By Charles Moster
I was reminiscing with an old client of the Firm when suddenly he looked decidedly uncomfortable and a bit on the queasy side.  I inquired if he was suffering from food poisoning or some such malady when he confided that this year was spinning by so fast he would never achieve his financial goals for 2008.

I understand the need for planning and encourage all of my clients to think ahead, but this was different.  Ed’s family business was doing perfectly well and growing at a steady clip.  No cause for worry.  Well, not for Ed.

Mr. Ed suffers from “Growth Envy” which is equally prevalent among CEO’s of all genders.  For Ed, success is not measured by financial stability or even steady growth but the ability to exceed everyone else’s growth.   Ed covets and tries to exceed the growth trajectory of every other company in town, rather than doing what is appropriate and manageable for his business.  This can be quite daunting, particularly in Austin where technology companies grow at incredible rates, often in the high double digits.  This is even more daunting if you compare Ed’s traditional brick-and-mortar business with, say, a computer chip manufacturer or search engine purveyor.  Talk about uncontrolled business anxiety!

As an attorney and “counselor” of many years, I take my mentor role very seriously and it is important when I offer clients like Ed an antidote to their Growth compulsion.  Superficially, it is easy to point out that Ed’s fear was misdirected because comparing apples to oranges is not a great way to adjudge healthy growth.  But the question is much deeper than that.  Steady growth is obviously important, but how do you balance work and life so that you are prosperous in both?

The best way to illustrate is to recount a meeting I had with a business advisory group a few months back.  Given my firm’s interest in combining business and legal strategies to better assist clients, we volunteer our time to serve on an advisory board to emerging companies.  My colleagues on the board include a management consultant, an advertising agency, a commercial real estate development company, a financial advisory and staffing firm, and a large bank.  The discussion that afternoon centered on a new client whose business was growing at a steady 2% a year.  She was perfectly happy but wondered if she ought to be doing more because she kept reading about companies growing at breakneck speed.

The banker immediately took the lead and suggested a large line of credit to finance new inventory and sales personnel.  He was sure that with a major cash infusion the client’s growth would be a more respectable 20% or even more.  The advertising agency jumped in with a plan to tap into some of that credit line to improve branding and sales as the management consultant nodded with approval.

Not me.  I was the lone voice of dissent and conjured up on the spot a new term to better explain my discomfort, “ROL” or “Return on Life”.  In one of my more lucid and spirited moments I expounded on the need to create a new metric to measure “how we are feeling” about our business and ourselves vs. growth for growths sake.  That’s where ROL came from.  On a seeming roll, I questioned whether the client should take out a loan at all.  She was perfectly content with her business which was growing nominally.  Moreover, she enjoyed her business and her personal life, almost always managed to get home by 6:00pm or 7:00pm to spend time with her husband and favorite beagle, and was in optimum health.

And so, in the presence of Austin’s finest industrialists I posed a question which was almost heresy, particularly coming from a corporate attorney of 21 plus years.  Why change the status quo at all?  I then launched into the legal complexities that could arise from all this new debt and potential growth.  Start with a battery of new loan documents with the bank and personal guaranties.  Add to that, the need to hire new employees and staff, enter into contracts to expand inventory, develop new systems to manage that inventory, and service all the promised clients.  The new legal costs themselves would be a cause of uncontrolled anxiety!

When the smoke cleared, the members of my advisory group looked disoriented.  I remember the banker spoke first and a bit disjointed as he mumbled, “All well and good, but where’s the ROI?”  What’s that old expression, if a tree falls in the forest and no one is around to hear it, does it make a sound?  I paused then looked at the client.  She was entirely focused.  She got it.  The tree fell for her and its thud was unmistakable.

She may have considered the obvious growing pains of additional time and money, but was she ready for the costs that are harder to quantify but often more important?  What about the affects to quality of life, to corporate culture, to the quality of work delivered to clients?  Was this growth something she could manage or really even wanted?

She smiled, “Return on Life, ROL, I like that!”  This immediately broke the tension in the room as my business colleagues seemed momentarily relieved and relaxed.  But it was short lived.  Said the advertising executive, “ROL”, that’s a great hook!”  The management consultant joined in, “We can turn that into a major marketing initiative which will increase growth!”  Said the banker, “But you’ll need a loan to fund it.”

I heard myself about to say, “And you’ll need the legal advice to launch this venture”.  Fortunately, I stopped myself before the words spilled out but it was a close call!

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