Notes from my Journal:

 “The Risk of Discovery”

Delray Beach- From Paul Graham’s blog

“Because biographies of famous scientists tend to edit out their mistakes, we underestimate the degree of risk they were willing to take. And because anything a famous scientist did that wasn’t a mistake has probably now become the conventional wisdom, those choices don’t seem risky either.

“Biographies of Newton, for example, understandably focus more on physics than alchemy or theology. The impression we get is that his unerring judgment led him straight to truths no one else had noticed. How to explain all the time he spent on alchemy and theology? Well, smart people are often kind of crazy.

“But maybe there is a simpler explanation. Maybe the smartness and the craziness were not as separate as we think. Physics seems to us a promising thing to work on, and alchemy and theology obvious wastes of time. But that’s because we know how things turned out. In Newton’s day, the three problems seemed roughly equally promising. No one knew yet what the payoff would be for inventing what we now call physics; if they had, more people would have been working on it. And alchemy and theology were still then in the category Marc Andreessen would describe as ‘huge, if true.’

“Newton made three bets. One of them worked. But they were all risky.”


Today’s Word: nascent (adjective)

Nascent (NAY-sunt or NAS-unt) refers to something just coming into existence but likely to develop quickly. Example from The God of Small Things by Arundhati Roy: “She had tweezed her once bushy eyebrows into the currently fashionable, pencil-thin arcs that gave her a slightly surprised expression even in her sleep. The rest of her expressions were growing back in a nascent stubble.”


Fun Fact

Every square inch of the human body has about 20 million skin cells.


From my work in progress basket

I Can’t Believe This Happened Again!

Three Important Lessons About Human Behavior

A long time ago, I was in a business that processed a lot of cash.

No, it wasn’t an illegal business. It was a direct-mail marketing business that sold inexpensive products, like watches and jewelry and perfume. Nothing more than 10 bucks.

Because the prices were so low, most of our orders were paid for in cash. On a typical day, tens of thousands of dollars in small bills were delivered to the office by the USPS in plastic bins.

We hired a crew of 20 or 30 people to sort through the orders and process them. At the beginning, we had no protocols in place to “safeguard” the cash – i.e., to keep our employees from stealing it.

Why? Because I was in charge of the operation and I was naïve.

I mean… I knew all of our employees, and they were all very nice people.

Anyway, a number of them, as you’ve no doubt figured out, decided to take advantage of our honor system and steal from us. And as the months passed, they became quite adept at pocketing little bundles of cash every day. By the time we found out about it, we were on track to lose six figures a month.

I’m not kidding. It was crazy.

So I had to adjust my thinking and bring in an expert to implement standard (which means very strict) procedures.

I don’t remember everything that was involved, but I do remember that the people handling the orders had to wear smocks. (Yes, I know how that sounds. Our expert insisted that it was necessary.)

This taught me an important lesson about human nature:

Nice people sometimes steal.

Allow me to fast-forward a dozen years. I was in my second retirement (and neck deep in a half-dozen hobbies and start-up business projects). I had a personal assistant who was smart and capable and terrific in almost every way.

Her job was terrific, too. She had lots of interesting things to do, and the freedom to do them pretty much as she wished. She enjoyed lots of personal perks and a six-figure salary.

And yet, one sad day, I discovered that she was stealing from me.

So I learned another important lesson:

Nice people that have great jobs and are very well paid sometimes steal.

Push the fast-forward button another 20 years, and here we are. This morning I was notified that an esteemed employee of one of the businesses I have an interest in has been stealing from us for several years. Not just hundreds or thousands, but big, big money.

How did s/he do it?

Apparently, s/he had developed a scheme of charging purchases s/he was making for one of our side businesses. S/he tested the system three or four years ago with petty cash expenses and tweaked it until it proved itself. S/he then gradually increased the amount s/he was charging.

Now here’s the thing. This is a big business with a sophisticated accounting department and all the standard protocols for reviewing and approving expenses.

But those protocols were designed to prevent mistakes – not theft. Why not theft? Again because we, the management, were naïve We couldn’t imagine that any of our nice, well paid and cared for employees would steal from us.

And this has taught me a third lesson. A lesson I should have learned 32 years ago:

The purpose of strict accounting safeguards is not to harass honest employees but to prevent the rare dishonest ones from plying their trade. And if you don’t make it difficult for your employees to steal from you by installing those safeguards, someday at least one of them will.


Check It Out…

My partner’s wife and partner, Elizabeth Bonner, and I share a passion for remodeling buildings. I like converting old warehouses into office space, art galleries, and cigar bars. She prefers restoring classic buildings. One of the buildings she’s brought back to life in recent years is Chateau de Courtomer, a building with a history that dates back to the French Revolution. I’ve stayed at Courtomer every year or two since Elizabeth and Bill bought the place, and it’s been getting better – more comfortable and more beautiful – with every visit. It used to be reserved for Agora company events, but Elizabeth is now opening it to the public. So far, it’s gotten two great reviews, one in Forbes and another in The Robb Report: