just his distinctive name and face. Sidney assumed all the costs and risks. At the time, Jon was a relative newcomer to hip-hop, but he was a savvy marketer. He’d coined the term Crunk! (a blend of ‘crazy’ and ‘drunk’) to describe his music and lifestyle, and his personal brand was busting out virally and exponentially.[ 11]”

“Insurance companies enjoyed some terrific advantages, as compared to manufacturers. Insurers offered a product that never went out of style. They profited from investing their customers' money. They didn't require expensive factories or research labs. They didn't pollute. They were recession-resistant. During hard times, consumers delayed expensive purchases (houses, cars, appliances…”

“A bank didn't manufacture anything, so it didn't need expensive factories, finicky machinery, warehouses, research labs, or high-priced PhDs. It didn'tpollute, so it spent zilch on pollution-control devices. It didn't sell gadgets or ready-to-wear, so it could avoid hiring a sales force. It didn't ship merchandise, so it had no shipping costs. Its sole product was money, borrowed from depositors and lent out to borrowers. Money came in different guises (coins, paper, blips on a screen), but was never obsolete. Banks competed with other banks, but banking itself was always in vogue.”