Money often costs too much [meme]

Money often costs too much

Ralph Waldo Emerson (1803-1882) was an American essayist, philosopher, poet and lecturer. This oft-repeated quote of his is a mere snippet of a very long essay on “Wealth,” which in turn is one of nine essays in his 1860 collection entitled “The Conduct Of Life.”

Emerson is ruminating on personal wealth and its pursuit when he says that Money Often Costs Too Much. Here is a somewhat larger piece of his essay:

A youth coming into the city from his native New Hampshire farm, with its hard fare still fresh in his remembrance, boards at a first-class hotel, and believes he must somehow have outwitted Dr. Franklin and Malthus, for luxuries are cheap. But he pays for the one convenience of a better dinner, by the loss of some of the richest social and educational advantages. He has lost what guards! what incentives! He will perhaps find by and by, that he left the Muses at the door of the hotel, and found the Furies inside. Money often costs too much, and power and pleasure are not cheap. The ancient poet said, “the gods sell all things at a fair price.”

For entrepreneurs, too, it’s worth considering the price of money and that it sometimes (perhaps not “often”) costs “too much.”

  • Many businesses close their doors not out of bankruptcy, but because slim financial rewards never improve no matter how much work founders contribute. The slim returns are money that costs too much.
  • Fear of debt saddles some, especially after the mortgage crisis leading up to the Great Recession. For such entrepreneurs, any outside money costs too much.
  • Even without fear, the cost of debt can exceed its benefits. Those with poor personal credit and no business credit can be lured into online loans with daily repayments, high interest and surprising fees. That money costs too much.
  • Fear of vulture capitalists dissuades some startup founders from seeking equity investors. The potential loss of control, not to mention the loss of ownership, makes them think that money costs too much.
  • All funding takes work. The more attractive the potential funding, the more work it requires. And there’s almost always the risk that the work will only yield a “no” while the business suffers from the funding distraction. So for some entrepreneurs, any color of money costs too much time.
  • Startups and small businesses can be all-consuming. Relationships, families, friends can suffer as the business demands 120% of every waking hour. If founders aren’t careful to build meaning into their day – the pleasures of happy customers, the collegial collaboration of the team, the positive impact of business on a broader community – then even as they reap financial rewards they may find the money cost too much.

Of course this rather dark view of money is not universal. Plenty of entrepreneurs are able to figure out how to find the right balance between cost and benefit, between profit and impact, between funding and building, between fear and action, between personal and business.

And we hope we can play a role in helping you find that balance.

Don Gooding

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