Painting by Shai Azoulay
All good things must come to an end. That cliché has never rang more true than today, as we approach the end of 2022. After more than a decade of near zero interest rates, bloated valuations and massive IPOs, the era of prosperity we’ve all grown accustomed to has reached its end.
Right now, as many of us are facing financial challenges, there are unprecedented opportunities out there. But if we are to recognize them, we must first review what lessons can be learned from the current state of affairs. And here are 3 important lessons presented to us in parashat Miketz.
- Listen to your inner voice
Parashat Miketz opens with Pharaoh’s dream in which seven cows, of handsome appearance and robust flesh come up from the Nile, followed by seven other cows, of ugly appearance and lean of flesh, who then devour the first seven cows.
On the face of it, it’s not very clear why Pharaoh, the ruler of all Egypt, allows himself to be disturbed by something as trivial as a dream. But that’s exactly where the rubber meets the road – Pharaoh is disturbed. And the fact that the feeling that something big is about to take place came to him in a dream is irrelevant. All that matters is that the feeling is there and that he acknowledges it.
As a leader, Pharaoh understands that the bothers and difficulties of the entire nation pass through him, and that his job is first and foremost to give vent to the consciousness of the people. He shows leadership by endowing the dream with national importance, consulting with all his advisors in trying to find an interpretation. It was no sixth sense or intelligence that planted the dream in Pharaoh’s mind but rather his absolute devotion to his purpose as the one responsible for the wellbeing of his people, and consequently his awareness of his inner self.
Every leader, be it a statesman, a startup CEO or a VC partner, is required to be highly alert and attentive to any feeling of discomfort or uneasiness, whether it has to do with company expenses, working with an employee or investor, or the state of the market. Those feelings, which we surely feel day by day, must go through a filtration process and it is then our responsibility to choose the right course of action.
The responsibility for the success of our endeavors lies solely on our shoulders, each in his or her respective field. And for those who are only now awakening to the harsh reality where they realize they did not show that responsibility prior to the crisis, I say – take it now. It’s never too late.
- Taking responsibility for whatever happens tomorrow
Joseph, the first economist in history and Egypt’s burgeoning “Ministry of Finance”, offers Pharaoh an interpretation: Seven years of financial prosperity and great satiation are coming, immediately followed by seven years of severe famine that will erase all the plenty of the first seven years. He then presents Pharaoh with a practical plan for collecting enough food to sustain the land of Egypt during the famine. Joseph’s advice is simple – you must save up now in preparation for hard times, which are sure to come.
Were Joseph a startup CEO we would say that he acted wisely and responsibly. One of the key functions of a CEO – whether some divine entity gave him an insider tip about a future crisis or not – is to make sure that at any given moment the company has enough capital to keep it going. And that in itself is an art form.
Beyond being able to survive a crisis, the way the CEO handles investors’ money throughout the startup lifecycle deeply affects his relationship with his investors, and their motivation to invest in him further. It happened on more than one occasion that I invested in entrepreneurs who failed and in the process cost me a great deal of money, but I was not disappointed in them; and then there were others who failed and didn’t cost me all that much but who left a bad taste in my mouth. The reason for that has to do with the way they handled investment funds – were they acting in a responsible and organized fashion, were they lean, did they communicated with me throughout or only when they needed money, and so on.
I especially appreciated those entrepreneurs who prior to the crisis showed a willingness to cut costs, even when it meant having to make a painful personal sacrifice like making cuts to senior management salaries, including their own. As an investor, it shows me that they were responsible enough to set aside enough capital to allow them to work without funding for several months if the situation calls for it.
And as a lesson for the next crisis, let us demonstrate the same common sense as Joseph’s: Times of prosperity do not last forever, and so we must be financially wise and build up our reserves so that when reality hits we will be the ones in control.
- Be prepared for your luck to change
My favorite definition for the word Luck is the one by Stoic philosopher Seneca, who defines luck as the thing that happens when preparation meets opportunity. And to that I add that the bigger the crisis, the bigger the opportunity.
Joseph knows how to channel what could have been the greatest crisis in the history of Egypt into an unprecedented opportunity to turn Egypt into a regional power and at the same time flip his own status, making it immeasurably better.
How did it come about that a single encounter between Joseph and Pharaoh led to such a dramatically positive plot twist? The main reason is that this is a Hollywood-style story. It’s not for nothing that “Joseph and the Amazing Technicolor Dreamcoat” by Andrew Lloyd Webber is one of the most successful musicals of all time. Of course, the story would not have been so successful unless it had something to do with the lives of each and every one of us. We all have the spark of Joseph within us, the hope that luck may still shine on us. And while we cannot summon the opportunity, being prepared to grab it when it presents itself is entirely up to us. The more we do so, the more likely the opportunity will come.
Luck is an integral part of the business world. As someone who has dozens of startup investments under his belt, I can personally recount times where something like this has happened. I myself invested in quite a few startups that were on the verge of losing all hope, who had already begun shutting down and giving out notices, and then at the very last moment they were saved. On some occasions it was unexpected funds coming from an investor who was suddenly ready to accept the terms, other times it was a big client deciding to expand, an experienced senior manager coming onboard, or a rare and unusual product development that opened up new horizons.
Whether we’ve been preparing for it or not, times of crisis such as the one we’re living through now tend to breed unusual opportunities. I wish the entire entrepreneurial ecosystem and anyone who has the passion of creation within them to keep hope alive and always be prepared for the moment where opportunity gives you a chance to turn things around.