Magic, Sex, and Outer Space

Magic, Sex, and Outer Space

Goodwill is the established reputation of a business regarded as a quantifiable asset. Or of a person who’s part of that business: That’s why you often hear discussions about how to best separate personal goodwill from enterprise goodwill. But what if your personal goodwill was regarded so highly, in a contract, that you’d need to work for the new company that was buying you out for six years? And if you left, you’d have to give all the money back? James Altucher reminisces:

In 2002 I framed a $200 check from a company called thestreet.com. It was the first time I ever got paid for writing anything. When I went to get the frame, the guy said, “are you sure you don’t want to cash this?”

“No way! Someone actually paid me to write words down on a piece of paper. This is going to be worth a billion dollars some day.” Except I didn’t actually say that. It was winter and I was proud and happy and wanted to hang that up on my wall forever.

At the same time, a bank had made an offer to buy my fund for a very generous amount. My business partner, Dan, got the documents and said, “We can’t sign this.” I was standing in the lobby of the Chelsea Hotel at the time, which was like my home away from home. I kept pacing. “Why not?” I wanted the money. But my eyes gloss over whenever I read legal documents. I just assume someone is about to screw me and I tend to let it happen. But Dan read them.

Dan said, “You have to sign a six year employment agreement and at any point they can fire you and get all the money back.” So we didn’t sign it and I was very upset. It showed me that the business had no value other than the people in it (Dan, me, and we had one employee, Omid, who later did this famous video). My lawyer, Jay, even said, “slavery was outlawed in the 1800s I thought.” Maybe the one piece of advice Jay ever gave me that didn’t result in a chair being thrown at me.

Keep reading to find out about the Magic, Sex, and Outer Space bits of the equation.

(And if you’ve ever been skeptical about Quantitative Easing, be sure to check out that video by Omid!)