I can’t remember when I heard the phrase, “It’s all about who you know” for the first time.
But I distinctly remember the time I realized it wasn’t true.
I had just left the Marines and I’d take a job on a lawn mowing crew doing basic yard maintenance for ten bucks an hour.
Not all our customers were rich but we had one guy who I thought exemplified what success should look like.
He, (let’s call him Tom) lived in a huge mansion on top of a hill that was set back off the road like something out of an Orson Welles movie.
From the street you could even see the half mile long driveway that wove it’s way through the pristinely manicured lawn up to the house.
Tom’s story was even better. At one time he’d worked for a publishing company doing music editing but when his division was shut down instead of looking for another job he bought a bunch of used editing equipment and started working for himself.
Fast forward 10 years and he owns one of the biggest studios in the Midwest and he’s living in a mansion on top of a hill.
Everybody new Tom. He was an amazing entrepreneurial success story. Or at least that’s what everyone thought.
It was around this time (2002-2003) that the publishing company that had laid him off so many years ago began looking for a new CEO. Because of his connections to the community and the publishing house specifically he was on the short list of candidates.
Tom saw an opportunity and struck. He convinced the publishing house to hire him as CEO by agreeing to merge the two companies together giving the publishing house access to a massive video production business as well as books and audio publishing.
What nobody knew at the time was the extent of Tom’s deception.
It turns out his business was nearly bankrupt. He had spent every penny he’d made (and a lot more) on first class facilities but didn’t have the customer base to support it.
He was hiding the extent of his debt and other financial problems from the publishing house and because they were so eager to get a deal done, the didn’t do the proper due diligence before agreeing to the merger.
Almost immediately after taking over as CEO the fleecing began. When the companies merged, the publishing house, (which up until then was debt free with an overfunded pension) unknowingly absorbed all the debt from Toms production company.
Before the merger Tom secretly sold the building his company owned to himself and when the publishing house began using office space in the building Tom charged them rent which he paid to himself.
He then began shorting the pension fund along with a host of other poor business decisions, driving the publishing house deep into debt.
What was the end result?
By the time the publishing house woke up to the deception they were nearly bankrupt. It took some masterfully executed business moves on the part of the vice president to save the company from ruin.
So why did I tell you this story?
Turns out it’s not who you know. It’s “Who knows you” and “What do they know?”
Tom should never have been appointed CEO. The Publishing house should have done their due diligence by vetting Toms company before agreeing to merge.
Once there Tom should never have been allowed to operate with impunity. But he was. The question is why?
Because he was well known and respected by everyone involved. Most of the publishing house board were intimidated by his perceived success and business prowess. So they didn’t question him when the warning signs appeared.
Reputation has incredible power. A carefully crafted public image can carry your farther than accomplishments ever will.
Yet most entrepreneurs spend not time or attention building a strong reputation.
One of my mentors Dan Kennedy says:
What you will be paid for…especially over time…more than your know-how, more than your service or work…is your reputation.
Do you need a great product? Yes.
Should you have a client centric company? Yes.
But if you’re not deliberately crafting and monitoring your reputation you’re hurting your business.
As todays story illustrates, reputation gives people permission to relinquish control over to you. In the hands of a good and honorable person it means good things for everyone.
But reputation, like influence or money, has no moral compass. Anyone who understands its value and learns to wield it can use it for good or evil.
I trust you’ll use yours for good.
P.S. The recording of last nights content marketing event has just been posted. At that event we talked about how to identify your ideal prospect and communicate with them in a way that builds reputation and trust.
Here’s the link: https://mediapartnersinc.clickfunnels.com/365-e1607975723298